ED Under Scanner: Central Agency Rapped By SC For Poor Probe Even As It Makes Second High-Profile Arrest In Delhi Excise Policy Case

The Supreme Court on Thursday rapped the Enforcement Directorate (ED) for the lack of evidence presented so far against Aam Aadmi Party (AAP) leader Manish Sisodia in the Delhi Excise Policy case. The SC's remarks came barely a day after the ED arrested AAP MP Sanjay Singh in the case. 

Sisodia along with several others is an accused in the Delhi Excise Policy case. The agencies have alleged that there were irregularities in the formulation and implementation of the Delhi Excise Policy 2021-22 and that bribes were exchanged. The Central Bureau of Investigation (CBI) is pursuing the criminal angle in the case and the ED is following the money trail.  

Twelve days after the CBI arrested Sisodia, who held the excise portfolio in Arvind Kejriwal's Delhi Cabinet at the time of the alleged scam, the ED also arrested Sisodia on March 9. Singh is the latest person to be implicated in the Delhi Excise Policy case. 

The ED has alleged that Rs 2 crore of illegal cash exchanged hands at the official residence of Singh, who was arrested on Wednesday after daylong questioning. The agency has further claimed that Sisodia assured changes in the policy through Sisodia to favour certain businesses.

"The investigation has revealed that Singh had assured to get changes through Manish Sisodia in the then proposed Excise Policy of 2020-21 to increase the brand registration criterion for IMFL brands at the behest of Amit Arora and Dinesh Arora. In exchange for this, an associate/team member of Singh i.e. Vivek Tyagi was given stakes in the business concern of Amit Arora i.e. Aralias Hospitality Pvt Ltd," said the ED in court, as per PTI. 

The SC's indictment of the ED therefore coincides with the arrest of Singh, which has already been condemned by the Opposition. The SC's rap on the wrists of ED has again brought to light the agency's poor record. An analysis by The Indian Express showed that of the 2,400 money laundering cases the ED took up during 2005-19, only eight resulted in convictions. The dismal conviction record even with extraordinary powers leads to the question of whether the ED and other federal investigative agencies are pursuing these cases on the basis of evidence or, as the Opposition parties allege, they are acting at the behest of the ruling party. The arrest of Singh when the case of Sisodia is yet to progress adds to the allegations against the ED. 

Noting that the ED's charge against Sisodia taking a bribe is based on an accused turning approver, the SC said, "Isn’t the statement (by an approver) hearsay? It is an inference but has to be based on evidence. In cross examination this will fall flat in two minutes...How do you establish kickbacks were given? Is it entirely on the basis of approvers’ statements?"

In 2013, the Supreme Court infamously termed the CBI the "caged parrot" that mirrored the tone of the ruling party at the Centre. The place of the CBI and the Income Tax (IT) Department has now been taken up by the ED as it is pursuing cases against a host of Opposition leaders. The extraordinary powers of the ED related to the attachment of properties and recording of statements ensure that the accused have little way to escape its net even if they are not convicted. As they say, the procedure is the punishment. 

In the case against Sisodia, the Supreme Court put the entire case so far into question. The SC pointed out that the Prevention of Money Laundering Act (PMLA) that ED is operating under in the case comes into play not when the bribe is generated but when it's taken or given. The Apex Court said that the ED has so far not been able to show that the bribe has reached Sisodia. 

"As per your case, no money has come to Manish Sisodia. So how did the money flow from the liquor group? You have taken two figures: 100 crores and 30 crores. Who paid them this? There can be so many people paying the money, not necessarily connected to liquor...You have to establish a chain…This doesn’t fully establish. You see, the money has to flow from the liquor lobby to the person. Both of us agree with you that it is difficult to establish the chain because everything is done under cover…But that’s where your competence will come in," said the Supreme Court, as per The Express.

The SC further said, "PMLA does not deal with generation. It deals with processes or activity connected with the proceeds of the crime. So, till the proceeds of the crime come into place, PMLA does not come into place...When a bribe is given, you are involved in the activity connected to the proceeds of crime. Suppose, ultimately no money is passed on, will PMLA trigger?…PMLA will be triggered after proceeds of crime are given or paid. You have to connect the person concerned with the proceeds of crimes, directly or indirectly."

While Sisodia and Singh are under arrest in the Delhi Excise Policy case, another AAP leader and a former minister, Satyender Jain, is already in jail for another case of money laundering. These leaders are among a number of leaders under the net of ED and CBI, which include Jharkhand Chief Minister Hemant Soren, Trinamool Congress (TMC) leaders Abhishek Mukherjee, Shiv Sena leader Sanjay Raut, etc.

In his story from Jharkhand, Md Asghar Khan writes about the ED's campaign in the state where CM Soren has been held accused. 

In an earlier story, Madhur Sharma traced the evolution of the ED as the state's sword-arm and what legal provisions make the agency much more powerful than the state police and even the CBI that earlier used to make most of the headlines. 

Sharmita Kar in her story writes about the Opposition leaders across the parties that have come under the scanner of central agencies, including leaders from the Eknath Shinde's Shiv Sena faction, the DMK, TMC, etc.

In the run-up to the 2024 general elections, as the Opposition comes together against the Bharatiya Janata Party (BJP), the discourse around the Centre's charge of a corrupt Opposition and the Opposition's charge of the Centre leading a witch-hunt is expected to get sharper. It is in such a heated political atmosphere that the SC's rap on the ED's wrists has come.