Origin of ED (Enforcement Directorate)
- ED was Constituted in 1956 originally for handling Exchange Control law violations under FERA
- Today ED has become a multi-disciplinary organisation mandated to act under the provisions of various laws.
- Administrative Control of the ED lies with the Department of Revenue, Ministry of Finance (DoR, MoF)
- ED is neither a statutory nor constitutional organization.
Multidisciplinary Role of ED Nowadays
The ED is a multi-disciplinary organization mandated with the investigation of offense of
- Money Laundering
- Violations of foreign exchange laws.
The statutory functions of ED include the enforcement of following Acts:
The Prevention of Money Laundering Act, 2002 (PMLA) – Criminal Law
- Prevent money laundering
- Provide for confiscation of property derived from, or involved in, money laundering and for matters connected therewith or incidental thereto.
- Investigation to trace the assets derived from proceeds of crime
- Provisionally attach the property
- Prosecution of the offenders and confiscation of the property by the Special Court.
The Foreign Exchange Management Act, 1999 (FEMA) – Civil Law
- ED has been given the responsibility to conduct investigation into suspected contraventions of foreign exchange laws and regulations, to adjudicate and impose penalties on those adjudged to have contravened the law.
- Earlier instead of FEMA, Foreign Exchange Regulation Act, 1973 (FERA) was in force. In 1999 with the onset of FEMA, FERA was repealed. ED is to adjudicate the Show Cause Notices issued under FERA upto 31.5.2002 for the alleged contraventions of the Act which may result in imposition of penalties and to pursue prosecutions launched under FERA in the concerned courts.
The Fugitive Economic Offenders Act, 2018 (FEOA) – Criminal Law
- This law was enacted to deter economic offenders from evading the process of Indian law by remaining outside the jurisdiction of Indian courts.
- ED 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.
Sponsoring agency under Conservation of Foreign Exchange and Prevention of Smuggling Activities Act, 1974 (COFEPOSA) – Criminal Law
The ED often initiates actions under PMLA or FEMA and refers cases to authorities for invoking COFEPOSA if the offender poses a continuous threat. For example, if ED uncovers a smuggling network and believes detention is necessary to stop the offender from continuing the activity, COFEPOSA can be applied.
Organisational Structure of Enforcement Directorate (ED)
A. The ED operates in the following five jurisdictions across India apart from its Headquarters in Delhi, India.
- Central Region (Office at Delhi)
- Northern Region (Office at Chandigarh)
- Eastern Region (Office at Kolkata)
- Western Region (Office at Mumbai)
- Southern Region (Office at Chennai)
B. Every Region is headed by a Special Director
C. Every Region has Zonal Offices and every Zonal Office has Sub Zonal Offices. Each Zone is headed either by an additional director or by a joint director and each Sub Zonal Office is headed by a deputy director.
D. The hierarchy of the ED offices is as follows:
Headquarters (HQ) -> Regional Offices (RO) -> Zonal Offices -> Sub Zonal offices
E. The Headquarters is sub-divided into three divisions
- The headquarters itself for administration purposes like accounts, prosecution, vigilance etc.
- High-Intensity Unit (HIU)
- Adjudication Division
How is the ED Director appointed?
As per section 25 of the CENTRAL VIGILANCE COMMISSION ACT, 2003, the Director of Enforcement in the ED shall be appointed by Central Government on the recommendation of the Committee consisting of the following:
- Central Vigilance Commissioner — Chairperson;
- Vigilance Commissioners — Members;
- Secretary to the Government of India in-charge of the Ministry of Home Affairs in the Central Government — Member
- Secretary to the Government of India in-charge of the Ministry of Personnel in the Central Government — Member
- Secretary to the Government of India in-charge of the Department of Revenue, Ministry of Finance in the Central Government — Member
The recommending Committee shall consider the integrity and experience of the officers eligible for appointment.
What is the rank and tenure of Director of ED office?
- The director of ED shall be of at least of the rank of Additional Secretary to the Government of India
- Director of Enforcement shall continue to hold office for a period of not less than two years from the date on which he assumes office. The term can be extended by one year at a time with the maximum total tenure of 5 years. The extension can be granted in public interest, on the recommendation of appointing Committee by recording the reasons in writing
How the other officers of ED are appointed?
- Same Committee which appointed Director of ED shall recommend officers for appointment to the posts above the level of the Deputy Director of Enforcement after consultation with the Director of Enforcement.
- The same committed shall also recommend the extension or curtailment of the tenure of such officers in the Directorate of Enforcement
