Lagatar24 Desk
Chennai: The Madras High Court has delivered a sharp rebuke to the Enforcement Directorate (ED) over its handling of the illegal sand mining investigation in Tamil Nadu and neighbouring Andhra Pradesh. A bench comprising Justice MS Ramesh and Justice Sunder Mohan ruled that the federal agency had overstepped its jurisdiction, as mining activities, legal or illegal, are not classified as scheduled offences under the Prevention of Money Laundering Act. Consequently, the High Court has halted proceedings against the accused sand mining contractors and instructed the ED to release seized properties.
The court’s order, issued on Tuesday, highlighted that without the registration of a scheduled offence generating proceeds of crime falling under the ED’s purview, no action could be initiated by the agency.
This isn’t the first instance where the ED’s actions in this case have faced judicial scrutiny. Last November, the High Court had temporarily stayed the ED’s summons to five District Collectors, questioning the agency’s powers and its adherence to federal principles.
The ED had summoned District Collectors from Ariyalur, Vellore, Thanjavur, Karur, and Tiruchirapalli as part of its investigation.
The ruling Dravida Munnetra Kazhagam (DMK) in Tamil Nadu had opposed these summonses, arguing that the ED’s actions were beyond its statutory powers and undermined federalism. The state government contended that it had already initiated police cases and was willing to cooperate by providing necessary details, insisting that any investigation should proceed with its consent.
In February, the ED had approached the Supreme Court challenging the High Court’s stay on the summonses to the District Collectors. During the hearing, Justice Bela M Trivedi had questioned the state’s objections, asking about its stake in the matter. The Supreme Court subsequently directed the five officials to appear before the ED.
The alleged illegal sand mining racket, estimated by the ED to be worth over Rs 4,000 crore, has been a contentious issue in Tamil Nadu for several years, particularly during the previous administration led by the All India Anna Dravida Munnetra Kazhagam (AIADMK). The BJP had also raised this issue during the Lok Sabha elections in February, leveraging it as a political point of contention.
Tax authorities have alleged that profits from illegal mining activities were laundered into investments in various sectors, including spinning mills, sugar mills, hotels, and even overseas transactions.
The Madras High Court’s latest directive underscores the complexity and sensitivity surrounding the enforcement of laws related to natural resource exploitation and financial crimes, particularly in a politically charged environment like Tamil Nadu.
