• The Supreme Court said that the third extension to Sanjay Kumar Mishra''s tenure as the Enforcement Directorate (ED) chief was illegal and in violation of its judgment in 2021.
• The top court, however, permitted him to continue in office until July 31 to allow for a smooth transfer.
• It is unfortunate that the Supreme Court has allowed S K Mishra, Director of the Enforcement Directorate (ED), to continue in office till September 15 after it had ruled on July 11 that he could continue only till July 31. The court said he could continue till September 15 after the central government sought his continuation till October 15, claiming that his services are indispensable during the ongoing country review before the Financial Action Task Force (FATF). The court had earlier found that the extensions given to Mishra in 2021 and 2022 were illegal and had rejected the government’s argument that his services were indispensable for the FATF review. The government approached the court again with the same argument and the court has now accepted it partially.

Enforcement Directorate (ED)

• The Enforcement Directorate was established in the year 1956 as an ‘Enforcement Unit’ under the Department of Economic Affairs.
• Later, in 1957, this Unit was renamed as ‘Enforcement Directorate’.
• Administrative control
• Presently, it is under the administrative control of the Department of Revenue (under the Ministry of Finance) for operational purposes.
• Functions
• ED is responsible for enforcement of the Foreign Exchange Management Act, 1999 (FEMA), and certain provisions under the PMLA.
• ED has the power to attach the asset of the culprits found guilty of the violation of FEMA.
• It has also been empowered to undertake, search, seizure, arrest, and survey, etc. against the offences committed under PMLA.
• Appointment of Director of ED
• The ED Director is appointed by the central government on the recommendation of a committee:
• chaired by the Central Vigilance Commissioner and
• members comprising of Vigilance Commissioners, Home Secretary, Secretary DOPT and Revenue Secretary.

• The Supreme Court held that the third extension of service to Sanjay Kumar Mishra, the Director of the Enforcement Directorate (ED), was invalid.

Background

• Extension of tenure
• Mishra was first appointed as the ED Director in November 2018, for a fixed period of two years.
• Days before his tenure was to end, the President in November2020, modified the previous order retrospectively and changed Mishra’s tenure to three years.
• Issue challenged in SC
• In 2020, when Mishra was granted a one-year extension, it was challenged in the top court by an NGO, Common Cause.
• In September 2021 judgment, the court allowed the extension given his tenure was coming to an end in about two months.
• However, the apex court was clear that no further extension was to be granted to Mishra.
• Amendments to the CVC Act and the DSPE Act
• In December 2021, the Parliament passed two bills to replace the ordinances promulgated in November 2021 to enable extension of tenure of the directors of the Central Bureau of Investigation (CBI) and Enforcement Directorate (ED).
• The two bills, brought in this regard, were:
• The Central Vigilance Commission (Amendment) Bill, 2021, and
• Delhi Special Police Establishment (Amendment) Bill, 2021.
• The amended law allowed the extension of service of ED and CBI chiefs for a period of three years beyond their two-year tenure by granting extensions of one-year each.
• Such extensions were allowed to be granted in public interest.
• Re-extension of tenure
• Under the amended law, Mishra got an extension from November 2021 to November 2022.
• Last November, his tenure was further extended by a notification till November 2023.
• This was the third extension in the tenure of Mishra, who was to be in office till November 18, 2023, with a total tenure as ED chief lasting five years.
• Issue again challenged in the court
• The extension of Mishra was challenged by a bundle of petitions, which banked on the September 2021 order of the top court.
• The changes to the CVC and DSPE Act were also challenged before the Supreme Court.
• The petitioners contended that it would defeat the directive issued by SC in 1997 in Vineet Narain and Others v. Union of India to have a fixed tenure of the CBI chief.
• SC in the Vineet Narain vs Union of India (1997) case was of the opinion that the CBI and the ED chiefs should have a minimum tenure of two years.

• On amendments made to the CVC Act, DSPE Act
• The apex court upheld as constitutional the amendments made to the Central Vigilance Commission Act, 2003, The Delhi Special Police Establishment Act, 1946, and the Fundamental Rules in 2021, enabling the tenure extension.
• The apex court said that the legislative enactment can be struck down only on two grounds:
• the appropriate legislature does not have the competence to make the law; and
• it takes away or abridges any of the Fundamental Rights enumerated in Part III of the Constitution or any other constitutional provisions.