The Supreme Court questioned the Tamil Nadu government’s successful intervention in the Madras High Court to get a stay of summons issued by the Directorate of Enforcement (ED) to five District Collectors in connection with a money laundering case linked to “illegal” sand mining.
“How can the State file a writ petition against the Enforcement Directorate? How is the State aggrieved? How is the State interested? Let the Collectors respond to the summons… Are they not supposed to cooperate with the investigative agency?” Justice Bela M. Trivedi quizzed the Tamil Nadu government, represented by senior advocate Mukul Rohatgi.
Mr. Rohatgi countered that the actions of the Central agency infringed on federalism and separation of powers. Tamil Nadu argued that any investigation related to money laundering in relation to a predicate offence arising out of and within the territorial limits of a State could be done only at the request of the State or by the directions of the constitutional courts.
“They [District Collectors] are not supposed to cooperate if the agency is acting without jurisdiction,” he countered.
Tamil Nadu Additional Advocate General, senior advocate Amit Anand Tiwari, appearing for the District Collectors, argued that the stay order of the High Court in November 2023 was also based on separate petitions filed by his clients.
Additional Solicitor General S.V. Raju, for the ED, said the State was now “interfering even in the operation of simple, innocuous summons”. He said the five District Collectors of Vellore, Tiruchi, Karur, Thanjavur and Ariyalur were not being called as accused, but only witnesses.
At one point, Justice Trivedi remarked she would stay the High Court order, but Mr. Rohatgi convinced the Bench to list the case again on February 26.
Multiple raids
This is the second time the ED and the Tamil Nadu government are engaged in a tug-of-war in the Supreme Court. They had clashed recently in the top court over criminal proceedings initiated by the Tamil Nadu Directorate of Vigilance and Anti-Corruption (DVAC) against ED officer Ankit Tiwari. The State had seen multiple raids and searches conducted by the ED in the past months. In January, the apex court had proposed a transparent mechanism to prevent vindictive arrests and one-upmanship between the ED and States.
In its appeal against the November 2023 stay order, the ED said efforts were underway to “unearth the nexus between the illegal miners, officials and local mafia in the State”. It said searches were conducted in 34 places across Tamil Nadu in September last year, leading to seizure of currency, incriminating documents and digital devices.
The appeal said an expert study revealed that the value of excess sand mining in Tamil Nadu came to ₹4,730 crore against the recorded revenue of ₹36.45 crore earned by the State government.
