The Supreme Court of India has granted an extension to Sanjay Kumar Mishra, the Director of the Enforcement Directorate (ED), allowing him to continue in his position until September 15. This extension was specifically given for the ongoing Financial Action Task Force (FATF) review exercise, and it was justified as being in the national interest. Notably, the court has made it clear that this will be the final extension and that Mishra will have to step down from his role after September 15, without any further prolongation.

Prior to this decision, the Supreme Court had set a deadline of July 31 for the conclusion of Mishra’s tenure as ED director. However, the government had sought an extension, and during the court hearing, the judges expressed their concern by questioning whether the ED department lacked competent individuals apart from the incumbent chief. They raised doubts about the need for continuous reliance on a single individual and whether the entire department could be perceived as incompetent.

The Solicitor General, representing the government, argued that while Mishra’s presence might not be indispensable, it is crucial for the ongoing FATF peer review exercise. The FATF peer review process is significant for India, and Mishra’s knowledge and experience were considered important for the effective handling of this exercise.

The Central government had filed a plea to the Supreme Court requesting the extension until October 15. They explained that the FATF review process was at a critical juncture, with submissions on effectiveness already made in July 2023, and an on-site visit scheduled for November 2023. They emphasized the need for an individual who is well-acquainted with the various money laundering investigations and proceedings across the country and is familiar with the agency’s procedures, operations, and activities to be at the helm of the ED during this crucial period.

The government stated that a transition in leadership at this stage could significantly hamper the agency’s ability to provide the necessary assistance and cooperation to the FATF assessment team, which could adversely impact India’s national interest.

Amendment to CVC Act for ED Director Tenure Extensions: Supreme Court

It is worth noting that this is not the first time Mishra’s tenure has faced legal challenges. After being appointed as the ED Director for a two-year term in November 2018, his tenure came to an end in November 2020. However, on November 13, 2020, the Central government modified the order to extend his term to three years. This modification was challenged before the Supreme Court by the NGO Common Cause.

In a September 2021 verdict, the court upheld the modification but ruled against granting further extensions to Mishra. Subsequently, the Central government passed a law through an ordinance that amended the Central Vigilance Commission (CVC) Act, granting the government the power to extend the tenure of the ED director by up to five years, subject to a maximum of one year at a time. This law was later passed by Parliament.

In conclusion, while the Supreme Court has allowed Sanjay Kumar Mishra to continue as ED director until September 15 for the FATF review exercise, this extension will be the final one granted, and he will have to step down from his position thereafter.

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