“Violating Federal Structure, Crossing All Limits”- Supreme Court Slams ED

A bench of the Supreme Court, including CJI (Chief Justice of India) BR Gavai, said today that the Enforcement Directorate (ED) is crossing all limits. CJI Gavai was reported in the media to have said, “You are totally violating the federal structure of the country”. 

The hard words from the SC came in the hearing where the top court stayed the investigation and raid of the Enforcement Directorate against the Tamil Nadu State Marketing Corporation (TASMAC). 

A bench consisting of CJI BR Gavai and Justice AG Masih was hearing the petitions filed by the State of Tamil Nadu and TASMAC, where they challenged the rejection of their plea against searches conducted by the ED on the TASMAC headquarters by the Madras High Court.

Senior Advocate Kapil Sibal appeared for the State. In his submission, Sibal said that the State itself has filed 41 FIRs against liquor outlet operators over allegations of corruption during 2014-21. Despite this, the ED entered the scene in 2025, raided the Headquarters and took the phones and devices of the officers, Sibal argued in his submission.

The government counsel argued that the case involves corruption amounting to over Rs 1,000 crore. He asserted that the ED is "not overstepping its bounds, at least in this case."

The Case

The Tamil Nadu government and TASMAC moved the Supreme Court against the ED raids at the premises of TASMAC. The TASMAC is the state-run liquor retailer. 

After the Madras High Court rejected the pleas by the Tamil Nadu government and TASMAC, ED was allowed to proceed with its action under the Prevention of Money Laundering Act (PMLA).

The Madras High Court observed that the offence of money laundering was a crime against the people of the nation. 

Senior Advocate Mukul Rohatgi appeared for the TASMAC. In his argument, he said that the ED has taken the cloned copies of the phones of the TASMAC officials, violating their privacy. 

Kapil Sibal at this point said that the Court should restrict the ED from using the data they have taken from phones and devices, arguing that this is an issue of privacy. CJI Gavai reiterated the interim relief provided by the court and said that it can't pass further directions.

On  ASG Raju’s argument that it was a case of Rs 1000 crore fraud to justify ED’s actions, CJI BR Gavai pointed out that the State has already registered FIRs and was taking action.

 "Why should ED unnecessarily...where is the predicate offence?" CJI Gavai was reported to have said. ASG said that there was a major fraud that the ED was investigating and politicians were being protected. 

At this point, CJI Gavai commented that “ED was crossing all limits and violating the federal structure of the country.”

The  ASG denying it said that a detailed reply will be filed soon.

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