Chennai: The Madras High Court Tuesday stayed summons issued by the Enforcement Directorate (ED) to five district collectors in connection with alleged illegal sand mining and money laundering case in Tamil Nadu.
It, however, has not put a stay on the ED investigation into alleged irregularities in sand mining.
The ED was given three weeks to respond to the pleas challenging its summons to the district collectors.
The writ petitions filed jointly by Public Department Secretary K. Nanthakumar and the collectors of Ariyalur, Vellore, Thanjavur, Karur, and Tiruchirappalli (Trichy) districts had two parts.
The first five writs challenged the ED summons to the district collectors, and the next five stated that the agency’s move challenged the federal structure of the Constitution as it had acted without the consent of the state government. ThePrint has a copy of the petitions.
After hearing the arguments Monday, the division bench comprising Justices S.S. Sundar and Sunder Mohan, in its interim order, said, “We are prima facie convinced that the summons is not within the jurisdiction of ED.”
It also added that the state government’s plea that central agencies are being used against non-BJP states was maintainable.
“The respondent (ED) has launched a fishing expedition to identify possible proceeds of crime from information that might be furnished before the respondent about illegal mining,” the bench said.
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Details of summons & state’s response
On Friday, advocate general R. Shunmugasundaram approached the court requesting for an early hearing in the cases as it was related to infringement of the state’s rights.
In the writ petition, which is identical, it was stated that the district collectors were served summons by the ED via email to appear on different dates.
According to the petition, the collectors were directed that they were to “appear in person, with the copy of their Aadhaar cards, and submit details of all sand mining sites in their districts with the following information — a) Name of the site; b) Complete address of the quarry; c) GPS coordinates of quarry; d) GPS address of depot; e) GPS coordinates of depot; f) Permitted area; and g) Permitted depth.”
The state challenged that the summons were illegal and alleged that the ED move was with the view to harass and undermine the state machinery by conducting a fishing and roving inquiry.
“Officials of the state are neither accused nor witnesses and, therefore, they cannot be summoned under the provisions of the Prevention of Money Laundering Act unless a notification under clause (j) of section 54 of PMLA specifying such officials was served. No such notification has been issued concerning district collectors till date,” it said.
Section 54 of PMLA pertains to the assistance of certain officers to the ED in inquiry and clause (j) talks about how by the notification the ED has to specify its request for the assistance of the official in the investigation.
Appearing for the state, senior counsel Dushyant Dave Monday argued that the ED had no jurisdiction over illegal sand mining as offences under the Mines and Minerals Act are not scheduled offences under the PMLA.
He alleged that only non-BJP states were facing such problems, which was “violative of federal principles”.
Dave noted that no action was taken by the ED in illegal sand mining offences in other BJP states like Uttar Pradesh (8,000 cases), Maharashtra (4,000 cases) and Haryana (4,500 cases).
The writ petition noted that “between 2022 and 2023 in Madhya Pradesh, around 50 FIRs of illegal sand mining have been registered, while in Gujarat, around 38,100 cases of illegal sand mining were registered between 2015 and 2020”, but no investigation was initiated.
“Under the garb of exercising powers under the PMLA, the authorities acting under it cannot initiate action in matters wherein they have no jurisdiction. Such action/exercise of power would be vitiated on account of malice in law,” it contended.
“The actions impugned (under challenge) are taken for collateral, oblique and improper purposes and amount to colourable exercise of power.”
ED response in court
Additional Solicitor General A.R.L. Sundaresan noted that the ED had filed an Enforcement Case Information Report (ECIR) on 11 September, 2023 based on four FIRs that were registered in connection to illegal mining by the state police.
Appearing for the ED, he alleged that despite the ED seeking details on FIRs registered in the last five years regarding illegal mining from the Tamil Nadu police chief in October, there has been no reply so far.
The ED informed the court that the illegal sand mining in the last one-two years had a total sale value of Rs 4,730 crore, which was much higher than the recorded revenue of Rs 36.45 crore. It also accused the state of shielding the culprits.
The ASG also informed the court that IIT-Kanpur was appointed by the ED to estimate the volume of sand excavated from 28 mining sites in Tamil Nadu. The study found that around 24 lakh units of the mineral had been mined illegally in the past 1-2 years, he added.
(Edited by Richa Mishra)