The Supreme Court said on Tuesday it doesn't want Delhi Chief Minister Arvind Kejriwal to discharge his official duties if he is released on interim bail in the money laundering case linked to the alleged excise policy scam as it would lead to a conflict of interest.

Kejriwal failed to get any relief from the top court, with a two-judge bench rising without pronouncing an order granting him interim bail to enable him to campaign in the Lok Sabha elections.

The Aam Aadmi Party (AAP) leader was arrested on March 21 and is currently lodged in Tihar Jail under judicial custody.

A bench of Justices Sanjiv Khanna and Dipankar Datta, which reserved its verdict on the question of interim bail, said allowing Kejriwal to attend his office may have a "cascading effect".

"Suppose we grant you interim bail on account of elections. Then if you say you will attend office, it may have a cascading effect. If we give you interim bail, we don't want you to perform official duties as somewhere it will lead to conflict of interest. We don't want your interference at all in the working of the government," the bench told senior advocate Abhishek Singhvi, appearing for Kejriwal.

Singhvi said he is making a statement that Kejriwal will not deal with files related to excise policy. However, he later submitted that Kejriwal won't sign any official files if released on interim bail provided the Delhi lieutenant governor does not reject decisions just because the files were not signed by him.

"First let us see whether at all interim bail can be given or not," the bench told Kejriwal's counsel.

Solicitor General Tushar Mehta, appearing for the Enforcement Directorate, staunchly opposed showing any leniency to Kejriwal on account of the Lok Sabha polls and said granting interim bail to the AAP national convenor would amount to creating a separate class for politicians.

The bench said, "We are not going by whether it is a case of a politician or not a politician. Every particular individual involved has some special or exceptional case or circumstances. We are only considering whether this case requires an exception or if the person involved is in that exceptional circumstance, given the fact that elections are round the corner, that's all." "Please do not take it that we are saying that there's a different law followed for politicians," the bench said.

Mehta submitted that letting out Kejriwal on the ground of the ongoing elections will set a bad precedent and others will seek similar exemptions.

"The Court is allowing to open the doors of contingencies just to let out this one person. The public prosecutor will not be able to argue a case if tomorrow a 'kirana' shop owner or an agriculturist comes and seeks relief in a case. I know these are inconvenient arguments," he said.

He added the moment the court considers granting relief to Kejriwal for the elections it will create a separate class for politicians.

"There are around 5,000 cases involving MPs pending across the country at this time. Will all of them be released on bail? Is an agriculturist who has a harvesting and sowing season less important than a politician?" Mehta submitted, adding that Kejriwal would not have been arrested had he cooperated in the investigation and not evaded nine summonses.

The SG urged the bench not to make an exception for Kejriwal as it will send a wrong message and demoralise the common man.

"Campaigning in elections is a luxury for a politician but for an agriculturist harvesting is not a luxury. That's his bread and butter," he said.

During the hearing which continued for nearly three hours, the bench said Kejriwal is not a habitual offender.

"He is the CM of Delhi and an elected leader. Elections are going on. This is an extraordinary situation. It is not like he is some kind of a habitual offender. Normally, the Lok Sabha elections are held every five years," the court said.

Additional Solicitor General SV Raju, also appearing for the ED, took the court though the statements of witnesses and accused in the case.

The bench, after hearing the arguments and perusing a note given by Raju, asked why the ED has taken so much time to probe the case.

It asked the probe agency to produce the case files before and after the arrest of Delhi's former deputy chief minister Manish Sisodia, who is also an accused in the case. Later, the bench also sought case files, which run into many volumes, of the period prior to Kejriwal's arrest.

Raju told the court that initially Kejriwal was not the focus of the investigation and that his role became clear at a later stage.

He claimed Kejriwal had stayed in a grand seven-star hotel during the 2022 Goa Assembly polls and a part of the bills was paid by the Delhi government's general administration department.

Kejriwal's main petition challenging his arrest remains pending as the hearing was inconclusive.

The case relates to alleged corruption and money laundering in the formulation and execution of the Delhi government's now-scrapped excise policy for 2021-22.

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