The Supreme Court on Tuesday ruled that two extension of tenure of one year each to incumbent ED Director Sanjay Kumar Mishra were illegal while upholding 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.

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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, 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 the respondent No.2- Sanjay Kumar Mishra for a period of one year each are held to be illegal”, the bench said order while permitting Mishra to continue to hold office till 31st July, 2023.

Pronouncing the judgment, Justice Gavai said, “Though we have held that orders dated 17th November 2021 and 17th November 2022 granting extensions to respondent No.2 ( Sanjay Kumar Mishra) are not valid in law, we are inclined to take into consideration the concern expressed by the Union of India with regard to FATF review. We are further inclined to take into consideration that the process of appointing the Director of Enforcement is likely to take some time. In that view of the matter, we find that in order to ensure the transition to be smooth in the larger public interest, it will be appropriate to permit respondent No.2 to continue to be in office till 31st of July 2023.”

Stating that the scope of the judicial review of an enactment was limited to three aspects – competence of the legislature enacting it, whether it infringes the fundamental rights and finally if it is arbitrary.

Referring to the procedure for the appointment and grant of extension to incumbent CBI/ED Director, the judgment said, “It is, thus, clear that it is not at the sweet-will of the Government that the extensions can be granted to the incumbents in the office of the Director of CBI/Director of Enforcement. It is only on the basis of the recommendations of the Committees which are constituted to recommend their appointment and that too when it is found in public interest and when the reasons are recorded in writing, such an extension can be granted by the Government.”

Having said that government cannot grant extension of tenure to Director CBI/ED impulsively or arbitrarily, the judgment said, “We are, therefore, unable to accept the arguments that the impugned Amendments grant arbitrary power to the Government to extend the tenure of the Director of ED/CBI and has the effect of wiping out the insulation of these offices from extraneous pressures.”

The top court judgment came on a batch of petitions challenging the Centre’s November 17, 2022 decision extending the third tenure to Director of Enforcement Directorate Sanjay Kumat Mishra.

Mishra was appointed as Director of Enforcement in the Directorate of Enforcement (ED) on November 19, 2018 for a term of two years. Prior to his appointment as Director of Enforcement, Mishra was Principal Special Director in the ED. On November 13, 2020, President of India approved the modification of the November 19, 2018 order extending the period of appointment of Mishra from two years to three years.

The central government had justified the extension of tenure, telling the top court that important investigations relating to trans-border crimes were at a crucial stage. The extension of tenure to Mishra, the top court was told, was in pursuant to the recommendation made of the high-powered committee.

Besides Jaya Thakur, other petitioners are Congress leader Randeep Singh Surjewala, Trinamul Congress leader Mahua Moitra and Saket Gokhale.