The ED's Jurisdiction and Federalism: A Supreme Court Examination
UPSC Relevance
Prelims: Indian Polity and Governance (Federalism, Centre-State relations, Constitutional/Statutory bodies - Enforcement Directorate (ED)); Indian Economy (Money Laundering, Prevention of Money Laundering Act - PMLA).
Mains:
General Studies Paper 2 (Polity & Governance): Functions and responsibilities of the Union and the States, issues and challenges pertaining to the federal structure; Appointment to various Constitutional posts, powers, functions and responsibilities of various Constitutional Bodies. The role and alleged misuse of central agencies like the ED in the context of federalism is a major and recurring theme.
General Studies Paper 3 (Security): Money-laundering and its prevention.
Key Highlights from the News
The Supreme Court expressed concern over whether the Enforcement Directorate's (ED) investigation into money laundering cases against TASMAC, a Tamil Nadu government entity, encroaches upon the investigative powers of states.
The court also questioned whether such investigations could weaken the country's federal structure.
Key Arguments of the Tamil Nadu Government:
The state Vigilance Department, not the ED, should investigate this matter concerning corruption.
The ED is exceeding its jurisdiction.
Key Arguments of the ED:
They are only investigating money laundering arising from a predicate offence registered by the state police.
The state government is attempting to quash the FIRs of the underlying predicate offence to nullify the ED's case.
The court decided to consider this case in detail after a verdict is pronounced on the review petitions challenging the 2022 Vijay Madanlal Choudhary judgment, which upheld the ED's powers.
The ED reiterated its stance that the Enforcement Case Information Report (ECIR), containing case details, is merely an "internal document" and need not be provided to the accused.
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