Back
2026 Supreme(Mad) 1226
IN THE HIGH COURT OF JUDICATURE AT MADRAS
SUSHRUT ARVIND DHARMADHIKARI, CJ., G.ARUL MURUGAN, J.
Arappor Iyakkam, Rep. by its Managing Trustee Jayaram Venkatesan – Petitioner
Versus
The Director –Respondent
W.P.No.8166 of 2024; W.P.(Crl.) No.396 of 2025 and W.P.(MD) No.26676 of 2025 and WP (Crl.) MP No.184 of 2025
Decided On : 29-04-2026
For the Petitioner:Dr.V.Suresh For Respondents: Mr.N.R.Elango, Senior Counsel for Mr.E.Raj Thilak and Mr.K.M.D.Muhilan Additional Public Prosecutors
For the Respondent:Mr.P.Kumaresan, Additional Advocate General assisted by Ms.E.Ranganayaki, AGP., Mr.J.Srinivasa Mohan for M/s.TVJ Associates, Mr.V.Karthic Senior Counsel for Mr.Senthil.S.
Procedural lapses in delayed, selective preliminary enquiry in corruption case involving public procurement justify transfer of investigation to independent agency like CBI to ensure fairness and public confidence.
Headnote:(A) Criminal Procedure Code, 1973 - Sections 154, 157 - Prevention of Corruption Act, 1988 - Section 17A - Tamil Nadu Transparency in Tenders Act, 1998 - Sections 10(5), 12, 29A - Constitution of India - Article 226 - Writ petitions seeking directions for registration of FIR and constitution of Special Investigation Team in allegations of collusive bidding and overpricing in public procurement of distribution transformers causing loss to exchequer - Directorate of Vigilance conducted preliminary enquiry beyond timelines (3 years from complaint), limited to one official despite multiple named accused, and abruptly closed it while matter pending before court - Held, preliminary enquiry permissible but time-bound (max 6 weeks); excessive delay, selective scope, and full-scale probe under guise of preliminary enquiry vitiate process - Transfer of investigation to independent agency warranted where procedural lapses raise apprehension of bias, especially involving high officials - Investigation transferred to Central Bureau of Investigation for de novo probe. (Paras 24, 28, 43, 46, 55, 60)
(B) Preliminary Enquiry in Corruption Cases - Scope limited to ascertaining cognizable offence; not mini-trial - Mandatory timelines (2 months per Vigilance Manual; 3+1 months prior approval under PC Act) - Deviation indicates cover-up - Court to intervene for fair investigation preserving public confidence. (Paras 38, 47-48, 50)
Facts of the case:
Petitions filed seeking mandamus for FIR registration and SIT investigation into alleged cartelization in tenders for distribution transformers (2021-2023), with identical bids from multiple bidders at rates higher than market, causing huge loss - Authorities conducted delayed, selective preliminary enquiry closed without substantiating cognizable offence.
Findings of Court:
Procedural irregularities including inordinate delay, narrow focus on single official, and comprehensive investigation masquerading as preliminary enquiry undermine credibility - Necessity for independent probe to ensure fairness.
Issues: Whether mandatory FIR registration required or preliminary enquiry justified; validity of delayed/selective enquiry closure; need for transfer to independent agency.
Ratio Decidendi: In corruption allegations disclosing cognizable offence, preliminary enquiry permissible but strictly time-bound and limited; gross procedural violations justify transfer to CBI to instil public confidence and uphold rule of law, without opining on merits.
Result: Writ petitions allowed - Investigation transferred to CBI for de novo probe; all materials to be handed over within 2 weeks.
| Table of Content |
|---|
| 1. details of writ petitions filed. (Para 1 , 2 , 3 , 4 , 5) |
ORDER :
SUSHRUT ARVIND DHARMADHIKARI, CJ.
1.W.P.No.8166 of 2024 has been filed by the petitioner/Arappor Iyakkam seeking issuance of a writ of mandamus directing the first respondent to register an FIR on the basis of the petitioner's complaint dated 6.7.2023 and to constitute a Special Investigation Team by this Court and, consequently, to direct the Special Investigation Team to conduct a time-bound, independent, High Court monitored fair investigation under the Prevention of Corruption Act, 1988, Indian Penal Code and other connected Acts.
2. W.P.(Crl.) No.396 of 2025 has been filed by the petitioner, who is a Deputy Secretary of AIADMK Advocate Wing, seeking issuance of a writ of mandamus directing the first respondent to register an FIR on the representation dated 28.5.2025 and to constitute a Special Investigation Team to conduct a time-bound investigation.
3. W.P.(MD) No.26676 of 2025 has been filed by the petitioner, who is stated to be a member of AIADMK party, seeking issuance of a writ of mandamus directing respondents 1 and 2 to take appropriate action against respondents 3 to 6 by conducting fair and thorough enquiry by constituting a Special Investigation Team based on the petitioner’s representation dated 12.8.2025.
4. Since the prayer made in these writ petitions and the issues involved are one and the same, these writ petitions were heard analogously and are disposed of by this common order.
5. The core of this controversy centers on the procurement process for electrical Distribution Transformers of varying capacities. The petitioners contend that these contracts were awarded at exorbitant rates, significantly surpassing prevailing market valuations, resulting in a substantial and unjustifiable loss to the public exchequer. Despite complaints detailing specific allegations of malfeasance against the parties involved, the relevant authorities have failed to register the FIR and conducted a detailed enquiry in the garb of preliminary enquiry against a single person, ignoring even a preliminary enquiry against many other persons named in the complaints, with inordinate and unexplained delay of over three years. Therefore, left with no option, the present petitions are filed.
RELEVANT FACTS:
W.P.No.8166 of 2024:
6.1. The case of the petitioner is that on 6.7.2023, the petitioner submitted a complaint to the first respondent/Directorate of Vigilance and Anti-Corruption regarding a massive scam, which was estimated to the tune of Rs.397 Crores, in procurement of Distribution Transformers by the TANGEDCO. The public servants and private parties had colluded and manipulated the entire tender process by procuring Distribution Transformers at exorbitant rates, much higher than the market price resulting in huge loss to the exchequer thereby unjustly enriching the business groups.
6.2. The petitioner analysed 10 tenders invited by the TANGEDCO for procurement of a total of 45,800 Distribution Transformers of varying specifications during the period 2021 to 2023 and found that in 7 of these 10 tenders, while as many as more than 20 bidders were shown to have participated, the tender process was vitiated by an obvious and orchestrated cartelization among the bidders and it is seen that every single bidder submitted a quote that was identical to the last decimal point.
6.3. It is averred that the Tender Scrutinizing Committee actively aided the collusive bidding and awarded tenders to the bidders by splitting the tender equally amongst them at rates exorbitantly higher than the prevailing market rates, which resulted in unjust enrichment totalling about Rs.397 Crores to private parties at the expense of public exchequer.
6.4. It is further stated that though the first respondent through its letter dated 22.8.2023 had informed the petitioner that necessary action as per law will be taken on the complaint, yet the first respondent has not registered an FIR as ma
