MHC stays summons issued by ED in illegal sand mining allegation

CHENNAI: The Madras High Court has granted a stay to the operation of the summons issued by the Enforcement Directorate (ED) to private sand miners, in connection with the money laundering alleged with illegal sand mining.

A division bench comprising Justice SS Sundar and Justice Sunder Mohan heard a batch of petitions preferred by A. Rajkumar, Shanmugam Ramachandran, and Rethinam, working partners of R.S.Construction against the Enforcement Case Information Report (ECIR) registered by ED.

The petitioners contended that the State had filed writ petitions challenging the ED's action and had obtained an interim stay to the summons issued to the collectors of Ariyalur, Karur, Thanjavur, Trichy, and Vellore districts.

It was also contended that the ECIR registered by the ED should be quashed as the investigation undertaken by the ED amounted to a gross abuse of the law.

Allowing the ED to continue with the investigation would amount to an infringement of his fundamental right to life and personal liberty, said the petitioners.

Additional Solicitor General (ASG) AR.L. Sundaresan, who appeared for ED, opposed the plea to quash the ECIR registered on the basis of predicate offenses being investigated by the State vigilance directorate.

The ASG submitted that the ECIR was only an internal record and not a legal document to be challenged by way of a writ petition.

He also pointed out that the three petitioners had not sought a stay against the summons issued to them and said the investigation was at an initial stage and hence the petitioners must cooperate.

The ED requires certain clarifications from the petitioners regarding the materials collected and needs to record their statements before proceeding further, the ASG added.

The ED has been conducting an investigation in sand quarries across the State since September, looking into allegations that a large quantity of sand was excavated from riverbeds and sold illegally bypassing the online sales mechanism thereby causing a huge loss to the State exchequer.

Subsequently, on September 11, 2023, the ED registered ECIR against the petitioners.