New Delhi– In a powerful rebuke to the Enforcement Directorate (ED), the Supreme Court of India has stayed the central agency’s money laundering probe into Tamil Nadu’s state-run liquor distributor, TASMAC, calling the ED’s actions a breach of constitutional limits and the federal structure.
A bench comprising Chief Justice B.R. Gavai and Justice Augustine George Masih issued notices to the ED after the Tamil Nadu government and TASMAC challenged recent raids conducted by the agency. The court questioned the ED’s jurisdiction over a state-controlled entity, emphasizing that law and order remains a state subject under the Constitution.
Representing Tamil Nadu, Senior Advocate Kapil Sibal argued that the state had already acted on the matter, filing 41 FIRs between 2014 and 2021 concerning alleged corruption in liquor licensing. He asserted that the ED’s involvement was both excessive and unconstitutional.
The ED had claimed a ₹1,000 crore liquor scam involving unaccounted funds and alleged that distilleries paid bribes for favorable supply contracts. Raids were conducted in March and earlier this month across Tamil Nadu.
The Supreme Court’s order halting the investigation highlights growing friction between the Centre and states over the reach of federal agencies. The matter will be taken up again after the court’s summer vacation, with the ED asked to respond to the notices.
