Madras High Court Summons ED Assistant Director In Contempt Plea For Continuing PMLA Probe Despite HC Stay Order

The bench of Justice MS Ramesh and Justice V Lakshminarayanan issued notice asking the Assistant Director to appear before it on September 17.

The bench expressed its displeasure after noting that the Assistant Director had issued a show-cause notice to the producer even after being aware of the interim order passed by the bench staying all further proceedings in connection with the PMLA case.

“There's a limit. He was present in court when the order was made”, the court orally remarked while summoning the officer

“We do not appreciate the manner in which the respondent had violated the orders of this Court, in spite of the fact that he was fully aware of the operation of the interim order of stay,” the court had previously noted.

The court had also fined the Directorate Rs. 10,000 each in three petitions filed by film producer Akash Bhaskaran and businessman Vikram Ravindran against the ED's search conducted at their residence and office. The fine was imposed after the Directorate failed to file a counter affidavit despite being given a last opportunity by the court.

Today, Additional Solicitor General SV Raju submitted that the Directorate intended to file an appeal against the order imposing cost for failure to file counter affidavit. The bench was also informed that an application had been filed in the High Court seeking a waiver of the fine imposed.

The producer and the businessman had moved the court challenging the ED Action. It was alleged that the ED had sealed the residential flat and the office of the petitioners since it was locked at the time of the search.

The court had then directed the Directorate to produce the documents based on which the ED had initiated the action. On perusing the documents, the court held that the authorisation based on which the ED had conducted searches at the offices and residences of the petitioners was prima facie without jurisdiction since there was no incriminating material against them. The court also observed that the materials produced by the ED had no semblance of any information on which the ED had decided to take action against the petitioners.

The court had thus, on June 20, 2025, stayed all proceedings initiated by the ED against the petitioners.

The present contempt petition was filed by Baskar contending that despite the order, he had received a show cause notice from the Adjudicating Authority, together with a covering letter dated July 11, 2025 sent by Vikas Kumar, enclosing a copy of the Recording of reasons under Section 8(1) of the PMLA and a note for compliance with reference to the notice under Section 8(1), a copy of the original application and one set of relied upon documents.

When the Special Public Prosecutor submitted that the show cause notice might have been issued due to an oversight, the court said that the officer could appear in person so that the bench could make him aware of the procedure and prevent such oversight in the future.

The court thus summoned the officer to appear before it on September 17.

Case Title: Akash Baskaran v The Joint Director and Others

Cont P: 2708 of 2025