West Bengal Chief Minister Mamata Banerjee had put “entire democracy at risk” by obstructing Enforcement Directorate (ED) searches at the Kolkata offices of political consultancy firm I-PAC and the residence of its director Pratik Jain earlier this year, the Supreme Court said on Wednesday.
In forceful remarks a day before the first phase of the West Bengal elections, a bench of Justices Prashant Kumar Mishra and N V Angaria clarified that the controversy went beyond a routine state-central dispute, setting it instead as an example of the individual conduct of a constitutional functionary with far-reaching implications.
“This is not a state-Union dispute. The Chief Minister of any state cannot walk in the midst of an investigation, endangering democracy… This in itself is an act committed by an individual who happens to be the Chief Minister, thereby putting the entire democracy at risk,” the bench observed.
The court added that even constitutional thinkers like BR Ambedkar and HM Seervai could not have envisaged a situation where the sitting Prime Minister would interfere during the ongoing search by a central agency.
“You took us through Survai, Ambedkar, but none of them could have imagined this situation in this country that one day the sitting Prime Minister would enter the office in this way…” the bench said.
The remarks came during the hearing of petitions filed by the ED and its officials under Section 32 seeking a Central Bureau of Investigation (CBI) investigation into the alleged obstruction.
Noting the unusual nature of the case, the bench said it could not “turn a blind eye to the reality” on the ground in West Bengal, terming the case “extraordinary” and requiring the court to take into account “social and political realities”.
“This is not a lawsuit between Ram and Shyam… the features are completely different,” the court said, rejecting the state’s attempts to turn the matter into a traditional legal dispute over maintainability.
The bench was not convinced by the submissions submitted by senior advocates, including Abhishek Manu Singhvi, Siddharth Luthra and Menaka Guruswamy, that the ED’s plea was not maintainable under Article 32 as the agency lacked fundamental rights.
She wondered whether every such petition should be referred to a constitutional body, noting that “in every question, there will be some legal issue.”
At the same time, the court responded to arguments that the ED should have pursued remedies before a judge, citing previous proceedings where it had noted allegations of judicial officers being “held hostage” in the state.
“Before the other court where the FIR is being interrogated, we saw the situation of several judicial staff being held hostage. And you want the petitioner to go to a judge? We cannot close our eyes to the reality of what is happening. We cannot lose sight of the practical situation that exists in the state,” the bench said. She was referring to the judicial proceedings initiated by a bench led by Chief Justice of India Surya Kant, in connection with the April 1 incident in Malda district, where seven judicial staff, participating in the special intensive review process, were detained. (SIR), held hostage for hours by demonstrators.
The controversy dates back to January 8, when Banerjee entered the I-PAC headquarters and Jain’s residence during ED searches linked to a money laundering investigation stemming from a 2020 coal smuggling case. The agency claimed that documents and electronic devices linked to the investigation were removed during the episode.
However, Banerjee maintained that the materials related to her party’s electoral strategy and accused the ED of conducting politically motivated research ahead of the high-stakes elections.
The case has since escalated into a broader institutional standoff, with the executive invoking Section 32 — a move the state said was constitutionally impermissible for a government agency.
Earlier, the Supreme Court warned that “it will not be a happy situation” if the investigating agency is left without any legal redress in the face of such alleged obstruction, stressing that the Constitution does not contemplate an accountability vacuum.
The backdrop to the legal battle was an extensive investigation into I-PAC’s financial dealings.
On April 14, a Delhi court ordered the remand of company director Vinesh Chandel to the custody of the ED, observing that he was prima facie involved in “generation, conversion and possession” of proceeds of crime amounting to several crores.
The court cited allegations that funds linked to a coal smuggling ring were funneled through hawala channels to the company, and pointed to attempts to delete emails and sensitive data after searches in January, which, according to investigators, indicated efforts to obstruct the investigation.
The ED probe stemmed from a CBI probe alleging illegal mining and sale of coal from Eastern Coalfields Ltd areas in West Bengal, with businessman Anup Majhi identified as a key figure in the alleged syndicate.
Before the Supreme Court, the state and its officials questioned whether the investigating agency or its officials could invoke Section 32 to challenge the alleged obstruction by the state government or its officials.
While the state claimed that fundamental rights could only be enforced by citizens and not government departments, the Court repeatedly noted that procedural limitations could not be used to protect actions that might undermine the rule of law. Noting that it may consider both maintainability and merit together, the bench noted that constitutional adjudication must evolve with emerging governance challenges.
The session will continue on Thursday.
