The Madras High Court has expressed skepticism over the Tamil Nadu government’s decision to allocate about ₹40 crore for the Formula-4 night street races scheduled on December 9 and 10 in Chennai. The court’s concern centers on the benefit of this substantial expenditure to private parties organizing the event, rather than to the public at large.
During the hearing of a series of petitions aimed at halting the races due to safety concerns, a division bench consisting of Justice R Mahadevan and Justice Mohammed Shaffiq sought clarity from the state government. The bench directed the government to present, by the following Monday, any Memorandum of Understanding (MoU) concerning revenue sharing associated with the event.
Senior Advocate V Raghavachari, representing one of the petitioners, questioned the legal basis for such funding. He argued,
“The State Town Planning Act only provides for funding for development activities and a racing event organized by private bodies cannot be considered as a development activity.”
This statement challenges the rationale behind the government’s financial involvement in the event.
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In defense, Advocate-General R Shunmugasundaram compared the situation to the Indian Premier League (IPL), where the state had previously invested more than ₹1,000 crore. He explained that such investments were recovered through profit-sharing arrangements with the event organizers.
“We have an agreement with the private bodies to share the revenue generated from the races,” Shunmugasundaram stated, justifying the expenditure.
Furthermore, Advocate Preetika Dwivedi, also representing the petitioners, raised additional concerns about the event’s potential impact on the local community. She highlighted issues related to sound pollution, safety, and environmental threats to residents as a result of the racing event.
The court’s directive for the state and private organizers to produce the MoU is a step towards understanding the financial dynamics of the government’s involvement in the event. This case underscores the need for greater transparency and justification when public funds are allocated to privately organized events, especially in contexts where the public benefit is not immediately apparent.
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