Shreya took an advance from producer Murugesan to star opposite Dhanush, son-in-law of Rajnikant. She was supposed to start working on the film after finishing a shooting schedule for Gemini Films with the same actor, sources from the Tamil Film Producers Council (TFPC) said.
"The action is being taken after Murugesan's complaint, endorsed by his director Vetrimaran. Its terms have been communicated to Shreya," the source added.
Shreya has denied the charges.
According to sources close to Shreya, she deposited the undisclosed fee for the untitled Murugesan film with the South Indian Artistes Association (SIAA) pointing out she is busy with Hollywood commitments - "The Other End Of The Line" produced by Metro-Goldwyn-Mayer (MGM) and the post-production schedule of "What's Cooking Stella?" being directed by Canada-based director Deepa Mehta and her brother Dilip.
Shreya is reportedly stumped over the whisper campaign against her in the south Indian film industry.
Shreya hit the bull's eye when she was cast opposite Tamil superstar Rajnikant in "Sivaji, The Boss" (2006). The film directed by Shankar broke all box office records.
Shreya's current Indian assignments include "Kandaswamy", K.S. Ravi Kumar's "Jaggubhai" and "Marmayogi" opposite Vikram and it also stars actor-turned-politician Sarath Kumar and thespian Kamal Haasan.
"All her major Tamil projects will get into trouble if TFPC takes action against her," an industry source added.
Shreya has 37 films under her belt. Of those 31 are in south Indian languages.
She has also tried her luck in Hindi films with "Thoda Thum Badlo Thoda Hum", "Aawarapan," "Mission Istaanbul" and "Ek, The Power of One". But all the films flopped.