Supreme Court Dismisses West Bengal's Challenge To CBI Probe In Municipality Recruitment Scam; Says It's Linked To Teacher Recruitment Scam

The Supreme Court on Monday dismissed a plea filed by the State of West Bengal challenging the Calcutta High Court order transferring the probe in West Bengal Municipality Recruitment Scam to the Central Bureau of Investigation (CBI). The bench comprising CJI DY Chandrachud, Justice JB Pardiwala, and Justice Manoj Misra remarked prima facie that that the municipality recruitment scam appeared to be linked to the teachers recruitment scam(which is under the investigation of the CBI & ED). 

Senior Advocate Kapil Sibal, appearing for the State of West Bengal argued that the High Court had erred in its decision of transferring the matter to the CBI as there was no material to prove that the State could not investigate the scam. He further argued that the Enforcement Directorate (ED) had no jurisdiction in the matter and the body was just "targeting" officers at this point. He said–

"Which other States is this happening in? There is no jurisdiction of ED here. They are here for money laundering, they are calling officers and saying that statements under Section 50 PMLA will be recorded. It is now becoming a roving enquiry...How does the ED come into all of this?"

Additional Solicitor General of India SV Raju, appearing for the ED, argued that there seemed to be a "larger conspiracy" at play in the matter and that it seemed that the two scams- 'Municipality Recruitment Scam' and the ‘Teachers Appointment Scam’ were inter-related. He said–

"It is not a separate offence as it sought to be depicted. One company was appointed to print OMR sheets for 2 exams. This is all interrelated."

The ASG further said that during the investigation of the teachers recruitment scam, ED came across information regarding the municipality recruitment scam. As per Section 66(2) of the PMLA, ED is bound to disclose information regarding other offences. Therefore, an application was filed before the Calcutta High Court.  The ASG further informed that following the High Court order, CBI has regsitered an FIR and has commenced investigation. For context, as per Section 66(2) the ED can furnish information to officers of the Central Government, if in its opinion it is necessary so to do in the public interest. The ASG added that witnesses in both the scams had revealed "common links" between the matters. 

At this juncture, the CJI remarked that the CBI investigation had attained finality in the Teacher's Recruitment Scam and even the witness statements had been examined. Sibal interjected to the same stating that the High Court had passed the order in the absence of relevant material and had solely relied upon the status report for the purpose of the order. He added that the State machinery could not be bypassed. To this, the CJI remarked–

"The judgment of the single judge in which status report was filed– he relies on that. So how can we say there was absence of material before the HC...It is clear that the municipal recruitment and teachers recruitment scam are linked since the same person had prepared the OMR sheets...This is the status report on which the single judge has relied."

Sibal reiterated this point and stated that if the bypassing of state machinery was permitted, it would set a wrong precedent for other States as well. He said–

"What about the state's power? Please see the Sampath Lal judgment...This is bypassing the state machinery. If this is allowed then it can happen in every state."

The CJI remarked that the situation would have been different had the Municipality Scam been unrelated to the Teachers' Recruitment scam. However, since the court was satisfied that the Teachers recruitment scam and the Municipal Recruitment Scam were both linked to each other, the matter was dismissed.

Background

A single judge bench of Calcutta High Court comprising Justice Abhijit Gangopadhyay on April 21, 2023 passed an order which permitted the CBI to carry on investigation in the 'Municipality Recruitment Scam'. The order was passed on the basis of an application filed by Enforcement Directorate (ED). The ED had claimed that while investigating the ‘Teachers Appointment Scam’ (for the aspect for which ED was engaged) it came across the ‘Municipality Recruitment Scam’ in the state. As per the ED, the two scams were intermingled on account of common agents and common beneficiaries and that the victim in both the cases was the same i.e. “public/common people at large”.