With just five days left for the Director, Directorate of Enforcement Directorate (ED) Sanjay Kumar Mishra to demit office, the Centre on Wednesday approached the Supreme Court seeking permission to extend his tenure till October 15, in view of the ongoing Financial Action Task Force (FATF) review which is at a critical stage.
The Centre’s application comes in the wake of the top court’s July 11 judgment ruling that two extensions of tenure of one year each to Sanjay Kumar Mishra were illegal. However, despite holding that two extensions of tenure to Sanjay Mishra were illegal, the top court had permitted him to continue as ED Director till July 31, in view of the ongoing FATF review.
Justice B.R. Gavai heading the bench, also comprising Justice Vikram Nath and Justice Sanjay Karol, had pronounced the judgment on July 11, 2023.
Mishra had earlier received a deadline, that was invalidated by the apex court.
Today Justice Gavai heading a bench also comprising Justice Hima Kohli and Justice Prashant Kumar Mishra, agreed to take up the Centre’s application for hearing on Thursday (July 27) after Solicitor General Tushar Mehta mentioned it for an early listing.
The Centre in its application seeking permission to extend the tenure of Sanjay Kumar Mishra beyond July 31, upto October 15 has said that FATF review which is at a critical stage where submissions on effectiveness have been made on July 21 2023 and an on-site visit is scheduled to be conducted in November 2023.
“At such a critical juncture, it is essential to have an individual who is well-acquainted with the overall status of money laundering investigations and proceedings across the country and also the intricacies of the procedures, operations and activities of the investigating agency, at the helm of affairs at the Directorate of Enforcement. This is necessary to ensure that the assessment team can be promptly and ably assisted with necessary reports, information, statistics etc,” the Centre has said in its application seeking top court nod for giving two-and-a-half-month extension (August, September and 15 days of October) to Sanjay Mishra.
The Centre in its application has said that any transition in leadership at the Directorate of Enforcement at this stage, would significantly impair the ability of the agency to provide necessary assistance to and co-operation with the assessment team and thereby adversely impact India’s national interest.
The Centre has told the top court that the FATF is an inter-governmental body which has developed its recommendations to prevent and combat money laundering and terror financing. About 200 countries including India, have committed to implement these standards.
FATF conducts peer reviews of all its member countries on a regular basis to assess levels of implementation of its recommendations. These peer reviews or mutual evaluation assess technical compliance with FATF recommendations and reviews the level of effectiveness of a country’s Anti-Money Laundering/Countering the Financing of Terrorism (AML/CFT) system.
The Centre has told the top court that India is currently being assessed in the fourth round of mutual evaluations. The mutual evaluation of the country was postponed to 2023 due to the Covid pandemic, says the application.
The Indian Mutual Evaluation has already commenced and the written submissions too have been made on July 21 2023. The centre has said that next two to three months the assessors will be seeking clarifications and leadership at a very senior level is required to respond to their queries.
The Centre has said that the assessors are likely to visit India for a period of three weeks starting November 3 2023. The onsite assessment involves detailed meetings with officers investigating and prosecuting money laundering offences, officers of FIU, regulators and reporting entities and would require a high level of coordination at senior levels. Several presentations on technical topics would also be required to be made.
The government said that the intricacies of complex money laundering investigations may also need to be explained to them, which can be done only by a person with hands-on experience.
“Since Enforcement Directorate is the only money laundering agency in India, its role in the presentation of effectiveness of anti-money laundering provision and administration before the assessor is very significant and important from a national interest perspective,” the centre has said.
While ruling that two extension of tenure of one year each to incumbent ED Director Sanjay Kumar Mishra were illegal, the top court on July 11 had, however, upheld amendment to the Central Vigilance Commission (Amendment) Act, 2021 and the Delhi Special Police Establishment (Amendment) Act, 2021 paving way for a five-year term for the CBI/ED Director – initial term of two years and three extensions of one year each.
The top court also upheld the amendment to the Fundamental Rules, 2021.
While ruling as illegal two extensions of tenure of one year each to Mishra, a bench of Justice B.R. Gavai, Justice Vikram Nath and Justice Sanjay Karol, had, however, permitted him to continue as ED Director till July 31.
“The impugned orders dated 17th November 2021 and 17th November 2022 granting extensions to the tenure of Sanjay Kumar Mishra for a period of one year each are held to be illegal”, the bench had said while permitting Mishra to continue to hold office till 31st July, 2023.