Current Affairs: Passage of the Week - 26 May 2025 | Current Affairs & General Knowledge - CLAT PDF Download

Directions: Read the passage carefully and answer the questions that follow.
Warning the Enforcement Directorate that it was “crossing all limits” and “violating the federal structure”, the Supreme Court Thursday stayed proceedings in the agency’s money-laundering investigation into government-run liquor retailer Tamil Nadu State Marketing Corporation (TASMAC).
The bench of Chief Justice of India B R Gavai and Justice A G Masih, which was hearing the Tamil Nadu government’s plea challenging the ED searches at the TASMAC headquarters, sought a reply from the probe agency within two weeks.
Appearing for the state, Senior Advocate Kapil Sibal said the corporation had found that some people who had been allotted liquor outlets were taking cash. “So the state itself filed 41 FIRs from 2014 to 2021. Against individuals, not against the corporation. The ED comes into the picture in 2025 and raids the corporation, the head office,” he said.
Issuing notice, CJI Gavai asked Additional Solicitor General S V Raju, who appeared for the ED: “How can (there be) an offence against the corporation?… You may register (an offence) against individuals, how  (against the) corporation in a criminal matter?”
“Your ED is crossing all limits, Mr Raju,” CJI Gavai said, and asked the ED to file a reply in two weeks.
The bench directed that in the meantime, there will be a stay on further proceedings against the petitioners.
Senior Advocate Mukul Rohatgi, appearing for TASMAC said the agency had taken the phones of employees and cloned them.
Sibal and Rohatgi urged the court to direct the ED not to use the data collected. “They have taken our data. The data cannot be used,” Sibal said. “There is something called privacy,” Rohatgi said.
Raju said it was a case of fraud of Rs 1,000 crore involving politicians.
“We have already protected you. We cannot grant you more than what you are praying for,” CJI Gavai said.
Turning to the ASG, the CJI said the state had already filed FIRs.  “Why should the ED unnecessarily… and where is the predicate offence?”
Raju said there is nothing malafide in the ED probe and that he would file an affidavit. The CJI said the court would hear the matter once the reply was filed.
Before closing the hearing, he said, “You are totally violating the federal structure…  ED is crossing all limits.” At this, Raju said, “It is not so in this case.”
In March, the ED had conducted searches at TASMAC offices amid a large-scale investigation into alleged corruption and financial irregularities within the body, which oversees liquor sales in Tamil Nadu. ED officials searched 20 locations, including the corporation’s headquarters in Chennai, between March 6 and March 8.
On April 23, the Madras High Court dismissed pleas filed by the State of Tamil Nadu and TASMAC challenging the ED’s searches. The High Court also rejected claims that TASMAC officials were harassed by ED during the searches.
[Excerpt from Indian Express "SC Stays ED’s TASMAC Investigation" Dated 26/05/25]

Q1: Why did the Supreme Court of India pause the Enforcement Directorate’s investigation into TASMAC?
(a) Due to lack of evidence in the corruption case
(b) Because TASMAC is a private entity
(c) Over concerns about federal overreach and prosecuting a corporation instead of individuals
(d) Because TASMAC requested time to restructure its operations

View Answer  

Ans: (c)
Sol: The Supreme Court paused the investigation because of concerns that the ED was overstepping its authority and prosecuting a corporation rather than individual officials, raising issues about the federal structure.

Q2: What is the main function of TASMAC?
(a) Manufacture of alcoholic beverages
(b) Import and export of liquor
(c) Retail sale of liquor in Tamil Nadu
(d) Monitoring the health impacts of alcohol consumption

View Answer  

Ans: (c)
Sol: TASMAC is a government-owned entity responsible for the retail sale of liquor in Tamil Nadu.

Q3: What financial wrongdoing is TASMAC accused of?
(a) Money laundering through international banks
(b) Selling illegal liquor brands
(c) Corruption involving overcharging and bribery
(d) Evading state taxes on alcohol sales

View Answer  

Ans: (c)
Sol: TASMAC is accused of financial irregularities including overcharging customers and bribery among officials.

Q4: How much financial fraud did the ED reportedly uncover in its investigation of TASMAC?
(a) Rs. 500 crore
(b) Rs. 1,000 crore
(c) Rs. 2,500 crore
(d) Rs. 750 crore

View Answer  

Ans: (b)
Sol: The ED claims to have uncovered fraud amounting to Rs. 1,000 crore involving several politicians.

Q5: What political issue surrounds the ED’s investigation into TASMAC?
(a) Conflict between state and private liquor companies
(b) Protests by TASMAC employees
(c) Allegations of political bias against the central government
(d) Support from all political parties for the ED’s actions

View Answer  

Ans: (c)
Sol: The ruling party in Tamil Nadu sees the ED’s actions as politically motivated, accusing the central government of interfering in state matters.