Prime Minister Indira Gandhi, who declared the national Emergency on June 25, 1975, dismissed the DMK government led by M. Karunanidhi on January 31, 1976, using Article 356, citing sugar and rice corruption scandals.
By late 1972, the Dravidian movement had shifted from partnership to rivalry following M.G. Ramachandran's (MGR) expulsion from the DMK. In the early 1970s, MGR accused the DMK of sugar and rice purchase scandals, suggesting misuse of procurement for party funds and personal gain. The administration dismissed these as fabrications, but the Sarkaria Commission later investigated, lending weight to the claims. MGR petitioned the governor and prime minister with evidence of fiscal leaks.
In August 1971, Chief Minister M. Karunanidhi lifted prohibition, arguing Tamil Nadu could not remain a 'solitary island of camphor' amid 'wet' neighboring states, to boost revenue for welfare. On a rainy day that year, 92-year-old C. Rajagopalachari (Rajaji) pleaded at Karunanidhi's residence against unleashing liquor on the poor and youth, but Karunanidhi held firm, stating the economy could not be 'burnt by the fire' of neighbors.
The 1974 Katchatheevu handover to Sri Lanka via the Indo-Sri Lankan Maritime Agreement, agreed by Karunanidhi to settle boundaries and maintain ties with Indira Gandhi's government, drew criticism. Karunanidhi claimed he registered a 'strong protest' with Delhi, but it was seen as a sovereignty sacrifice for political peace, fueling opposition attacks.
The Maintenance of Internal Security Act (MISA) was initially used by the DMK against ADMK voices. But on June 25, 1975, when Emergency was declared, Indira Gandhi's government turned MISA against DMK leaders, including a young M.K. Stalin, who was incarcerated and reportedly beaten. Karunanidhi defied the Emergency, holding massive rallies on Marina Beach and using his newspaper Murasoli to subtly mock censorship.
On January 31, 1976, invoking Article 356, Indira Gandhi dismissed the DMK government, citing scandals and Sarkaria findings as pretext for a political purge—the first such use against a major southern regional government. Mass arrests followed, with reports of torture in Central Jail. Former mayor and MP Chittibabu died from injuries while protecting prisoners, including Stalin, marking a tragic chapter.
MGR maintained distance from the Emergency, using films like Ulagam Sutrum Valiban as political tools to build his image as Anna's true heir. By 1977, after Emergency's lift, AIADMK swept elections, routing DMK and beginning MGR's 13-year rule. This shifted Dravidian politics into rival streams, weakening national parties like Congress in Tamil Nadu.