TN govt moves Madras HC questioning ED summons in sand mining cases

The Tamil Nadu government moved the Madras High Court on Monday, 27 November, challenging the summons issued by the Enforcement Directorate (ED) to district collectors in the state in a money laundering case that is allegedly linked to illegal sand mining. Interim orders are likely to be passed on Tuesday, 28 November.

In its plea, the Tamil Nadu government contended that the ED's probe was politically motivated, and that the Central agency was seeking to conduct a roving inquiry through its summons.

Senior advocate, Dushyant Dave, who appeared for the state government, questioned why the ED was not taking similar action in Bharatiya Janata Party (BJP)-ruled states, where there were a large number of reported illegal mining cases.

“If they are concerned, then why has there been no action in BJP-ruled states such as Uttar Pradesh and Maharashtra, which have hundreds illegal mining cases?” Dave asked.

He asserted that he would ask the Tamil Nadu government to withdraw its petitions if the ED took similar action in other states.

Dave had argued that the issue of summons by the ED was an abuse of process of law. He further submitted that the predicate offence was against local miners and that the state government alone had the power to act in the matter. The senior lawyer added that if the Court did not intervene to halt the ED's summons, governance in the state would become impossible.

Meanwhile, Additional Solicitor General ARL Sundaresan appeared for the ED and opposed the state government's plea. He said that several FIRs have been registered in different districts in relation to illegal mining, which also involved scheduled offences under the Prevention of Money Laundering Act (PMLA).

During the hearing, the bench questioned the general information demanded by the ED. “When you ask for this kind of general information - 'give us all FIRs registered on illegal mining over the last five years all over Tamil Nadu' - then it becomes a problem," observed the bench a Bench of Justices SS Sunder and Sunder Mohan.

Sundaresan claimed that when illegal mining is involved, the money generated from such activities would be considered “proceeds of crime”, meaning that the ED would have jurisdiction over such cases. "Why should the State government shield somebody?" he argued further. Dave countered stating that the state government was not shielding anyone.

The bench said that the Court would pass orders on the issue of interim relief on Tuesday, November 28.

On Friday, the Madras High Court had agreed to hear five writ petitions filed jointly by the state government and the Collectors of Ariyalur, Karur, Vellore, Thanjavur and Tiruchi districts challenging the summons issued to them by the Directorate of Enforcement (ED) on November 17.

The bench had accepted a request made by Advocate-General R Shunmugasundaram for an early hearing of the case since it was related to “interference by the central investigating agency” into affairs that were exclusively within the domain of the state government.

Filing identical affidavits in all five writ petitions, Public Department Secretary K Nanthakumar said the ED had asked the Collectors to appear in person, along with their Aadhaar cards, on different dates and produce all the details related to the sand mines located in their districts.

The summons also required the Collectors to produce details regarding the names of sand mining sites in their districts, the complete address of the quarries, their GPS coordinates, the GPS address of the sand depots, the GPS coordinates of the depots, the permitted area of mining and the permitted depth.

The secretary stated that the Collectors had no clue about any Enforcement Case Information Report (ECIR) having been registered by the ED under the Prevention of Money Laundering Act (PMLA), 2022, with regard to sand mining in the state, and added that no such ECIR had been served upon them.

Even if an ECIR had been registered, Nanthakumar said, it could not be done because illegal sand mining was not a scheduled offence under PMLA. He said the summons had been issued illegally with a view to harassing and undermining the state machinery.

“It is believed that around 50 FIRs of illegal sand mining have been registered in Madhya Pradesh in 2022-23, while in Gujarat, around 38,100 cases of illegal sand mining have been registered between 2015 and 2020. However, the ED has not shown any inclination to investigate in these States,” read the state government’s affidavit