The Supreme Court has delivered a sharp rebuke to the Enforcement Directorate (ED) over its controversial raids on TASMAC, the Tamil Nadu State Marketing Corporation Limited, calling out the agency for “crossing all limits” and violating principles of federal governance.
The apex court’s comments came in response to ED’s raids in March and last week on TASMAC outlets and state-run liquor establishments. The ED is investigating alleged corruption related to liquor transportation, bar licensing, and the siphoning of unaccounted funds in collusion with distilleries and bottle manufacturers. The court has now directed the federal agency to halt all further proceedings.
A bench headed by Chief Justice BR Gavai stated,
“You may register cases against individuals… but corporations? Your ED is passing all limits! Issue notice, returnable after vacation.”
He further added, “Meanwhile, stay granted of further proceedings…”
The ruling has been welcomed by the ruling DMK, with senior leader and former Rajya Sabha MP RS Bharathi calling it a “blow to the BJP’s efforts to malign the state government.”
ALSO READ: India sees mild rise in COVID-19 cases amid global JN.1 variant surge
The case reached the top court after the DMK-led Tamil Nadu government challenged a Madras High Court order dated April 23, which had allowed the ED to proceed with its investigations. Senior advocate Kapil Sibal argued that the ED not only raided TASMAC offices but also seized and cloned multiple mobile phones during raids conducted on March 14 and May 16.
In its defense, the ED claims it found “multiple irregularities” in TASMAC’s operations, including unaccounted cash worth ₹1,000 crore, and “incriminating” data on corporate postings, transport and bar licence tenders, and alleged favoritism toward specific distilleries. The agency also accused TASMAC officials of enabling fraudulent pricing schemes, including illegal surcharges of ₹10 to ₹30 per bottle.
Responding to the allegations, a TASMAC official stated,
“Everything is transparent as far as TASMAC is concerned. As far as purchase is concerned… it would be done by calculating the average of the last three months of purchase brand. By taking the average of the last three years and the last month’s purchase, TASMAC will give a purchase order. So, we have not shown any discount to anyone on giving purchase orders.”
Tamil Nadu Excise Minister S. Muthusamy slammed the raids, calling them politically motivated:
“The ED is harassing state government officials. There are ulterior political motives behind the raids. The Chief Minister’s government stands firmly behind its officers.”
The controversy has ignited a political firestorm ahead of the 2026 Tamil Nadu Assembly elections, with the BJP’s former state chief K. Annamalai launching an attack on state minister V. Senthil Balaji.
“I have my sources. I believe (the corruption) is over ₹1,000 crore. Senthil Balaji is involved in every single scam. He is the kingpin. Supreme Court has questioned (him)…”
Balaji, however, has denied all allegations and criticized the ED for making baseless claims.
With the Supreme Court now intervening, the future of the ED’s investigation hangs in the balance, placing further scrutiny on federal agency overreach and state rights in India’s democratic framework.
