Madras High Court Orders CBI Probe Into Rs.5800 Crore Illegal Sand Mining In Tamil Nadu

The Madras High Court, in a significant judicial directive on Monday, ordered the Central Bureau of Investigation to undertake a comprehensive probe into the alleged illegal extraction of beach sand minerals valued at Rs.5,832 crore by private mining corporations operating in Tamil Nadu’s coastal districts of Tirunelveli, Tuticorin, and Kanyakumari.

Recognizing the extensive economic ramifications and possible administrative collusion, the court underscored the necessity of examining the complicity of governmental officials and the potential existence of political entanglements.

A division bench comprising Justices S. M. Subramaniam and M. Jothiraman instructed the CBI to initiate criminal proceedings and commence a thorough investigation.

The order was issued in response to a series of petitions, including a suo motu Public Interest Litigation (PIL), as well as pleas submitted by V. V. Minerals and 29 other entities.

The bench explicitly stated, “In light of the above discussions, this Court finds it a fit case to refer the matter to the CBI. Hence, based on the findings in the Committee reports discussed above and all other materials available on record, the CBI is directed to register criminal cases and launch investigations.

Additionally, any pending cases currently under the jurisdiction of the Tamil Nadu Police shall be transferred to the CBI to facilitate a more efficacious investigative process. All pertinent case files must be handed over to the CBI within four weeks.”

The court mandated that the CBI Director establish multiple Special Investigation Teams (SITs) staffed by highly competent and ethically sound officers to ensure the integrity and efficacy of the inquiry. The scope of the investigation must encompass the structural framework of the illegal beach sand mining syndicate, the administrative failures and possible dereliction of duty by officials across hierarchical levels, and the consequential fiscal detriment inflicted upon the state exchequer.

Additionally, the court called for an in-depth examination into allegations of corruption, including suspected collusion between state officials and private mining entities engaged in unlawful mineral extraction, transportation, storage, and export.

The scrutiny must extend across all governmental departments with regulatory oversight of the sector. Moreover, the inquiry should assess the role of officials involved in royalty assessments, wherein seemingly arbitrary determinations allegedly conferred undue financial advantages upon respondent corporations.

The court further directed that any potential political complicity be rigorously investigated. “Hence, the CBI is directed to investigate the alleged political nexus and examine the role of policymakers in conspiring with private mining entities,” the bench stated unequivocally.

Emphasizing the broader national security implications, the bench highlighted the necessity of a multidisciplinary investigative approach to assess the presence of elevated monazite concentrations in processed stocks and to determine whether this regulated substance had been illicitly exported.

The court insisted on scrutinizing the unauthorized inclusion of monazite by the state government in contravention of statutory mandates requiring prior central government approval. The inquiry must ascertain whether such actions were indicative of systemic collusion between political, bureaucratic, and corporate actors.

Beyond these primary concerns, the court granted the CBI discretionary authority to expand its inquiry as required and mandated the submission of a conclusive report before the Jurisdictional Court. Recognizing the immense financial scope of the alleged misconduct—with fiscal losses amounting to thousands of crores—the court instructed the Government of India to conduct a meticulous review of all financial and commercial transactions involving the respondent mining firms dealing in beach sand minerals (BSMs).

The matter was further referred for investigation by specialized agencies, including the Enforcement Directorate, the Income Tax Department, the Customs and Excise Department, and the Commercial Taxes Department.

The Governments of Tamil Nadu and India were also directed to initiate simultaneous departmental disciplinary proceedings against officials implicated in the unlawful activities. Additionally, the court authorized any concerned party to initiate contempt proceedings in the event of non-compliance with its judicial directives.

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