ED attaches Tamil Nadu minister Ponmudy’s FD worth Rs 41.9 crore

Tamil Nadu Higher Education Minister K Ponmudy appeared before the Enforcement Directorate (ED) for the second consecutive day in connection with a 11-year-old case, even as the agency said it has frozen fixed deposits of Rs 41.9 crore and recovered foreign currency during the day-long searches.

Ponmudy and his son, Gautham Sigamani who is the DMK MP from Kallakurichi, appeared before the ED on Tuesday evening, after the first round of questioning went through Monday night. 

“During the searches, various incriminating documents, cash amounting to Rs 81.7 lakh, foreign currency (British pounds) equivalent to approx. Rs 13 lakh was seized and fixed deposits of Rs 41.9 Crore have been frozen,” the ED said. 

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Ponmudy and his son are under the ED scanner in connection with a 11-year-old case of illegal red sand quarrying. The raids are related to a 2012 case filed during the then AIADMK regime alleging that Ponmudy, as minister of mines and resources in 2007 during the DMK regime, obtained licenses for quarrying of red sand in the name of his son, Sigamani and relatives, disregarding several rules and regulations. 

The allegations also include that mined more sand than allowed by the government – 2.64 lakh loads – causing a loss of Rs 28 crore to the exchequer. The Directorate of Vigilance and Anti-Corruption (DVAC), which filed the case in 2012, had Ponmudy, but he was later released. 

The raids also come weeks after Ponmudy was acquitted by courts in a disproportionate assets (DA) case and a land grabbing case. 

This is not the first time Ponmudy’s family has come under the ED scanner – his son Sigamani’s properties worth Rs 8.60 crore were seized in October 2020 for illegally acquiring foreign security without approval from the Reserve Bank of India (RBI) by Foreign Exchange Management Act, 1999 (FEMA).

The ED had said it issued a seizure order under Section 37A of Foreign Exchange Management Act, 1999 (FEMA) seizing properties held by the DMK MP to the tune of Rs 8.60 crores, equivalent to the value of the illegally acquired foreign security and non-repatriation of foreign exchange earned abroad till date.

Ponmudy, deputy general secretary of the DMK, is placed fifth in the pecking order of the Council of Ministers headed by Stalin. A senior leader having served in every party-led dispensation since 1989, Ponmudy quit as professor to contest the assembly elections in 1989 after having been involved with the DMK since his student days.