S Jagathratchakan, a 76-year-old DMK MP representing the Arakkonam Lok Sabha constituency in Tamil Nadu, has been slapped with a whopping Rs 908 crore penalty by the Enforcement Directorate (ED) for violating foreign exchange rules under the Foreign Exchange Management Act (FEMA). This latest action, announced on Wednesday, follows a prolonged investigation into Jagathrakshakan’s financial dealings under FEMA.


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The ED’s adjudication order, dated August 26, 2024, comes after the agency seized assets worth Rs 89.19 crore belonging to Jagathrakshakan and his associates in September 2020. These assets, which include both movable and immovable properties, have now been formally confiscated. The massive penalty imposed highlights the scale of the alleged violations and underscores the severity of the enforcement action taken against the veteran politician.


Who is S Jagathratchakan?


Jagathratchakan is a three-time Lok Sabha MP from the Arakkonam constituency, first elected in 1999. He served as the Minister of State for Commerce and Industry in the UPA government during Dr. Manmohan Singh's tenure. A Tamil businessman, Jagathratchakan is the chairman of Shree Balaji Medical College and Hospital and the owner of Dr. Rela Hospital and Institute.


Jagathrakshakan is a notable Tamil businessman with substantial interests in the medical and hospitality sectors. His business ventures include his roles as the chairman of Shree Balaji Medical College and Hospital and the owner of Dr. Rela Hospital and Institute. His rapid asset accumulation has drawn scrutiny, with a notable increase from Rs 5 crore in 2009 to Rs 70 crore by 2011, marking one of the highest percentage increases among ministers at the time.


Controversies Surrounding Jagathratchakan


Jagathrakshakan’s financial and political trajectory has been marred by controversies. In 2012, he faced allegations related to the coal scam in Tamil Nadu, accused of facilitating illegal coal allocations to his company. Furthermore, a sting operation revealed inflated fees being charged to MBBS students at his medical college.


The controversies continued into recent years. In 2019, an international investment project involving Jagathrakshakan’s family came under the spotlight. Sri Lanka’s Board of Investments announced a significant oil refinery project in Hambantota, with Jagathrakshakan’s family members listed as directors of the company financing the project. This raised questions about the source of the funds and led to further scrutiny by the ED for possible FEMA violations.