Supreme Court stops ED raids on TASMAC, slams overreach

The Supreme Court has temporarily paused the Enforcement Directorate’s (ED) money laundering investigation and raids targeting the Tamil Nadu State Marketing Corporation (TASMAC), the state-run liquor retail chain. A bench led by Chief Justice BR Gavai and Justice Augustine George Masih strongly criticized the ED's actions, stating that the agency was overstepping its authority and violating the principle of federal governance as outlined in the Constitution.

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The top court issued a notice to the ED in response to a petition by the Tamil Nadu government, which opposed a previous Madras High Court order that had allowed the central agency to continue its investigation into a reported Rs 1,000 crore scam involving TASMAC. The bench also questioned the basis of the ED's involvement, asking for clarity on the initial criminal offence that justified its entry into the case.

Senior advocate Kapil Sibal, representing the state, argued that Tamil Nadu had already initiated 41 FIRs against various individuals in relation to irregularities between 2014 and 2021, but the ED only stepped in during 2025. He accused the ED of overreach, stating that the agency had confiscated and cloned digital devices during its raids on TASMAC offices.

The ED claims its investigation is linked to allegations that certain distilleries used illicit funds to secure preferential supply deals from TASMAC. The DMK-led government and TASMAC challenged the legality of the ED’s actions, particularly the April 23 Madras High Court decision that had allowed the probe under the Prevention of Money Laundering Act (PMLA) to go forward.