ED: Enforcement Directorate

The full form of ED is Enforcement Directorate. It is also known as the Directorate of Enforcement. It was set up in the year 1956. Basically, Enforcement Directorate (ED) is an economic intelligence organization that defends against financial crimes as well as laws of economics in the nation.

The Directorate of Enforcement has the responsibility of enforcing the FEMA (Foreign Exchange Management Act) Act of 1999, and it is also responsible for enforcement of certain provisions that fall under the Money Laundering Prevention Act. Investigation-related work and many prosecution cases that come under the PML have been entrusted or passed on to the Directorate of Enforcement.

The Directorate of Enforcement comes under the administrative control of the revenue department and Finance Ministry of the Government of India. The revenue department of India has control over ED only for operational purposes. The headquarter of the Directorate of Enforcement is located in New Delhi, but it also has many regional offices all across PAN India.

Recently, Sanjay Kumar Mishra (IRS) is appointed as the chief of the Enforcement Directorate that comes in the rank of secretary in the government of India. He was previously holding the position of Chief Commissioner in the Income Tax department.

Note: Before the FEMA became effective in the year 2000 (1 June 2000 to be exact), the ED was enforcing its regulations under the Foreign Exchange Act of 1973.

We have read a brief overview and history of the Directorate of Enforcement in the introduction part of this article. Now, we will discuss the history and overview of the Enforcement Directorate in-depth to learn more about it.

Enforcement Directorate's Detail History

Enforcement Unit of India was formed back then to handle the violations of Exchange control laws acting under the Foreign Exchange Regulation Act (FERA Act) of 1947. If we start tracking back the origin of the Enforcement Directorate, we have to go back to May 1st, 1956. On May 1st, 1956, the 'Enforcement Unit of India' was formed under the Department of Economic Affairs. The enforcement Unit was headed by the chairmanship of the director of Enforcement, who is a legal service officer, and assisted by a legal officer on deputation of the Reserve Bank of India (RBI).

Other than the above-mentioned legal officers, 3 inspectors from the Special Police Establishment were also appointed to 3 offices of the Enforcement Unit (Branches of Bombay and Calcutta beside the Delhi headquarter office). In the year 1960, the Directorate of Enforcement's administrative control was passed on to the Department of Revenue from the Department of Economic Affairs. But before that, in 1957, the name of the Enforcement unit was changed and renamed as Directorate of Enforcement. At the same time, ED had opened one more office in the Madras (Statehood level at that time).

• As time was passed on, amendments and changes were made to FERA Act, and finally, the FERA Act of 1947 was replaced with the FERA Act of 1973. Also, at that time, the Directorate of Enforcement unit was remained under the administrative and jurisdiction control of the Department of Administrative and Personnel Reforms and that too for a short period of 4 years, i.e., from 1973 to 1977.
• As the process of economic liberalization was going on in India, the FERA Act of 1973 that was actually a regulatory law was repealed. Then, in place of the FERA Act of 1973, the FEMA (Foreign Exchange Management Act) Act of 1999 was introduced.
• FEMA Act of 1999 was become effective from 1st June of 2000 and started operating.
• Furthermore, with this, a new law to prevent money laundering - the PMLA (Prevention of Money Laundering Act) Act of 2002 was also introduced in tune with the international regime for anti-money laundering.
• PMLA Act of 2002 was entrusted, with the Directorate of Enforcement, for its enforcement and operations effective from July 1st of 2005.
• So, we can clearly see that with time, the Directorate of Enforcement is carved into a multi-dimensional organization from a single-dimensional.

As of now, Enforcement Directorate enforces and regulates the following two laws in India:

1. FEMA Act of 1999 (a civil law): This law or Act provides quasi-judicial powers to the organization for investigating the suspected contraventions for the Exchange Management and control laws and regulations. With this Act, ED also has the power to those who are found guilty under the contraventions of the FEMA Act.
2. PMLA Act of 2002 (a criminal law): By this law, officers of the organization are empowered to conduct inquiries that mean locating, provisionally, confiscating, or attaching assets derived from the schedule offense act other than prosecuting and arresting the money launderers.

Brief Overview of Enforcement Directorate

Here, we are discussing some basic facts about the Directorate of Enforcement. We will keep them easy and simple so that you can understand them easily. Following are the basic facts related to the Directorate of Enforcement that we should know about:

• The Directorate of Enforcement was formed 65 years ago, on May 1st in the year 1956.
• The operational jurisdiction for Enforcement Directorate is India only.
• Enforcement Directorate comes under the constitutional instrument of the Foreign Exchange Management Act of 1999.
• The parent agency for the Directorate of Enforcement is the Department of Revenue, Finance Ministry.
• Enforcement Directorate is a legal personality since it is a Government agency.
• The minister responsible for the Enforcement Directorate is the Finance minister of India, i.e., Nirmala Sitaraman (Current Finance Minister of India).
• The special jurisdiction on which Enforcement Directorate works is Anti-corruption.
• Executives of Agency: Sanjay Kumar Mishra (IRS) is the Director, and Simanchala Dash (IRS) is the principal special Director of ED nowadays.

List of regional offices of ED in India

The Directorate of Enforcement has a total of 10 regional or zonal offices in which each of which is headed by a Deputy Director of ED.

Here we are providing you with the list of all the regional or zonal offices of the Directorate of Enforcement in India:

• Chandigarh
• Kolkata
• Mumbai
• Lucknow
• Hyderabad
• Chennai
• Delhi
• Ahmedabad
• Cochin
• Bangalore

Additionally, with all these zonal offices, the Directorate of Enforcement also has 11 sub-zonal offices across PAN India in which each of which is headed by the Assistant Directors of ED.

Here is a list of all the sub-zonal offices of the Directorate of Enforcement in India:

• Nagpur
• Jaipur
• Madurai
• Varanasi
• Patna
• Jalandhar
• Bhubaneswar
• Guwahati
• Srinagar
• Indore
• Calicut

Note: Total offices of Directorate of Enforcement in India (Including both regional as well as sub-regional offices) have been increased from 21 to 49 effectively. But, offices other than those 21 we mentioned above in the list are still underway with a full contingent of the workforce and not operational as of now.

Indian Services in ED

As we discussed earlier, the Directorate of Enforcement comes under the Department of revenue, but that doesn't mean that ED is only composed of only revenue service of India. Actually ED is composed of many Indian services such as administrative, revenue, etc.

Following is the list of all the Indian services offices that the Directorate of Enforcement is composed of:

• Indian Administrative Service Office
• Indian Economic department office
• Indian Police Service Office
• Indian Revenue Service Office
• And, Indian Corporate Law Service office
• Also, promoted officers from its own cadre

Enforcement Directorate inducts Assistant Enforcement Officers (AEO) for its own cadre too. The AEO recruited by the Directorate of Enforcement is the only one as the departmental staff of the organization that serves in it.

The objective of the Directorate of Enforcement (ED)

The objectives of ED itself specify the goals and goals of the Directorate of Enforcement, and therefore it becomes very important for us to study them. Following is the list of all the main objectives of the Directorate of Enforcement:

• The first and main objective of ED is to enforce and check the conduct of 2 major laws made by the Indian government: the FEMA act of 1999 and the Money Laundering Prevention Act of 2002 (PMLA, 2002).
• If we go to the official website of the Directorate of Enforcement, then we can see the list of several targets that are indirectly related to Money laundering, and these are the other objectives of ED.
• ED also works as an investigative body in particular, and it also releases full information on public domains that are contrary to guidelines of GUI.

Special Courts under Enforcement Directorate

To punish the culprit for an offense under section 4 of the PMLA Act, the Enforcement Directorate or central government can designate trials at one or more session courts referring to as a special court. The trial designated in special courts is done after consultation with the CJ (Chief Justice) of the High court. The special court set up by ED for such trials under section 4 of the PMLA act is also called "PMLA court." If any appeal has to be raised against any order passed by the PMLA court, it can be directly filled in the respective high court for further jurisdiction of the matter.

Core Values of Directorate of Enforcement:

As the Directorate of Enforcement is one of the premier financial investigations of the Indian Government, it functions strictly adhering to India's Laws and Constitution and respectfully compile with the guidance of all the lawful authorities of India. The Enforcement Directorate always works towards maintaining and establishing high professional credibility and standards.

Following are the core values that are adhered to by these professionals standards, are essential and followed by the Directorate of Enforcement:

• Excellence
• Integrity
• Impartiality
• Commitment
• Accountability

Now, let's study the core values of ED in detail and learn how its aim with its core values and adhere to them.

1. Excellence: The Directorate of Enforcement always aims to provide excellence in all the work they do, and they seek to:

• Sharpening the investigating skills of organization and always learning from the best practices adopted all over the globe.
• Maintain excellent communication with all the members, support teamwork with each other, strictly deal with the discipline issues and encourage delegation with the tasks.
• Regularly improve in the work performance by always looking for upgradation in the methods and systems.
• Always looking to remove the inefficiencies from the task and waste from organization works.

2. Integrity: The directorate of Enforcement looks for integrity in the system, work for culture, and working staff as its core requirement.Directorate of Enforcement believes that integrity as a core value displays:

• The soundness of the honesty, sincerity, and moral principles in the employees of ED.
• Complete trust while passing on information to its employees.
• A very good standard for character and personal conduct of values in employees themselves.

3. Impartiality: Impartiality is also one of the major aspects or core values that the Directorate of Enforcement adheres. According to Enforcement Directorate, Impartiality as a core value aims to:

• Pursing and revealing the truth under any circumstance and situation.
• The employee should act without having prejudiced or biased malice.
• Any employee of ED is not allowed to abuse the power they have in any form.
• Investigations conducted by the employees of the Enforcement Directorate should be fair and sound very reasonable.
• Employees should be able to make decisions with any form of fear and favor of fear.

4. Commitment: For the Directorate of Enforcement, commitment means application, determination, dedication, and perseverance to achieve results with a high success rate and low-risk factors. According to Enforcement Directorate, Commitment as a core value requires:

• Strive to achieve the objectives of organizations as well as the team formed in the committee.
• The employee should apply the commitment to all the tasks that are the responsibility of the organization.

5. Accountability: Enforcement Directorate believes that they are responsible and answerable for the outcomes of all the tasks they perform. Directorate of Enforcement believes that accountability as a core value for the task is:

• Taking responsibility for the results and all the consequences of their actions and the efforts they put into a task.
• Applying the accountability core value to all the employees of organizations and every one of them should be aware of what is expected from them.
• Employees of the Directorate of Enforcement should be aware of how their work and efforts will be evaluated and how they will be held accountable for it.
• Employees of organizations should also be aware of how the success of tasks done by them will be determined and measured.

The function of the Directorate of Enforcement:

Till now, we have discussed the history, overview, objective, and introduction of the Directorate of Enforcement in this article. Now, in this last section, we will discuss the functions of the Directorate to understand its working. We may have some basic idea about the functioning of the Enforcement Directorate with their history and overview, but to understand them in a better way, we have to go through the function list them.

Following are the main functions that the Directorate of Enforcement in India performs:

• Enforcement Directorate has to collect, disseminate and develop intelligence units and information regarding the violations of the FEMA Act of 1999. The intelligence unit developed by the directorate receives inputs from multiple sources intelligence agencies of the central government, intelligence agencies of state government, complaints received from various sources, etc.
• Enforcement Directorate has to adjudicate the cases of violations of the FEMA Act of 1999 as well as the FERA Act of 1973 of the erstwhile.
• The Directorate of Enforcement should impose penalties and enforce them after the conclusions of adjudication proceedings under the violation of the Act.
• Enforcement Directorate also has to handle the appeals, adjudication, and prosecution cases that come under the FERA Act of 1973.
• Enforcement Directorate has to investigate the suspicion of violations that are related to activities such as non-realizations of export proceeds, "Hawala" foreign exchange racketeering, non-repatriation of various foreign exchanges, and many other forms of violations that come under the provisions and regulations of the FEMA Act of 1999.
• The directorate has to undertake the search, survey, arrest, prosecution actions, seizures, etc., against the offenders, found guilty under the violations of the PMLA Act of 2002.
• The directorate has to recommend and process the cases for preventive undertaking and detention that come under the COFEPOSA (Conservation of Foreign Exchange and Prevention of Smuggling Activities Act) Act.
• Enforcement Directorate has to seek and provide mutual legal assistance from/to the contracting states with respect to the confiscation and attachments of proceeds of crime and also in respect of transfer of the accused person under the PMLA Act of 2002.