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'ED Director Can Be Appointed For A Period Of More Than 2 Years' :Supreme Court Upholds Extension Of ED Director SK Mishra's Tenure

LIVELAW NEWS NETWORK
8 Sep 2021 5:14 AM GMT
ED Director Can Be Appointed For A Period Of More Than 2 Years :Supreme Court Upholds Extension Of ED Director SK Mishras Tenure
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The Supreme Court on Wednesday refused to interfere with the extension of tenure given to the Director of Enforcement Directorate Sanjay Kumar Mishra. The Court refused to interfere with the order passed by the Union Government on November 13, 2020 which retrospectively amended the appointment order of the present ED Director to give him one more year in office. He had attained the age...

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The Supreme Court on Wednesday refused to interfere with the extension of tenure given to the Director of Enforcement Directorate Sanjay Kumar Mishra.

The Court refused to interfere with the order passed by the Union Government on November 13, 2020 which retrospectively amended the appointment order of the present ED Director to give him one more year in office. He had attained the age of superannuation in May 2020.

Delivering judgment in the case Common Cause(A Registered Society) v. Union of India and others, a bench of Justices LN Rao and BR Gavai upheld the power of the Union of India to extend the tenure of ED Director beyond two years in "rare and exceptional circumstances". Such extension can be given to facilitate the ongoing investigation. The bench said that any extension of tenure during superannuation has to be for a short period and be granted for reasons recorded.  The Court also added that the term of SK Mishra should not be extended any further. With the above observations, the Court dismissed the PIL filed by the NGO Common Cause.

"We've upheld the power of the Union of India to extend the tenure beyond two 2 years. However we hold that such power has to be extended only in rare circumstances. It can be given to facilitate ongoing investigation. Any extension of tenure during superannuation should be for a short period", Justice Rao read out the operative portion of the judgment.

Since Mishra's appointment is coming to an end in November 2021, no further extension be granted to him, the bench added.

"The decision to extend the tenure of the second Respondent(Mishra) is pursuant to the recommendation made by the high-powered committee. Though we have upheld the power of the Union of India to extend the tenure of Director of Enforcement beyond the period of two years, we should make it clear that extension of tenure granted to officers who have attained the age of superannuation should be done only in rare and exceptional cases. Reasonable period of  extension can be granted to facilitate the completion of ongoing investigations only after reasons are recorded by the Committee constituted under Section 25 (a) of the CVC Act. Any extension of tenure granted to persons holding the post of Director of Enforcement after attaining the age of superannuation should be for a short period", the operative portion of the judgment read.

Background

Mishra was appointed as the Director of ED as per order dated November 19, 2018, and his mandatory two years tenure prescribed under the CVC Act came to an end on November 18, last year. His tenure had however been extended for one more year by the impugned Office Order dated November 13, whereby the 2018 amendment Order for appointment had been amended such that the period of 'two years' written in that order has been modified to a period of 'three years'. Thus, in effect, Mishra had been given an additional one year of service as Director, Enforcement Directorate.
This extension was challenged by the NGO Common Cause by filing a writ petition through Advocate Prashant Bhushan in the Supreme Court. A bench of Justices LN Rao and BR Gavai had reserved judgment on August 18, 2021 in the petition filed by Common Cause, which had also sought a direction to the Central Government to appoint a Director to the Enforcement Directorate (ED) in a fair and transparent manner.

Senior Advocate Dushyant Dave had appeared for the petitioner and Solicitor General Tushar Mehta had appeared for Union Government.

The main arguments raised by the petitioner were :

After the end of Mishra's two-year tenure as the ED Director, he would have been ineligible for appointment to the said post again by virtue of Section 25 of the CVC Act.

"ED Director must be appointed strictly in accordance with the mandate of Section 25 of the Central Vigilance Commission Act, 2003," petition had stated.

The NGO had also averred that there was neither any enabling provision in the CVC Act for extension of service of the Director, Enforcement Directorate nor any enabling provision which provides for such retrospective modification of appointment orders.

It was argued that the Government had employed a circuitous route in order to ensure that Mishra got one more year as the ED Director. In this context, the petition had submitted that the intention behind Section 25 (d) was to provide a minimum tenure of two years to the ED only to insulate the Director of Enforcement from all kinds of influences and pressures.

"However, the said purpose got defeated if on the verge of his two-year tenure and much after his retirement age, the Director of Enforcement was given a de facto extension in service by adoption of a circuitous route of modifying the initial appointment order itself," petition further stated.

Senior Advocate Dushyant Dave argued that the provisions did not contemplate giving an extension to the ED Director who has already superannuated.

"It was very wrong for the government to extend the tenure of the officer who had already superannuated. Right to be considered for promotion is a fundamental right. It is a constitutional right. The Government cannot exercise its power in a manner which will hurt so many people. We have come here under public law. The appointment should be constitutionally & legally proper.

Parliament did not want these officers to continue beyond a period of 60 years", he had submitted.

Dave argued that the retrospective extension made a "mockery" of the judgments of the Supreme Court in cases like Vineet Narain and Prakash Singh cases. He also relied on Rule 56 of the Fundamental Rule to contend that a retired government servant cannot be given an extension after he has attained the age of superannuation.

Arguments of the Central Government

The Solicitor General of India Tushar Mehta first questioned the locus standi of the petitioner NGO to challenge the government order. He submitted that PILs cannot be entertained in service disputes.

He also argued that there were NGOs who are trying to "run a parallel government" by filing "frivolous PILs". There are some organizations whose only purpose is to file PILs, the SG added.

At this point, the bench had asked if PILs are not important to raise the voices of the people.

"Don't you think PILs are important to raise the voice of the people in a democracy", Justice Rao asked the Solicitor General. " Prashant Bhushan and Dushyant Dave would have many matters where public interest has been served", Justice Rao commented.

On the merits of the matter, the SG argued that there was no statutory bar against extending the tenure of the ED Director.  He pointed out that Section 25(d) of the Central Vigilance Commission Act says that "a Director of Enforcement shall continue to hold office for a period of not less than two years from the date on which he assumes office".

Interpreting this provision as not imposing any upper limit on the term, the top law officer of the Union Government argued the statutory prescription for a "period not less than 2 years" does not mean that the term cannot be more than 2 years.

"A Minimum tenure of 2 years ensure that the incumbent plans and is not subject to any pressure. The legislature never intended to provide a "statutory cap" or a "static tenure". There is a conscious use of the expression, not less than 2 years", he submitted.
The SG further submitted that the continuity of the term was necessary to ensure the completion of pending investigation in many high profile cases, and hence the extension order was in public interest.

The extension of tenure of the was on the basis of a recommendation made by the Committee headed by the Chief Vigilance  Commissioner on 11.11.2020 in view of administrative exigencies. The SG relied on the general power under Section 21 of the General Clauses Act 1897 to argue that the Central Government has the power to extend the tenure, though the CVC Act does not expressly grant such power.

Reasoning of the Court

In the judgment, the Court said that it was not considering the preliminary objections raised by the Solicitor General as it was inclined to consider the matter on merits.

With respect to Dave's arguments based on Rule 56 of Fundamental Rules, the Court said that the non-obstante clause in Section 25 of the CVC Act overrides the said provision.

The minimum period of two years which is provided in Section 25 would operate notwithstanding the provisions contained in Fundamental Rule 56(a).

The words "not less than 2 years" in Section 25 (d) of CVC Act means a minimum tenure of 2 years.

"There is no scope for reading the words to mean not more than two years. Reading such a restriction would be contrary to the recommendations of the Independent Review Committee and the judgment of this Court in Vineet Narain. Curtailment of the tenure of a Director Enforcement would be detrimental to the interests of officers who are appointed to the post and have service of more than two years before they attain the age of superannuation. Therefore, we hold that a Director of Enforcement can be appointed for a period of more than two years by following the procedure prescribed under Section 25 of the CVC Act", the judgment authored by Justice Rao stated.

SK Mishra was eligible for extension

The Court also held that the date of superannuation of SK Mishra in May 2020 will not affect the power of the Union Government to extend his tenure.

"We have already held that the initial appointment of the second Respondent(Mishra) cannot be termed to be illegal and that he had a right to continue till 18.11.2020 by virtue of his appointment for a period of two years. For all practical purposes, he should be treated as the Director of Enforcement till that particular date he was holding an office which is not below the rank of an Additional Secretary to the Government of India. Therefore, he was eligible for extension of tenure", the Court said.

No statutory bar against appointing ED Director for more than 2 yeas

As the tenure of appointment of Director of  Enforcement is not a maximum period of two years, a person can be appointed as Director of Enforcement for a period of more than two years.  There is no proscription on the Government to appoint a Director of  Enforcement beyond a period of two years.

Case Details

Title : Common Cause (A Registered Society) v. Union of India and others

Citation : LL 2021 SC 429

Click here to read/download the judgment

Also Read: There's No Statutory Cap For ED Director's Term, Argues Solicitor General; Supreme Court Reserves Judgment
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