The Karnataka High Court on Tuesday stayed the Enforcement Directorate's (ED) move to summon advocate Anil Gowda, a legal consultant to Congress MLA KC Veerendra Puppy, in connection with a money laundering case involving allegations of illegal betting and gambling [Anil Gowda H v. Directorate of Enforcement].
Justice Sachin Shankar Magadum said that the summons will remain stayed until the Supreme Court decides on a pending question regarding the scope of ED powers when it comes to summoning lawyers.
The High Court clarified that the ED is restrained from taking any coercive action against Gowda in connection with the matter until further orders or until the Supreme Court settles the larger question before it.
During hearings, the Court had questioned the ED on the lack of supporting documents to substantiate the allegations against Gowda. The ED's counsel, in turn, had assured the Court that these documents would be submitted.
Later, the ED, represented by Additional Solicitor General Aravind Kamath, submitted documents before the Court, which he claimed backed up the ED's stance that Gowda was not being summoned in his capacity as a lawyer, but on account of his alleged role in the illegal betting case.
In his petition, Anil Gowda claimed that the ED was trying to incriminate him out of political vendetta and that the proceedings against him as well as Congress leader KC Veerendra were rooted in a bid to muzzle opposition leaders in India.
He alleged that the MLA's recent arrest in this case was a part of this design.
According to Gowda's petition, the ED's proceedings were initiated on the basis of first information reports (FIRs) from the past 10-15 years.
In one such FIR registered in 2011, all the accused were acquitted in 2014, the plea said. Another such FIR registered in 2015 was quashed in 2016. In a third FIR registered in 2016, two other accused pleaded guilty and were convicted. In a fourth FIR registered in 2022, KC Veerendra's name was dropped from the list of accused after the investigation was complete, the plea added.
Gowda contended that although he has not been named in the FIRs or chargesheets, the ED issued summons to him on August 24 seeking his property details, tax records and information about his legal work for Veerendra.
Senior Advocate Vikas Pahwa, appearing for Gowda, argued that the ED’s summons was related to Gowda's professional role as a lawyer.
He contended that the legal advise given by Gowda to Veerendra is protected. Reference was also made to the suo motu case pending before the Supreme Court, where the top court is slated to decide on the limits of ED summons to advocates.
The ED, which was represented by ASG Kamath and advocate Madhukar Deshpande, maintained that Gowda was summoned not in his capacity as a lawyer but because he was allegedly a partner in several commercial companies including KC Veerendra's company.
There are serious allegations against him of making illegal investments in connection with which the summons has been issued, the ED said.
During the hearing of the matter on August 29, Deshpande had also argued that lawyers cannot claim exemption when they are summoned in relation to their direct involvement in a crime.