On July 27, the Supreme Court of India extended the term of Enforcement Directorate (ED) Director Sanjay Kumar Mishra till September 15 in “larger public interest.” The Government of India had moved the Supreme Court seeking an extension of the term for the ED Director, which was set to end on July 31.
The court’s three-judge bench, comprising Justices BR Gavai, Vikram Nath and Sanjay Karol, heard the matter and allowed the government’s request to extend SK Mishra’s term while stating that no further extensions would be allowed to him.
“We add that no further application would be entertained for grant of extension. We also direct that the respondent will cease to be the director of ED with effect of midnight of 15th/16th September 2023,” the court said.
The Government of India contended that the involvement of SK Mishra with the Financial Action Task Force (FATF) review of India’s anti-money laundering mechanism necessitates the extension of the outgoing ED Director’s term.
The Solicitor General Tushar Mehta submitted that the FATF peer review has been going on for the past five years. “It is not that anybody is indispensable. But the continuity will help the nation. The FATF review will determine the country’s credit rating and credit rating will determine whatever financial help the country can get from World Bank etc,” the Solicitor General submitted. He further informed the court that the FATF committee is coming for an on-site visit on November 3, 2023.
Background
On July 11, the Supreme Court of India held that the extension given to SK Mishra is illegal as it violates the court’s 2021 ruling in the Common Cause case, wherein the court held that he should not be given further extension. SK Mishra is an Indian Revenue Service (IRS) officer of the 1984 batch.
The court, however, allowed SK Mishra to continue as the ED Director till July 31, 2023, taking into consideration the Government of India’s concerns regarding a smooth transfer of power and the peer review of the intergovernmental organisation – FATF.
The court also upheld the amendments made to the Central Vigilance Commission Act and the Delhi Special Police Establishment Act, which allows the Government of India to extend the term of the heads of ED and Central Bureau of Investigation (CBI) up to 5 years. The court further noted that the scope of judicial review over the legislation is limited.
“It is, thus, clear that it is not at the sweet-will of the Government that the extensions can be granted to the incumbents in the office of the Director of CBI/Director of Enforcement. It is only on the basis of the recommendations of the Committees which are constituted to recommend their appointment and that too when it is found in public interest and when the reasons are recorded in writing, such an extension can be granted by the Government,” the court said in its 103-page judgement.
The court’s three-judge bench, comprising Justices BR Gavai, Vikram Nath and Sanjay Karol, was hearing the petitions challenging the extension granted to ED director Sanjay Kumar Mishra and the 2021 amendments. The petitioners include Congress leaders Randeep Singh Surjewala, Jaya Thakur, and Trinamool Congress (TMC) MP Mahua Moitra, among others.
The petitioners’ counsel argued that the impugned amendments allow the government to grant extensions of one year at a time, thus, enabling the government to apply a ‘carrot and stick’ policy. Therefore, the directors of ED and CBI would have to act as per the government’s desire to secure such an extension of their tenure.
The counsel argued that the very purpose of insulating these agencies from extraneous governmental pressure would be wiped out due to these amendments. The counsel contended that if the impugned amendments are permitted to exist, then they would frustrate the purpose of insulating the aforesaid high posts from extraneous pressures.
The court noted that the Government of India appoints ED’s director on recommendations of a Committee consisting of the Central Vigilance Commissioner, Vigilance Commissioners and certain high-ranking officials from the Government of India. The court further noted the safeguards in place to ensure strong protection of the Central Vigilance Commissioner and the Vigilance Commissioners under the CVC Act, thus, insulating them from extraneous pressures.
“As already observed herein above, there is safeguard in the statute which insulate the office of the Central Vigilance Commissioner and the Vigilance Commissioner from extraneous pressures and permits them to act independently,” the court said.
The court further noted the procedure for the appointment of the CBI director. The court noted that a director to CBI is appointed based on recommendations of a Committee consisting of the Prime Minister, the Leader of the Opposition and the Chief Justice of India. “Therefore, the appointment of the Director of CBI cannot be made unless it is recommended by the High-Level Committee consisting of the Prime Minister; the Leader of Opposition; and the Chief Justice of India or Judge of the Supreme Court nominated by him/her,” the court said.
The court noted that the impugned amendments allow the government to extend the term for the directors of ED and CBI based, in the public interest, one year at a time, based on the recommendation of the respective committees constituted for their appointments, with reasons recorded into writing. The court said that it is not “at the sweet-will” of the government, that the extensions are granted to the incumbent directors of ED or CBI.
“When a committee can be trusted with regard to recommending their initial appointment, we see no reason as to why such committees cannot be trusted to consider as to whether the extension is required to be given in public interest or not,” the court said.
“We are, therefore, unable to accept the arguments that the impugned Amendments grant arbitrary power to the Government to extend the tenure of the Director of ED/CBI and has the effect of wiping out the insulation of these offices from extraneous pressures,” the court added.
While the court upheld the impugned amendments, it held that the extension given to ED director SK Mishra is illegal as it contravenes the Supreme Court’s 2021 judgement in the Common Cause case. The court, however, allowed SK Mishra to continue as the ED Director till July 31, 2023, taking into consideration the Government of India’s concerns regarding a smooth transfer of power and the peer review of the intergovernmental organisation – FATF.
“Although the basis of a judgment can be taken away, the legislature cannot annul the specific mandamus that barred further extension…That would amount to sitting in appeal over judicial act,” Justice Gavai said while pronouncing the judgement. The court held that the orders dated November 17, 2021, and November 17, 2022, extending SK Mishra’s term by one year each were held to be illegal.
