The Supreme Court on Tuesday declared as “illegal” the last two extensions granted to Enforcement Directorate chief Sanjay Kumar, the latest effective till November 2023, in a setback to the Narendra Modi government.

Mishra, who had retired in May 2020, continues to be on extension at a time the ED has been carrying out sustained raids on Opposition leaders and the government’s critics.

The apex court cited its September 8, 2021, judgment that prohibited any further extensions to Kumar beyond November 2021, and said the government’s attempts to bypass it through the retrospective use of subsequent legal amendments was an “impermissible exercise”.

The court, however, allowed Kumar to continue in office till July 31 to ensure a “smooth transition”, after the Centre pleaded that his services were needed in connection with an intergovernmental exercise related to combating money laundering globally.

The bench of Justices B.R. Gavai, Vikram Nath and Sanjay Karol was dealing with a batch of public interest petitions from the NGO Common Cause, Congress politician Jay Thakur and others challenging the repeated extensions granted to Kumar as ED director.

Union home minister Amit Shah issued a tweet saying it did not matter who the ED director was, PTI added.

Shah tweeted: "Those rejoicing over the Hon'ble SC decision on the ED case are delusional for various reasons: The amendments to the CVC Act, which were duly passed by Parliament, have been upheld. Powers of the ED to strike at those who are corrupt and on the wrong side of the law remain the same. ED is an institution which rises beyond any one individual.... Thus, who the ED director is — that is not important because whoever assumes this role will take note of the rampant corruption of a cosy club of entitled dynasts who have an anti-development mindset."

The ED reports to the finance ministry. Its mandate is to investigate money laundering and foreign exchange law violation offences, not to go after any individuals or groups. It is not clear why Shah mentioned "entitled dynasts" and "anti-development mindset".

The Opposition Congress said the verdict was "a vindication of our stand on brazen misuse and compromise of ED for political vendetta...."

The judgment said: “This court has specifically issued a mandamus (judgment-directive) that no further extension shall be granted to the second respondent (Kumar). The mandamus issued to the parties (theCentre and Kumar) was binding on them.

“We, therefore, find that the respondent No. 1 (Union government) could not have issued orders dated 17th November 2021 and 17th November 2022 in breach of the mandamus issued by this court vide its judgment dated 8th September 2021 in Common Cause (2021).”

Quoting from a seven-judge ruling of 1978, the bench said: “The effect of the judgments of the court can be nullified by a legislative act removing the basis of the judgment. Such law can be retrospective. Retrospective amendment should be reasonable and not arbitrary and must not be violative of the fundamental rights guaranteed under the Constitution.”

The bench ruled that the retrospective use of amendments to bypass the September 2021 mandamus was “arbitrary” and violative of fundamental rights.

“This court has further held that transgression of constitutional limitations and intrusion into the judicial power by the legislature is violative of the principle of separation of powers, the rule of law and of Article 14 of the Constitution of India,” it said.

However, the bench upheld the amendments themselves, made to facilitate the grant of extensions to the ED and CBI directors and other secretary-level officers in the public interest.

These are the Central Vigilance Commission (Amendment) Act, 2021, Delhi Special Police Establishment (Amendment) Act, 2021, and the 103 Fundamental (Amendment) Rules, 2021.

“In the present case also, we may point out that in Common Cause (2021), this court had not struck down any law, but had issued a mandamus which was binding on the parties before it,” the bench said.

It also took into consideration the Centre’s plea that Kumar’s services were required for a review meeting related to the Paris-headquartered Financial Action Task Force, which evolves global strategies to curb money laundering and whose 200-odd members include India.