New Delhi – The Supreme Court on Thursday sharply criticized the Enforcement Directorate (ED) for overstepping its jurisdiction in connection with raids on Tamil Nadu’s state-run liquor outlets. Referring to recent raids on TASMAC (Tamil Nadu State Marketing Corporation Limited), the court accused the federal agency of violating principles of federalism and ordered a halt to further proceedings for now.
A bench led by Chief Justice DY Chandrachud observed, “You may register cases against individuals… but corporations? Your ED is crossing all limits!” The court issued a notice to the ED, returnable after the summer vacation, and granted an interim stay on ongoing proceedings.
The ruling comes after the DMK-led Tamil Nadu government challenged a Madras High Court order from April 23 that had permitted the ED to proceed with its investigation into alleged corruption in liquor license grants. The Supreme Court’s strong remarks have been welcomed by the DMK, with senior leader RS Bharathi calling it a setback to what he described as the BJP’s attempt to “malign the state government.”
The controversy revolves around the ED’s raids in March and again in May on TASMAC offices across Tamil Nadu. The agency claimed to have uncovered “multiple irregularities,” including alleged fraudulent pricing practices and unaccounted cash worth ₹1,000 crore. It also said it had seized incriminating documents and cloned mobile phones, raising concerns about data privacy and procedural overreach.
Among the alleged irregularities were inflated surcharges of ₹10–₹30 per liquor bottle and biased allocation of bar and transport licenses that reportedly favored specific distilleries. However, Tamil Nadu Excise Minister S. Muthusamy hit back, accusing the ED of harassment and political vendetta, asserting that no substantial proof had been found.
The raids and allegations have heightened political tensions ahead of next year’s Assembly elections, with the BJP’s former state unit chief K. Annamalai launching a scathing attack on DMK minister V. Senthil Balaji. He labeled Balaji the “kingpin” of what he claimed was a ₹1,000 crore scam, though the minister has strongly denied all accusations.
“Everything in TASMAC is transparent,” Balaji responded. “Procurements are done based on a calculated average of past purchases. There’s no preferential treatment.”
The case has brought renewed scrutiny over the use of federal investigative agencies and their role in politically sensitive matters, particularly in opposition-ruled states. With the Supreme Court’s interim relief, the battle over TASMAC’s operations and the ED’s involvement is now set to continue after the court’s vacation.
