SCO Daily: Validity of tenure extension of CBI and ED Directors

Welcome to SCO Daily. I’m Gauri Kashyap and today we’ll be discussing the validity of tenure extensions for CBI and ED Directors. 

On May 8th 2023, the Supreme Court reserved Judgment on the validity of tenure extensions for CBI and ED Directors. At its core, this case concerns the independence of the Central Bureau of Investigation and the Enforcement Directorate. In this video, we explain the background of the case and the arguments presented before the Court. 

In November 2018 Mr. Sanjay Kumar Mishra, was appointed as the Director of the ED for a fixed period of two years. Before he could retire in November 2020, the Union extended his tenure by a year. Common Cause, a registered society, challenged the extension on the ground that it violated Section 25 of the Central Vigilance Commission Act, or the CVC Act. Section 25 specifically stated that the director’s tenureis to be for two years. 

While this case was pending, the Union Government issued the Delhi Special Police Establishment, and CVC Ordinances in 2021. These Ordinances allowed the Union to grant extension of tenures for the CBI and ED directors one year at a time, up to a maximum of 5 years. Soon after, Mr. S.K. Mishra’s tenure was extended by another year bringing his tenure to 4 years in total. 

Common Cause argued that the Director of an investigative body such as the CBI or ED is given a 2 year tenure to ensure that they are protected from external political pressures. They also cited Fundamental Rule 56 which states that tenures of Government employees cannot exceed the age of retirement at 60 years. 

While deciding this case in 2021, the Court held that the CVC Act only laid down a minimum tenure of 2 years. Tenures could be extended if the Director reached retirement age before the two year tenure completed. That is, if a Director was due to retire in say January, and their 2 year period ended in April, they could serve a full 2-year tenure. On Mr. Mishra’s tenure, they refused to interfere, as he was due to retire about 1-2 months from the day the judgement. However, they clearly stated that he was no longer eligible for any further extensions. Extensions to CBI or ED Directors were to be given only in ‘rare and exceptional cases’. 

Three months after the Common Cause Judgment, Parliament enacted the Central Vigilance Commission (Amendment) Act and the Delhi Special Police Establishment (Amendment) Act which confirmed the two Ordinances. Despite the express bar on further tenure extensions for Mr. Mishra, the Union gave him a third extension, bringing his tenure to 5 years. 

The next day, Ms. Mahua Moitra and Mr. Randeep Singh Surjewala filed petitions at the SC challenging the Acts. They argued that the Ordinances and the Acts that followed, were contrary to the Court’s decision in Common Cause. It is in this case that the Court has recently completed hearings, and reserved Judgement. 

During the 4 days of hearings, the Petitioners and the Union government clashed on three main points. 

First, the Petitioners argued that in Common Cause, the SC held that tenure extensions for Directors of autonomous bodies must be under ‘rare and exceptional’ circumstances, and for a ‘short period’ of time. Mr. Mishra’s extension did not fit into either category. The Union claims that Mr. Mishra’s tenure was extended for the specific reason of leading the ED through a mutual assessment conducted by the Financial Action Task Force. The FATF is an international body that assesses a Country’s measures to combat money laundering and the financing of terrorism. India is currently under the 4th round of evaluation by FATF, which has been pending since 2019 due to the COVID-19 Pandemic.

As per the tentative timeline, the crux of the assessment will be completed in November 2023, the same time Mr. Misra will retire. The Union argued that as this assessment is important for India, it was crucial that Mr. Mishra remains the Director for the sake of continuity and expertise. Justice Gavai seemed amused, and asked the Union if there was simply no one else in the entire enforcement directorate who was competent. The Union responded that no person was irreplaceable. However, for this evaluation Mr. Mishra was. 

Second, petitioners highlighted the specific bar on tenure extensions for Mr. Mishra imposed in Common Cause. The Union cannot simply pass new laws undo the decision of the SC they said. The Union responded that the legislature was within its powers to amend the CVC and DSPE Acts. Further, when the Common Cause judgement was delivered, a specific law allowing tenure extensions did not exist. As the Acts changed the context of Mr. Mishra’s tenure extension, the binding nature of Common cause did not apply to the present case—it simply was a different set of facts altogether. 

Third, petitioners claim that the extensions cause an alarming threat to the independence of investigative bodies. The Union can now dangle the incentive of tenure extension for Union-friendly behaviour from directors. The independence of these autonomous investigative bodies, which are often watchdogs for the government itself, will be grossly compromised. The Union however asserted that the Central Vigilance Commission, which chairs the committee that appoints CBI and ED directors, is ‘impeccably independent’. It is up to the CVC to decide whether such extension will be granted, and the CVC does not act per the whims of the Union. 

Considering that the CBI and the ED investigate corruption in the government and money laundering, it is crucial that these investigative institutions are kept safe from political interference. Many argue that the wide powers of the ED, combined with a leader arguably in the good-books of the government, is a threat to democracy. Incidentally, while the case remained in Court, the ED under Sanjay Kumar Mishra’s stewardship arrested several leaders from Opposition parties. The Supreme Court has reserved Judgement in this case.

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