The Madras high court on Thursday refused anticipatory bail to former Tamil Nadu minister V Senthil Balaji in a corruption case the Directorate of Vigilance and Anti-Corruption (DVAC) has registered against him, saying the allegations against him involved a loss of over ₹17 crore to the public exchequer and required custodial interrogation.
Justice GK Ilanthiraiyan dismissed Balaji’s petition seeking protection from arrest after the Tamilaga Vettri Kazhagam (TVK) government argued that the alleged ₹17 crore loss was only the tip of the iceberg and that the actual loss to the exchequer could exceed ₹100 crore.
Public prosecutor R John Sathyan told the court that custodial interrogation was essential to unearth the full extent of the alleged irregularities.
On Wednesday, the DVAC widened its probe into alleged corruption in the Tamil Nadu State Marketing Corporation (TASMAC). The DVAC searched 41 locations across the state and registered a fresh case against Balaji and six others. It also named former TASMAC managing director S Visakan, former senior regional managers T Rama Durai Murugan and R Panneer Selvam, former ministerial aide Bhaskar, and private individuals Rathesh Raj Shanmugavel and S Karthik as co-accused.
Investigators alleged that district and regional TASMAC officials manipulated tenders for bars and transport contracts, favoured selected bidders, enabled cartelisation among applicants and allowed bars to continue operating despite expired licences, causing substantial losses to the government.
{{/usCountry}}Investigators alleged that district and regional TASMAC officials manipulated tenders for bars and transport contracts, favoured selected bidders, enabled cartelisation among applicants and allowed bars to continue operating despite expired licences, causing substantial losses to the government.
{{/usCountry}}The agency alleged irregularities in bar tenders in Coimbatore, Tiruppur, Erode, Namakkal, the Nilgiris and Karur. It claimed that officials colluded with bar operators instead of conducting fresh tenders wherever required.
The agency alleged that transport contracts for 45 TASMAC depots were manipulated by misusing earnest money deposit demand drafts submitted by one applicant. Investigators claimed that unused demand drafts were diverted to help other transport contractors secure contracts.
The DVAC said tender procedures were deliberately bypassed through fraud, manipulation and illicit financial transactions. It alleged that licences were often controlled by third parties rather than successful bidders through organised syndicates. The agency referred to a “Karur gang”, claiming that it exercised influence over bar allotments across the state and pressured TASMAC officials in the allocation of licences.
The DVAC said the material collected so far established a prima facie case of criminal conspiracy, criminal breach of trust, cheating and abuse of official position under provisions of the Indian Penal Code, the Bharatiya Nyaya Sanhita and the Prevention of Corruption Act. It alleged that a nexus between political executives, senior TASMAC officials, private individuals and commercial entities manipulated decision-making within the corporation and caused significant loss to the public exchequer.
Senior advocate NR Elango, who appeared for Balaji, argued that there was no specific material implicating his client in the case. He pointed out that the Enforcement Directorate previously conducted a search operation in the TASMAC office, which was challenged in the high court and later the Supreme Court. Elango argued that the TASMAC is an independent body and that Balaji did not have a role in its tenders or functioning.
The state government argued that the previous Dravida Munnetra Kazhagam government tried to conceal the irregularities and thus, the accused needed to face custodial interrogation. “This needs elaborate custodial interrogation. Ample materials available. Huge amount of money involved and we do not know to what extent it will go,” Sathyan said.