Setting aside on earlier Karnataka High Court order, a two-judge bench of the Supreme Court on Tuesday convicted Sasikala in connection with a 19-year old disproportionate assets case.
For a third day in running, Sasikala went to meet the legislators backing her at the beach resort.
The ruling also means that no memorial can be built for Jayalalithaa - the actress-turned-AIADMK icon - and her photographs must be taken off from all government offices.
Palanisamy ranked next to O.Panneerselvam-the current caretaker chief minister-in Jayalalithaa's cabinet. However on February 7, Panneerselvam openly rebelled against Sasikala.
Supporters of the main Tamil opposition party, however, celebrated, setting off firecrackers and distributing candies outside her Chennai residence.More news: Affordable Care Act Repeal Threatens Access to Preventive Care
She also had Mr Panneerselvam and his supporters expelled from the primary membership of the party. The Gounder community was a significant factor in the 2016 assembly elections. There are 20 MLAs from Mukkulathor community (Panneerselvam and Sasikala belong to the community), but 9 ministers. Previously, TNM had reported that the staff of the resort were forced to switch off their phones and even the MLAs had been restricted from communicating with people outside. This issue cropped up after the death of Jayalalithaa as the Goundar community demanded power or due share in the cabinet. Chinnamma, as she is popularly referred by her supporters, nominated her loyalist Edappadi Palaniswami as the leader of AIADMK legislature party.
However, the MLAs, whose support the Sasikala camp has claimed to have, continued to be protected inside the resort by tough looking men.
Attorney General Mukul Rohatgi, while speaking to NDTV, stated that the Governor should allow Palanisami to form government if he enjoys majority.
He was responding to reporters' queries to Palaniswami being elected the Legislature Party leader, hours after the Supreme Court upheld a trial court verdict against AIADMK General Secretary Sasikala in a disproportionate assets case.
These decades saw the growth of the wife of an assistant in the government publicity department, Sasikala Natarajan, as she was known then, and daughter of medical compounder, becoming the close confidante of a chief minister to a contender for the top spot in the government.