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The Supreme Court on Monday dismissed a plea filed by former Tamil Nadu Minister KN Nehru challenging a Madras High Court direction to register an FIR against him on corruption allegations based on materials shared by the Enforcement Directorate (ED).

A bench comprising Justice Dipankar Datta and Justice Sheel Nagu observed that there was no ground made out to interfere with the High Court's February 20 judgment and its October 26 order dismissing Nehru's review petition. The bench clarified that the High Court's observations will be considered as necessary only for the purpose of the disposal of the matters, and will not preclude the petitioner from raising his defence at the appropriate stage.

The matter pertains to alleged irregularities in recruitment to 2,538 posts in the Tamil Nadu Municipal Administration and Water Supply Department, involving alleged illegal gratification of approximately ₹634 crore.

The ED had forwarded materials to the Tamil Nadu Director General of Police in October 2025, alleging corruption in the recruitment process.

Senior Advocate Shyam Divan, for Nehru, submitted that the High Court's order was fundamentally erroneous as it was passed without giving him an opportunity of hearing. Divan said that had the High Court merely ordered an investigation, it would still have been acceptable; however, the High Court passed adverse findings against him without hearing him.

The bench however pointed out that he was served notice but did not join the proceedings. Divan said that notice was received on the day when the matter was reserved for hearing, and there was no effective opportunity to file a response.  Justice Datta also disagreed that there was any finding by the High Court, and that they were merely recording the observations in the record.

On merits, Divan argued that the ECIR was quashed by the Madras High Court in July 2025 as the predicate offence was earlier quashed, and once the ECIR has gone, the ED cannot invoke Section 66(2) of the Prevention of Money Laundering Act to share the information with the State police. "The moment the predicate offence is quashed, and ECIR is set aside, this expression 'material in his possession' doesn't apply because they don't have anything in their possession. You can't act or proceed-HC looked at what was in the sealed envelope because the ED proceeding had ended. They can't retain documents," Divan submitted.

"You don't issue notice to me, the notice is ineffective. When a political rival has approached the Court, the Court ought to be more circumspect. The greater the potential prejudice, greater the obligation on the Court to be fair and just, and to appear just and fair," Divan urged.

The bench however was not persuaded by these arguments.

In October 2025, the ED had written to the Tamil Nadu police chief alleging that the Minister and his associates were involved in a cash-for-job scam in the MAWS department. The ED had asked the police to take action against the Minister and his associates under the Prevention of Corruption Act.

Since there was no action based on these materials, writ petitions were filed by Athinarayanan and by AIADMK Rajya Sabha member IS Inbadurai seeking directions to the Directorate of Vigilance and Anti-Corruption(DVAC) to register a complaint based on information received from the ED.

In February this year, the High Court allowed the writ petitions, directing the FIR registration. Though the State filed a review, after the change of government, it was withdrawn. However, Nehru filed an independent review petition contending that the order was passed without hearing him. On October 26, the High Court dismissed his review petition.

Challenging the High Court's order, Nehru filed Special Leave Petition in the Supreme Court on October 26.

The State had filed a caveat as well.

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