Madras High Court Quashes ED Money Laundering Case Against Ponmudy

The Madras High Court has quashed the Enforcement Directorate (ED) case under the Prevention of Money Laundering Act against former Tamil Nadu Minister K. Ponmudy, his son Gautham Sigamani and others in connection with an alleged red sand mining scam.
The case originated from allegations that excessive red sand mining in Villupuram district during the DMK government’s 2006–2011 tenure caused a loss of Rs. 28.36 crore to the State exchequer. The Directorate of Vigilance and Anti-Corruption registered a case against Ponmudy, Gautham Sigamani and their relative Rajamahendran.
Based on the underlying case, the ED registered a money laundering case, alleging that proceeds from the alleged illegal mining were transferred through hawala channels and invested in companies abroad.
In April, the Villupuram District Court acquitted Ponmudy and the other accused in the principal red sand mining case. Subsequently, Ponmudy and Gautham Sigamani approached the High Court seeking cancellation of the ED proceedings, arguing that they had been acquitted in the underlying case.A Bench comprising Chief Justice S.A. Dharmadhikari and Justice G. Arul Murugan accepted the plea, ruling that the ED case could not continue following the acquittal in the principal case. Citing Supreme Court rulings in other cases, the Bench ordered the money laundering proceedings against Ponmudy and the others to be quashed.