Supreme Court Refuses To Interfere With Calcutta HC's Restrictions On Use Of Trinamool Bank Accounts Frozen By ED

A bench of Justices MM Sundresh and PB Varale was dealing with TMC's plea challenging the Calcutta High Court's July 20 interim order whereby it refused to permit the party to operate 3 HDFC bank accounts, as well as the July 9 order which allowed the use of those accounts for daily expenses under the supervision of the Court-appointed Special Officer.

The bench also heard a separate petition filed by Biswanath Das, a rebel TMC leader, who challenged the July 9 order, contending that he represents the real party.

The Supreme Court disposed of both the petitions, observing that the High Court's order was "balanced". The Court also allowed Biswanath Das to raise his objections before the Special Officer. The Court clarified that all contentions are open to be raised in the main petition pending in the High Court.

“We will not say anything. We will dispose of both the matters and leave it to the discretion of the Special Officer appointed by the High Court. Whatever you want to say, say it in the main petition,” Justice Sundresh said.

Justice Sundresh said that the July 9 order of the High Court ensured that the daily operations are not stalled.

Senior Advocates Kapil Sibal, Abhishek Manu Singhvi and Menaka Guruswamy appeared for TMC. Additional Solicitor General SV Raju appeared for the ED. Senior Advocate K Parameshwar appeared for Biswanath Das.

The ED has frozen 3 TMC bank accounts allegedly containing around ₹440 crores. According to the agency, the action forms part of its money laundering investigation into alleged transfers of funds to Carewell Aviation India and an associated entity between April 2023 and June 2026 in connection with the purported acquisition of an aircraft and a helicopter. Last week, the Court had asked ED to explore if some amount can be released from the accounts for the party's daily expenses.

Why should the entire accounts be frozen? Sibal

Sibal submitted that the party had approximately Rs 164 crore in funds which, according to the party, were not encumbered by the Enforcement Directorate. He referred to additional affidavits concerning 36 accounts, comprising five bank accounts and 31 fixed deposits. He submitted that if the fixed deposits were encashed, the proceeds would be credited to accounts which had subsequently been frozen..

“The alleged proceeds of crime is Rs 60 crores. Bank has more than Rs 400 crores. Why should all of it be frozen?” Sibal asked.

He submitted that the freezing of the accounts was preventing the party from meeting its ordinary financial obligations, including payment of salaries.

According to Sibal, the party employs approximately 250 employees and salaries amounting to around Rs 53.23 lakh for the current month were due. There were also contractual payments to agencies providing office personnel and security services.

He said the party's expenditure for 17 offices was around Rs 1 crore per month and that invoices of vendors engaged in connection with election-related activities were also pending. Sibal further alleged that accounts of recipients and service providers had also been frozen.

He referred to the High Court's July 9 order, under which a former High Court judge was appointed as Special Officer and three accounts were permitted to be operated for day-to-day expenditure until September 30. Sibal alleged that the investigating agency had frozen the accounts after the High Court indicated that it was going to pass an interim order. He also questioned the attachment of accounts belonging to a company from which the party had taken aircraft-related services.

ED: Rs 125 Crore Available For Day-To-Day Operations

ASG Raju  submitted that the Supreme Court's earlier concern was whether the TMC would be able to meet its day-to-day expenditure. He said that three bank accounts were available for day-to-day operations under the High Court's July 9 order.

Raju submitted that accounts maintained with Indian Bank were free from any ED encumbrance and that approximately Rs 125 crore was available. He further stated that two of the accounts did not have any encumbrance even from the local police. When Justice Sundresh asked how much money was available, Raju maintained that Rs 125 crore was available for the party's day-to-day operations.

Sibal, however, disputed this position and submitted that Indian Bank's position showed that the accounts were encumbered. Raju offered to file an affidavit stating that the two accounts were not attached.

Justice Sundresh clarified that the Court was not concerned with the dispute between rival factions of the party. “We are not concerned about the factions. We only thought of considering limited relief,” the Court said.

Rival TMC Faction Opposes Operation Of Accounts

Senior Advocate K Parameshwar, appearing for rebel MLA Biswanath Das, opposed the relief sought by the TMC. He submitted that accounts numbered 2 and 5 in the chart placed before the Court by Sibal were unencumbered.

Senior Advocate Menaka Guruswamy, for TMC, submitted that one of the unencumbered accounts was a newspaper account and another represented membership dues and was intended as a welfare account for members. She argued that these accounts could not simply be used to pay employee salaries or office rent.

“If we use all this to pay salaries then Mr. Raju will come saying that we are using newspaper's money and membership welfare account's money and this is laundering. It will cause governance issues,” she submitted.

Parameshwar alleged that the complaint arose against the backdrop of large-scale financial irregularities in the accounts.

He added that issue which faction was the real party was pending before the Election Commission. He argued that the High Court's interim arrangement effectively gave one faction control over the party's bank accounts while prejudicing the rival faction.

“We are saying we are the Trinamool Congress. If we are the TMC then there is no question of allowing only one faction of the TMC to operate the bank account through the interim arrangement that the High Court has made,” Parameshwar submitted.

He further alleged that one of the accounts had received Rs 360 crore within 20 days after the election was lost. He urged the Supreme Court to permit operation of only one account, while directing the party to disclose the number of accounts and the funds available in them.

The Supreme Court, however, declined to enter into these factual and factional disputes at the interim stage. The Court left it open to the parties to raise their respective objections before the Special Officer and in the pending proceedings before the High Court.

Background

The matter arose from a complaint lodged by West Bengal MLA Biswanath Das before the Bidhannagar Cyber Crime Police on June 18, 2026 alleging that funds generated through illegal activities, misuse of influence and dishonest financial dealings had been routed through three HDFC Bank accounts.

An FIR was registered on the same day under the Bharatiya Nyaya Sanhita and the Information Technology Act. The ED registered an ECIR on June 23, 2026 and following searches, froze six bank accounts including three HDFC Bank accounts belonging to the AITC on July 7, 2026.

The party contended that the freezing action was arbitrary, mechanically undertaken and unsupported by any identifiable proceeds of crime. It also relied on an earlier July 9, 2026 order of a Coordinate Bench permitting operation of the three accounts through a Special Officer for meeting the party's day-to-day expenses.

The High Court however, held that it could not examine the legality of the alleged fund transfers at the interim stage and that the petitioners would have an opportunity to raise their objections before the PMLA Adjudicating Authority as well as in the writ proceedings after exchange of affidavits.

“This Court did not find any prima facie case and balance of convenience and inconvenience in favour of the petitioners. In view of the above, interim order as prayed for by the petitioners, is refused.”, the Court said. It further noted that the ED had analysed the accounts and recorded reasons to believe that substantial transfers had been made to various entities, justifying the freezing order under the PMLA.

Case Title: ALL INDIA TRINAMOOL CONGRESS AND ANR v. UNION OF INDIA AND ORS.

Case No.: SLP (Crl) 13322/2026