Today’s Current Affairs (01-April-2023)
What is Enforcement Directorate?
- The Directorate of Enforcement is a multi-disciplinary organization mandated with investigation of offence of money laundering and violations of foreign exchange laws.
- It is composed of officers from the Indian Revenue Service, Indian Police Service, and the Indian Administrative Service as well as promoted officers from its cadre.
- In addition to direct recruitment, the Directorate also draws officers from different Investigating Agencies like Customs & Central Excise, Income Tax, Police, etc. on deputation.
- The Enforcement Directorate has its headquarters in New Delhi. There are five regional offices in Mumbai, Chennai, Chandigarh, Kolkata, and Delhi headed by Special Directors of Enforcement.
Director of ED
- The tenure of the ED director has been extended from two years to five years in 2021.
- The change in tenure of the ED Director was done by amending the Central Vigilance Commission Act, 2003.
- The ED director can be appointed initially for two years. But if needed, the tenure can be extended for three more years by three separate annual extensions with no further extension after 5 years.
History of Enforcement Directorate
- The origin of this Enforcement Directorate goes back to 1st May, 1956, when an ‘Enforcement Unit’ was formed in the Department of Economic Affairs
- In the year 1957, this Unit was renamed as ‘Enforcement Directorate’. In 1960, the administrative control of the Directorate was transferred from the Department of Economic Affairs to the Department of Revenue.
- For a short period of 04 years (1973 – 1977), the Directorate remained under the administrative jurisdiction of the Department of Personnel & Administrative Reforms. Presently, the Directorate is under the administrative control of Department of Revenue, Ministry of Finance, Government of India.
- In tune with the International Anti Money Laundering regime, the Prevention of Money Laundering Act, 2002 (PMLA) was enacted and ED was entrusted with its enforcement w.e.f. 1st July 2005
- Recently, with increase in the number of cases where economic offenders took shelter in foreign countries, the Government has passed the Fugitive Economic Offenders Act, 2018 (FEOA) and ED is entrusted with its enforcement with effect from 21st April, 2018.
ED comes in picture :
- Whenever any economic offence involving more than ₹1 crore is registered by the local police, the investigating police officer from that police station forwards the details to ED.
Statutory functions of ED
The statutory functions of the Directorate include enforcement of following Acts:The Foreign Exchange Management Act, 1999 (FEMA):
The Foreign Exchange Management Act, 1999 (FEMA):
- It is a civil law enacted to consolidate and amend the laws facilitating external trade and payments and to promote the orderly development and maintenance of foreign exchange market in India.
- Under this role of ED: ED has been given the responsibility to conduct investigation into suspected contraventions of foreign exchange laws and regulations, and to adjudicate and impose penalties on those adjudged to have contravened the law.
The Prevention of Money Laundering Act, 2002 (PMLA):
- It is a criminal law enacted to prevent money laundering and to provide for confiscation of property derived from, or involved in, money-laundering and for matters connected therewith or incidental thereto.
- Under this role of ED: ED performs its duty by conducting investigation to trace the assets derived from proceeds of crime by provisionally attaching the property and to ensure prosecution of the offenders and confiscation of the property by the Special court.
The Fugitive Economic Offenders Act, 2018 (FEOA):
- This law was enacted to deter economic offenders from evading the process of Indian law by remaining outside the jurisdiction of Indian courts.
- Under this role of ED: Directorate is mandated to attach the properties of the fugitive economic offenders who have escaped from the India warranting arrest and provide for the confiscation of their properties to the Central Government.
Issues associated with Enforcement Directorate
- The ED has often been attacked for initiating investigations, raiding and questioning leaders of opposition parties. be it under the current regime or under past governments.
- PMLA is being pulled into the investigation of even ordinary crimes by the Enforcement Directorate.
- Petitioners pointed out that even the Enforcement Case Information Report (ECIR) – an equivalent of the FIR – is considered an “internal document” and not given to the accused.
- The ED is the only Central agency in the country that does not require permission from the government to summon or prosecute politicians or government functionaries for committing economic offences like money laundering. [The issue is not specific whether there should be more than one agency or the despotic nature of ED]There is also a lack of clarity about ED’s selection of cases to investigate.
- There is also a lack of clarity about ED’s selection of cases to investigate.
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