‘Climate of fear’ warning by SC: Time to curb ED powers

That it took the highest court of the land to upbraid the Enforcement Directorate (ED) which, with powers it considers unbridled, has been “running amok” in Chhattisgarh and other states, asking it not to create an “atmosphere of fear”, points to exactly how the federal institution has been proceeding with its investigations in places ruled by political parties opposed to the one that runs the Centre. The court cautioning the agency that even a bona fide cause becomes suspect “when you behave like this” reflects the fact that its behaviour has been less than professional, an opinion people in several states would instantly assent to.

The Chhattisgarh government was forced to invoke Article 131 of the Constitution, which empowers a state to move the Supreme Court directly in matters of dispute with the Union government or any other state, and challenge the constitutional validity of some of the provisions of the Prevention of Money Laundering Act (PMLA), 2002. The Congress-led state government had also alleged that Central investigating bodies working at the behest of the Union government are disturbing its normal functioning. The government told the Supreme Court that the ED, investigating a 2,000-crorerupee liquor scam, has been torturing its officers and even their family members. The officers have made written complaints of being threatened to sign blank pages or pre-typed documents.

This is not the first case where the agency has run afoul of the judiciary. In August 2022, it issued summons to former Kerala finance minister Thomas Isaac alleging breach of the law in the issue of “masala bonds” by KIIFB, the state’s infrastructure funding agency. The summons came amid complaints of harassment of KIIFB officials at the hands of ED. It has been several months since the high court, after staying summons, asked the agency to explain the logic of the summons to Mr Isaac. No clarification has come yet. In the meantime, the RBI has told the court that the issuance of bonds had met all the legal parameters.

The mortal fear of people who cross the agency’s path is that the PMLA makes it nearly impossible to get bail: Section 45(1)(ii) of the law says the court can grant bail only when it is satisfied that there are reasonable grounds for believing that the accused is not guilty of the offence and that he is not likely to commit any offence while on bail, conditions which make even a liberal judge think twice before turning to the dictum “bail is the rule”.

It is true that the Supreme Court had last year upheld the constitutionality of the law terming it a “unique and special legislation”. It indeed is a special law as it accords protection to the procedures of the officers of the agency that is available to civil courts and leaves the burden of proof on the accused.

It’s time the legislature and the judiciary took a critical view of the law and the agency which enforces it. It must be made sure that both serve their intended purposes.

In 2022, ED issued summons to former Kerala finance minister Thomas Isaac alleging breach of the law in the issue of ‘masala bonds’ by KIIFB but RBI said it met parameters