Madras HC stays ED summons to five Collectors in Tamil Nadu

Madras HC stays ED summons to Collectors for sand quarry details; judges agree with TN govt's contention that ED cannot engage in fishing expedition to identify proceeds of crime. ECIR registered on Sept 11, 2023 based on 4 FIRs related to illegal sand mining. ED yet to receive details from TN DGP. Judges prima facie convinced summons not within ED's jurisdiction & just an attempt to investigate possibility of proceeds of crime. Final hearing of 10 writ petitions on Dec 21.

The Madras High Court on November 28 stayed the summons issued by the Directorate of Enforcement (ED) on November 17 to the Collectors of Ariyalur, Karur, Thanjavur, Tiruchi and Vellore for producing details regarding all sand quarry sites in their districts.

Justices S.S. Sundar and Sunder Mohan, prima facie, agreed with the Tamil Nadu government’s contention that the ED, acting under the Prevention of Money Laundering Act (PMLA) of 2002, could not engage in a fishing expedition to identify possible proceeds of crime.

The judges said, existence of a predicate offence as well as the proceeds of crime were quintessential for initiating proceedings under the PMLA whereas in the present case, the ED had sought details from the Collectors to find out whether any offence had been committed at all.

Dictating the order in open court, Justice Sundar pointed out the ED had registered an Enforcement Case Information Report (ECIR) on September 11, 2023 with regard to alleged laundering of the proceeds of rampant illegal sand mining reportedly taking place in Tamil Nadu.

The ECIR was based on four First Information Reports (FIRs) registered by the State police in connection with sand mining cases. However, curiously, the first FIR was related to the murder of a Village Administrative Officer who attempted to prevent illegal sand mining at Orathanadu in Thoothukudi district.

The second FIR was related to seizure of ₹1.5 lakh of unaccounted money by the Directorate of Vigilance and Anti Corruption sleuths from the office of the geology and mining department officials in Dindigul district. The other two FIRs were also of similar nature.

Though the ED had written to Tamil Nadu’s Director General of Police/head of police force on October 17, 2023 seeking details of all FIRs registered in connection with illegal sand mining in the State in the last five years, it was yet to be provided with such details.