The Enforcement Directorate (ED) has uncovered a liquor scam involving DMK Minister V Senthil Balaji and other senior figures from the ruling party. Balaji, who oversees the Electricity, Prohibition, and Excise departments, is under investigation after ED raids indicated collusion between politicians, officials, and distillery owners.
Distilleries across Tamil Nadu are accused of inflating expenses and fabricating purchases, particularly through bottle-manufacturing companies, to funnel around Rs 1,000 crore into untraceable funds and shell companies. These illicit funds were allegedly used for kickbacks to secure inflated supply contracts with the Tamil Nadu State Marketing Corporation Limited (TASMAC).
Balaji responded, saying, "I will face this legally. The specific FIR details mentioned in the ED statement are missing. There are no irregularities. They are creating an image as if there are irregularities."
The ED's investigation, which included raids on state-owned entities like TASMAC, has exposed a broader illegal network involving politicians, bureaucrats, and businessmen. This scam bears similarities to a similar one uncovered in Chhattisgarh.
.TASMAC's Role in the Scandal
The Enforcement Directorate (ED) revealed in a statement that incriminating evidence was found during searches at TASMAC offices, including data on transfer postings, transport tenders, bar license tenders, and indent orders benefiting specific distillery companies. Evidence also showed TASMAC outlets charged Rs 10-30 extra per bottle, involving TASMAC officials.
Further investigation into the bar license tenders indicated manipulation of conditions, with tenders awarded to applicants lacking essential documents like GST/PAN numbers and valid KYC details. Communications between distillery companies and senior TASMAC officials also pointed to efforts to secure inflated orders and undue advantages.
"A major issue is the mismatch between the applicant's KYC details and the Demand Draft (DD), suggesting the final bidder did not even obtain the necessary DD before the deadline. Moreover, tenders were awarded despite only a single applicant. TASMAC paid over Rs 100 crore annually to transporters," the statement read as per a report by News 18.
Fraudulent Expense Inflation
Investigations by the Enforcement Directorate (ED) have revealed a large-scale financial fraud involving distillery companies like SNJ, Kals, Accord, SAIFL, and Shiva Distillery, along with bottling firms such as Devi Bottles, Crystal Bottles, and GLR Holding.
The scheme involved distilleries inflating expenses and creating fake purchases, particularly through bottle-making companies, laundering over Rs 1,000 crore in unaccounted funds. These funds were then funneled into kickbacks to secure inflated supply orders from TASMAC.
Bottling companies played a crucial role by inflating sales figures, enabling distilleries to route excess payments, which were withdrawn in cash. Commissions were deducted before the money was returned. This collusion involved manipulating financial records, concealing cash flows, and systematically evading regulations.
