‘ED crossing all limits’: SC stays Tasmac probe, says agency ‘violating federal structure’

In a big relief to the DMK government in Tamil Nadu, the Supreme Court has stayed the Enforcement Directorate’s (ED) investigation and searches into the Tamil Nadu State Marketing Corporation (Tasmac), saying that the central agency was “crossing all limits”.

“Your ED is crossing all limits,” Chief Justice of India BR Gavai reportedly told Additional Solicitor General SV Raju during the hearing on Thursday (May 22). “You are totally violating the federal structure of the country,” CJI Gavai said.

Also read: Tasmac probe: ED slams TN govt for not appointing nodal officer

State has filed 41 FIRs: TN

The bench of CJI Gavai and Justice AG Masih was hearing a petition filed by Tamil Nadu challenging Madras High Court’s rejection of its plea against searches conducted by the ED on the Tasmac headquarters.

Senior Advocate Kapil Sibal, appearing for Tamil Nadu, said the state itself has filed 41 FIRs against liquor outlet operators from 2014 to 2021 over allegations of corruption. However, the ED started raiding the headquarters in 2025 and seized phones and other electronic devices of the officers, Sibal said.

“This is a corporation giving liquor outlets. And we found some of the people to whom outlets have been given are actually taking cash. So, the State itself filed 41 FIRs from 2014-21 against individuals, not against the corporation,” Sibal said, according to Live Law.

Also read: ED probes secret ‘party fund’, who handled it in TN Tasmac ‘scam’

Court orders notice to ED

CJI Gavai then asked ASG Raju how the offence was made out against the corporation. “Your ED is crossing all limits, Mr Raju,” the CJI said.

The Bench then ordered a notice on the petition to the ED. “In the meantime, there shall be stay of further proceedings [against] the petitioners,” the Bench said.

When ASG Raju claimed that it was a case of Rs 1000-crore fraud, CJI Gavai pointed out that the state has already registered FIRs and was taking action.

Also read: TN minister Muthusamy terms ED raids on Tasmac ‘political vendetta’

Violating federal structure: CJI

The ASG again argued that the ED was investigating a major fraud in which politicians were being protected. To this, CJI Gavai repeated that the ED was "crossing all limits" and "violating the federal structure of the country".

ASG Raju, denying this, said he would file a detailed reply.

Senior Advocate Mukul Rohatgi, representing Tasmac, argued that the ED has violated the privacy of its officials by taking the cloned copies of their phones. Sibal further urged the court to restrict the ED from using the data they have gathered from these devices.

CJI Gavai then said the court had already granted interim relief and could not pass any further directions.