The Directorate of Vigilance and Anti-Corruption (DVAC) has assured the Madras high court that it will conduct a “proper and full-fledged inquiry” into serious corruption allegations levelled by the Enforcement Directorate (ED), against the municipal administration and water supply department, headed by the senior DMK minister KN Nehru.
The assurance comes amid mounting pressure from Opposition parties and two separate ED complaints pointing to large-scale irregularities, including a cash-for-jobs racket and a ₹1,020-crore tender manipulation scam involving hawala transactions to Dubai.
Large-scale irregularities
The controversy traces its roots to ED raids conducted in April 2025, as part of a bank fraud investigation involving True Value Homes Pvt Ltd, a company linked to minister Nehru’s brother, KN Ravichandran. During the searches in Trichy, Coimbatore and Chennai, the agency seized digital evidence, including Excel sheets, WhatsApp chats, handwritten ledgers and hawala chits, which allegedly revealed two distinct corruption networks operating within the municipal administration department.
In October 2025, the ED forwarded a detailed complaint to Tamil Nadu police, sharing 232 pages of evidence related to an alleged cash-for-jobs scam.
The agency claimed that thousands of irregular appointments were made in the municipal corporations and town panchayats in exchange for bribes, with payments reportedly routed through Ravichandran’s firm.
Earlier estimates pegged the scale of the alleged racket at around ₹888 crore.
ED's interventions
After a division bench of the Madras high court quashed the original Enforcement Case Information Report in the bank fraud matter in July 2025, the ED retained copies of seized material and shared it with the state director-general of police on October 27, 2025, urging action on cognisable offences under state laws.
In a subsequent development, the ED submitted a 258-page dossier alleging a massive ₹1,020-crore kickback scheme in municipal contracts. The agency claims tenders for underground drainage projects, public toilets, sanitation worker outsourcing, NABARD-funded works, pond renovations and housing schemes were systematically manipulated.
Seized records from just two middlemen over two years allegedly indicated collections exceeding ₹1,000 crore, suggesting the actual figure could be significantly higher.
Digital evidence allegedly includes photographs showing Nehru with key players in the network, and spreadsheets with a column marked “Party Fund” hinting that part of the illicit money may have been diverted to the ruling DMK. Hawala slips allegedly pointed to funds being routed to Dubai and other destinations.
The ED has demanded the registration of an FIR under the Prevention of Money Laundering Act and related provisions.
The two writ petitions
Two writ petitions, one filed by Madurai resident K Athinarayanan and another by AIADMK Rajya Sabha member IS Inbadurai, sought court directions for the DVAC to immediately register an FIR based on the ED’s evidence.
During hearings before a division bench comprising Chief Justice Manindra Mohan Shrivastava and Justice G Arul Murugan, DVAC counsel NR Elango, assured the court that the agency is treating the ED communication as the “first information”, and has already commenced a detailed preliminary inquiry as per the Vigilance Manual.
The probe, he said, is being conducted without preconceived notions, and additional material will be sought from the ED if required.
The outcome will be submitted to the state government within 180 days. The senior counsel appearing for the petitioners argued that Supreme Court precedents mandate immediate FIR registration in cases involving evidence of cognisable offences, while the advocate general emphasised the government’s prompt forwarding of the ED complaint to DVAC.
The Bench reserved orders after hearing all sides.
DMK refutes allegations
The DMK has strongly rejected the allegations, terming them a “politically motivated vendetta” orchestrated by the BJP-led Central government. "I have not committed any mistake," said Nehru. "I am ready to face the case legally. We will prove through the court that we have done nothing wrong."
Advocate RS Bharathi, a former DMK MP, said the Union government is trying to "neutralise" Nehru, who is in charge of 41 constituencies. He will not fear any threats, he added.
Opposition welcomes move
AIADMK's Inbadurai emphasised that the court’s intervention validates the AIADMK’s demand for swift action against the alleged large-scale corruption in the municipal administration Department.
Former Tamil Nadu BJP president K Annamalai welcomed the Madras high court's reported directive to register an FIR against Nehru, calling it a vindication of the ED's repeated alerts. He pointed out that the ED had flagged three separate corruption cases totalling over ₹2,300 crore in a single department within one year, accusing the DMK government of deliberately delaying action.
He challenged Chief Minister MK Stalin to explain the inaction and demanded immediate FIRs in the remaining cases, warning that silence would imply the CM's complicity.
