The Tamil Nadu State Marketing Corporation (TASMAC) informed the Madras High Court that the recent searches conducted by the Enforcement Directorate (ED) appear to be politically motivated, especially with the upcoming Tamil Nadu Assembly elections approaching. TASMAC argued that the ED was attempting to damage the reputation of individuals associated with the election process by initiating these inquiries.
Senior Advocate Vikas Singh, representing TASMAC, presented these arguments before a division bench comprising Justice SM Subramaniam and Justice K Rajasekaran.
"I'll tell you how the ED works. The Tamil Nadu election is next year. So they'll start this year. Look up old FIRs and start roving and fishing inquiry. They are taking up matters to some kind of result to tarnish the image of people involved in the Election. Why are they suddenly dreaming that the Tamil Nadu excise department is corrupt?"
Singh stressed that the ED's actions must stay within the boundaries set by law. According to him, the ED can only conduct searches and seizures when a scheduled offence exists — a key requirement under the Prevention of Money Laundering Act (PMLA). He explained that the ED’s jurisdiction to investigate only begins once such an offence is clearly established. Singh pointed out that the ED cannot begin an investigation on the assumption or "hope" that an FIR might exist later.
Please see the danger. There are 29 states in the country. In every state, wherever there is an opposition party in governance, ED will pick up any ministry and start a roving enquiry? If they don't have the jurisdiction to do it in an opposition state, they don't have a jurisdiction to do it in the BJP ruled state also. It's a different matter that they don't do it in BJP ruled state and only in select states.
Singh also highlighted the difficulty faced by TASMAC in defending itself. He informed the court that neither the State nor TASMAC had been provided access to the FIR or the Enforcement Case Information Report (ECIR).
"We're making submissions blindfolded because we don't know what are the offences against me, what are the facts against me. It is not possible for us to argue in this matter without them producing the FIR. It should be allowed on that ground itself that there's no FIR in the eyes of law. The court had asked them to produce FIRs but they haven't."
The senior advocate went on to say that this case was particularly unusual. Unlike other cases, where there is at least a clear FIR that meets the PMLA threshold, the ED in this instance had neither disclosed any FIR nor shown willingness to do so.
He also clarified that, while the ED is allowed to attach properties under certain conditions without an FIR, the same does not apply to search and seizure operations, which require the presence of a valid FIR.
When the State made its submissions, Advocate General PS Raman argued that TASMAC had not been named in any of the FIRs. Raman stated that while TASMAC never refused to cooperate, the ED still went ahead and conducted searches without producing any concrete material.
Further, Raman pointed out that the ED had failed to inform any senior State official about its actions, which raised serious questions about the procedural fairness of the probe.
"It is very much an ego point. The Home Secretary, DGP, not even the provisional excise commissioner has been given any letter by the ED on what happened. Let them produce one communication to the government or to the TASMAC."
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After hearing both sides, the Madras High Court directed the ED to submit the details of any FIRs registered against TASMAC or its officials that formed the basis of the ongoing investigation.
Case Title: Tamil Nadu State Marketing Corporation Ltd TASMAC v. Directorate of Enforcement
Case Number: WP 10348 / 2025
