CBI, ED Probes Into Election Spending Must Not Become Tools To Influence Political Outcomes: Delhi Court In Liquor Policy Case

A Delhi Court on Friday said that the investigations by Central Bureau of Investigation (CBI) or Enforcement Directorate (ED) cannot be allowed to enter the “political arena” on mere allegations of excessive electoral spending by a political party.

Special Judge Jitendra Singh of Rouse Avenue Courts said that permitting such a scenario would lead to “criminalisation of electoral competition” and would arm the executive with “coercive instruments capable of influencing political outcomes.”

“If investigative agencies such as the CBI or enforcement authorities under the Prevention of Money Laundering Act, 2002 (PMLA) were permitted to enter the electoral arena merely on allegations of “cash spending”, “illegal funding”, or “unaccounted expenditure”, the inevitable consequence would be the criminalisation of electoral competition,” the Court said.

“Such an approach would arm the executive with coercive instruments capable of influencing political outcomes, thereby eroding the level playing field that lies at the heart of free and fair elections,” it added.

The judge made the observations while discharging Aam Aadmi Party supremo Arvind Kejriwal, Manish Sisodia, Telangana Jagruthi founder K Kavitha and 20 others in the corruption case related to the alleged liquor policy scam case.

The supplementary chargesheets filed by CBI in the case alleged that there was diversion and utilisation of a substantial portion of the purported illegal gratification for election-related expenditure by AAP.

CBI alleged that out of Rs. 90–100 crores, an amount of approximately Rs. 44.54 crores was utilised for the Aam Aadmi Party's Goa Assembly Election campaign of 2022.

The agency alleged that the amount was moved from Delhi to Goa through hawala or angadiya operators in multiple tranches, using different conduits and cash handlers.

As per CBI, Durgesh Pathak was the in-charge for Goa during the relevant period and that he exercised supervisory and coordinating control over the party's election campaign in Goa.

Dismantling the prosecution case, the judge said that even if the said allegation is assumed to be correct in its entirety, such conduct, by itself, does not disclose any violation of the election law framework.

It said that there is no prohibition in law against a political party funding or meeting the campaign expenses of its candidates, and such funding, per se, does not attract any penal consequence.

The judge said that CBI failed to place any material to show that Pathak either provided cash, arranged cash, directed cash payments, or acted as a conduit for the alleged cash utilised in the elections.

“The Court expresses its serious disapproval of the manner in which the investigating agency has sought to implicate A-19 (Durgesh Pathak) without placing on record any material indicative of his knowledge, participation or involvement in the alleged conspiracy or the alleged proceeds of crime,” the Court said.

“Criminal liability cannot be fastened on the basis of political position, organisational role or supervisory responsibility. To compel an individual to face criminal prosecution on the strength of conjecture and association is wholly impermissible and runs contrary to settled principles of criminal jurisprudence, where the process itself cannot be permitted to operate as punishment,” it added.

Further, the judge held that criminal law cannot be employed as a substitute for election-law remedies, nor as a device to convert political accusations into prosecutable offences, unless a clear, independent, and cognisable criminal offence, wholly distinct from election-law violations, is prima facie disclosed in accordance with law.

“Accordingly, this Court holds that investigations by the State police, the CBI, or the Enforcement Directorate cannot be initiated or sustained solely on allegations of election-funding irregularities and excess expenditure,” the Court said.

The judge said that to permit the CBI to independently assume jurisdiction over election-expenditure allegations would amount to the executive arrogating to itself a supervisory role over elections, which is impermissible in law. The position is no different, and indeed more restrictive, under the PMLA, the Court said further.

The Court also held that allegations of excess election expenditure, cash usage, or undeclared campaign spending do not, by themselves, constitute scheduled offences under the PMLA.

It added that allegations of “hawala” or cash transactions, unaccompanied by independent, legally admissible evidence establishing the illegality of the source and its nexus with a defined offence, cannot sustain criminal prosecution under PMLA.

It also said that investigative agencies, which form part of the executive, cannot be permitted to displace or supplant this constitutional authority by assuming functions that the Constitution has reserved for the ECI and the election courts

“To permit investigative agencies to act independently, without such referral or without disclosure of a legally cognisable scheduled offence, would be to invert the constitutional hierarchy, reducing the Election Commission to a peripheral observer in a domain where it is meant to be supreme,” the Court held.

Also Read: Breaking | All Accused Including Arvind Kejriwal, Manish Sisodia Discharged In Liquor Policy Case, Delhi Court Raps CBI For Lapses