Madras High Court Refuses To Quash ₹7,237-Crore Illegal Mining Cases, Says 'Unholy Nexus' Between Public Officials & Accused Delayed Trial

“Without expressing any final opinion on the merits of the recovery proceedings, this Court cannot ignore the inordinate delay in bringing the statutory proceedings to their logical conclusion. The materials placed before this Court prima facie indicate that the prolonged delay has been facilitated through an unholy nexus between certain former public officials, politicians and the accused, resulting in substantial prejudice to the interests of the State exchequer,” the court observed.

The bench of Justice Anand Venkatesh and Justice KK Ramakrishnan also took note of the new government in the State and the usual practice of appointing Special Public Prosecutors for special cases after the formation of the new government. The court thus directed the Chief Secretary to the Government to constitute a special public prosecution team to effectively conduct the prosecution and ensure that every endeavour is made to conclude the trial within 3 months.

“This Court takes the judicial notice of the fact that a new Government has assumed the office in the State of Tamil Nadu. It is well recognised administrative convention that upon the formation of the new Government, appointments of the learned Special Public Prosecutor for the special course are undertaken or reviewed in accordance with law. Accordingly, this Court deems it appropriate to direct the Chief Secretary to the Government of Tamil Nadu to constitute a Special Public Prosecution Team by appointing competent Public Prosecutors to effectively conduct the prosecution and to ensure that every endeavour is made to conclude the trial, preferably within a period of three months from the date of receipt of a copy of this order, subject to the cooperation of all stakeholders and the convenience of the trial court,” the court said.

The court was hearing a batch of cases filed by granite quarry operators seeking to quash/discharge them from cases initiated against them in connection with illegal mining. The case against the petitioners was that they had conspired with government officials and engaged in illegal quarry operations in non-lease areas in Government Poramboke land, and illegally gained Rs 7237 crores.

Cases were registered against the operator for offences under Sections 447, 434, 379, 420, 430, 465, 467, 468, 471, 304(ii) read with Section 109, 114, and 511 of the IPC and Section 3(i) (ii) and 4 of the Tamil Nadu Property (Prevention of Damage and Loss) Act, 1992 and Section 3(a) & 4(a) & 6 of Explosive Substance Act, 1908 r/w.120(b) of IPC. Since the petitioners had laundered proceeds of crime by acquiring a large number of immovable properties, cases were also registered under the Prevention of Money Laundering Act. Seeking discharge/quashing of the cases, the present petitions were filed.

The petitioners relied on a report of the High-Level Committee and argued that the report discloses that no offence was made out against the accused. He argued that when the final report was filed based on a valuation report for assessing the quantity of illegally quarried minerals. It was argued that the High-Level committee's report, subsequent to the valuation report based on a direction of the Supreme Court, had a binding force.

The state, on the other hand, argued that the reliance on the High-Level committee's report was fundamentally misconceived as the Supreme Court had never directed the constitution of the committee. The state informed that the assessment and recovery proceedings were entirely independent of the criminal prosecution and the subsequent committee report, even if available, could not have any bearing on the continuation of the criminal proceedings.

The state informed that the investigation has revealed large-scale illegal mining, extensive damage to government property, excavation of massive pits, destruction of water bodies, fabrication of documents, forgery of official records and systematic usurpation of government property. It was argued that there was sufficient oral and documentary evidence and a prima facie case was disclosed.

The court noted that while exercising jurisdiction under Section 482 of CrPC, it was not expected to appreciate the evidence or conduct a mini trial to determine the correctness of the prosecution case. The court noted that for deciding the quashing plea, the court was only expected to see if there was a prima facie case.

The court noted that there were prima facie materials against the petitioners in the present case. With respect to the High-Level committee report relied upon by the petitioners, the court agreed with the prosecution that the committee was constituted solely for the limited purpose of determining the quantum of damages. The court added that the evidential scrutiny of the report could be tested only during the trial and the court could not examine its correctness in a quash plea.

The court also noted that there were prima facie ingredients for constituting the offence of money laundering, justifying the framing of charges and continuation of proceedings. Thus, the court found no merit in the contentions raised by the petitioners and was not inclined to quash the criminal proceedings.

Counsel for Petitioner: Mr. R. John Sathyan Senior Advocate Mr. R. Tamilvanan, Mr. N. Anandapadmanaban Senior Advocate Mr. S. Agilesh Kumar, Mr. V. Malaiyendran

Counsel for Respondents: Mr. K. R. Laxman Standing Counsel for ED, Mr. A. Thiruvadikumar Additional Public Prosecutor

Case Title: PRP Exports and Others v Directorate of Enforcement

Citation: 2026 LiveLaw (Mad) 335

Case No: CRL OP(MD) No.174 of 2026 batch cases