Suspicion Over TASMAC Employees Taking Bribe Enough To Search Head Office, Court Cannot Scrutinise Place Of Search: ED Tells Madras High Court

On Wednesday, Additional Solicitor General SV Raju, appearing for the Enforcement Directorate (ED), informed the Madras High Court that the agency had raided the headquarters of the TASMAC because it had "grounds to believe" that proceeds of crime or evidence connected to proceeds of crime were present at the premises.

Yesterday, a division bench of Justices SM Subramaniam and K Rajasekaran were told by the petitioners, that the ED was conducting a "roving inquiry" only because the agency wanted to tarnish the reputation of high-profile individuals involved in the case, months before the Tamil Nadu elections.

In today's hearing, the ASG pointed out that the search at the TASMAC head office had only taken place due to various FIRs regarding involvement of TASMAC officials in taking bribes, inflating marked prices on liqour bottles and manipulating postings and transfers of employees had surfaced. It was pointed out that these complaints had been registered by the state police itself.

Court questioned the ASG as to why the headquarters were searched, when there were a number of complaints spread over different areas. 

It was stated by the ASG that the nature of complaints, as pointedout  earlier, had a direct nexus with material which may be available in the head offices. It was submitted that under Section 17 of the PMLA, the ED was given the power to conduct searches at premises if it had reason to believe that there were proceeds of crime or even material connected to the proceeds of crime present there.

It was further added that merely because a search did not return any material, the need for the search could not be called into question.

ASG argued that in this case, searching the headquarters of the TASMAC allowed the agency to unearth various irregularities to the tune of Rs 1000 crores.

Thus, it was stated that suspicion alone can be used as a ground for search and that the court did not have the authority to intervene at this stage or to question the location for search chosen by the agency.

Advocate General PS Raman, appearing for the stat,e submitted that while the cooperation of the state in the matter had been questioned, the ED had not informed the state of its intention to search the TASMAC offices. It was submitted that even the FIRs which were relied on by the ED to justify their search had not been handed over to the state, even in a redacted form.

It was further submitted that employees were kept waiting in the office for hours on end, without any justifiable cause and that women employees were being questioned in the absence of any female officers from the ED.

Upon hearing the arguments, the court adjourned the matter and kept it for further hearing tomorrow. (April 17)