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Supreme Court Questions DMK Govt Over Filing Writ Petition Challenging ED Summonses To District Collectors In Alleged Sand Mining Case

The Commune

The Supreme Court raised questions regarding the state government’s decision to seek a stay on summons from the Enforcement Directorate (ED) from the Madras High Court on 23 February 2024. The court noted that the ED was justified in issuing summons to five district collectors of Tamil Nadu in relation to a money laundering case associated with an alleged illegal sand mining case. The court has set a date for further consideration of the matter on 26 February 2024.

The Supreme Court reviewed the ED’s plea challenging a high court order on 28 November 2023, that had temporarily halted the enforcement of summons issued to five district collectors. Justices Bela M Trivedi and Pankaj Mithal presided over the hearing of a special leave petition filed by the ED questioned, “How can the state file this writ petition? Under which law…You satisfy us on how state is interested and how it can file this writ petition against the Enforcement Directorate. How is the state aggrieved? We’ll stay this order.”

Senior advocate Mukul Rohtagi, representing the state government, informed the court that there is no legal prohibition preventing the state from approaching the high court. Assisting him, TN additional advocate general Amit Anand Tiwari highlighted that in the five petitions where the high court issued a common interim order, the collectors of Vellore, Trichy, Karur, Thanjavur, and Ariyalur districts were co-petitioners.

The presiding judges stated, “These offenses fall under the category of scheduled offenses as per the Prevention of Money Laundering Act (PMLA). The Enforcement Directorate (ED) has the authority to conduct investigations, given that Section 50 of PMLA allows for a preliminary inquiry. Are the district collectors not obligated to collaborate with the investigative agency?”

Additional Solicitor General SV Raju, representing the Enforcement Directorate (ED), informed the court that the recent decision is impeding the ongoing investigation and requested a stay on the High Court order. As Rohatgi sought an extension to submit a response, the court scheduled the matter for Monday. Rohatgi asked for time to provide a reply, stating, “The ED lacks jurisdiction in this case. These issues pertain to federalism, and the state has the right to raise objections.” The Court, without issuing notice on the ED plea, set the matter for Monday to allow an initial response from the state.

Context

The Enforcement Directorate initiated proceedings based on four FIRs in Tamil Nadu related to violations under the Prevention of Corruption Act and other sections of the Indian Penal Code. Following a scientific study conducted by ED using an expert team, it was asserted that the value of sand mining in Tamil Nadu amounted to ₹4,730 crores, significantly higher than the recorded revenue of ₹36.45 crores according to state records.

In a bid to expose the alleged collaboration between state officials and local entities, the Enforcement Directorate  carried out raids at 34 locations across diverse districts. These operations led to the confiscation of cash, incriminating documents, and digital devices. Unaccounted property documents worth crores of rupees were discovered in the residences of individuals such as businessman Pudukottai Ramachandran, Dindigul Ratnam, Karikalan, and Water Resources officials, acting as wholesale agents for sand quarries. Seizures reportedly included ₹12.82 crore in cash and gold jewelry weighing 1,24 grams valued at ₹56.86 lakh.

In response to these events, the Chief Engineer of the Tamil Nadu Government’s Water Resources Department, Muthiah, personally presented documents and provided an explanation at the Enforcement Department office in Nungambakkam.

Following the raids, district collectors were summoned on November 17 under section 50 of the Prevention of Money Laundering Act (PMLA). A legal challenge against these summons was filed in the Madras High Court by the Public Works department Secretary, the Additional Chief Secretary of the Water Resources Department, and the respective District Collectors. The High Court, granting an interim stay on the Enforcement Department’s summons, expressed the opinion that the inquiry seemed to exceed the ED’s jurisdiction. It suggested that the summons might be an attempt to investigate potential proceeds of crime related to activities not yet registered by state agencies.

In reaction to the High Court’s decision, an appeal was filed in the Supreme Court on behalf of the Enforcement Directorate challenging the High Court’s order. The state government contended in its petitions that the ED lacked jurisdiction to investigate without state consent, asserting the action as unlawful due to violations of constitutional principles of federalism and the separation of powers. The state maintained that any ED investigation without state consent or constitutional court direction was impermissible.

Allegations of Illegal Sand Mining in Tamil Nadu

Arappor Iyakkam, an anti-corruption NGO, has recently raised serious allegations concerning a significant scandal in Tirunelveli on 22 February 2024. The accusations specifically target DMK MP S Gnanathiraviyam, implicating him in corruption charges related to the illicit mining of rough stone and gravel. The NGO asserts that the corruption scandal has resulted in an estimated government loss exceeding ₹700 Crores, primarily concentrated in the districts of Tirunelveli, Tamil Nadu, and Tirupur. Arappor Iyakkam has taken formal action by filing a complaint with the Director of Vigilance and Anti-Corruption (DVAC) in Chennai.

On 25  April 2023, Lourth Francis, a 55-year-old Village Administrative Officer (VAO), met a tragic end when he was ruthlessly attacked and killed within the premises of his office in Murapanadu, Thoothukudi. The assailants, believed to be linked to the sand mafia, targeted Francis, ostensibly due to his efforts in bringing attention to illicit sand mining activities by raising concerns with the district administration and the police in the region.

(with in[its from Hindustan Times)

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