Improper to force Lok Sabha election candidate to appear before ED on eve of polls: Kerala High Court

The Kerala High Court on Tuesday observed that it would be improper to force Dr. Thomas Isaac, a CPI(M) candidate standing for the Lok Sabha Elections 2024, to appear before the Enforcement Directorate when the elections are less than a month away [Dr. TM Thomas Isaac v. The Deputy Director], [Kerala Infrastructure Investment Board (KIIFB) v. Director].Justice TR Ravi was considering petitions moved by former Former State Finance Minister Isaac and officials of Kerala Infrastructure Investment Fund Board (KIIFB) challenging the issuance of summons to them in connection with ED's probe in the masala bonds case. .The Court noted that while the information placed before it by the ED at the Court's request showed that there are some transactions that may require further explanation, forcing the officials and Isaac to appear before the ED would be unnecessary at this time."Counsel appearing for ED had made available some material to show that there are transactions relating to the end use of the funds received which needs explanation. I have gone through it but I do not feel that this is the right stage for me to disclose the information given to me. However I find that some transactions require explanation and it can be done at a later stage especially since the elections are due. The petitioner in WPC 3719/2024 (Isaac) is a candidate and I do not think it is proper for a candidate who is facing an election for representation to parliament to be disturbed at this stage when elections are due," the Court said in its order..The Court proceeded to adjourn the case to May 22 when it will reopen after its upcoming summer vacation. .The case before the Court involves allegations that the Foreign Exchange Management Act (FEMA) was violated in the issuance of Masala Bonds by KIIFB. Masala bonds are rupee-denominated bonds issued outside India by Indian entities.KIIFB officials and Isaac first filed petitions before the High Court in 2022 challenging the ED summons issued to them in connection with the central agency's probe.However, in December 2023, the ED informed the High Court that it had decided to withdraw the summons.At the time, the Court had clarified that the ED was free to continue its probe in the case.However, the ED issued fresh summons to Isaac and KIIFB officials in January this year following which Isaac and KIIFB filed this fresh round of petitions challenging the same..The primary ground raised by both Isaac and the KIIFB officials is that the summons issued to them contain no mention of what transactions are being investigated.Finding the same to be true at the last hearing, Justice Ravi had orally asked Additional Solicitor General (ASG) ARL Sundaresan, who appeared for the ED, to submit at least one example of a specific transaction which is suspect.The same is only to satisfy the Court's conscience and need not be provided to the persons who have been summoned, Justice Ravi had said..Today, the Court went through the material supplied by the ED but decided against directing Isaac or KIIFB officials to appear before the ED at least until the next date of hearing which is scheduled on May 22..Senior Advocate Jaideep Gupta appeared for Isaac while Senior Advocate Arvind Datar appeared for the KIIFB officials.Additional Solicitor General of India ARL Sundaresan appeared for the ED. .[Read Order]