Supreme Court to Rule on ED’s Legal Standing: Can a Central Agency Invoke Article 226? 

The Supreme Court has agreed to examine a significant constitutional question raised by the states of Kerala and Tamil Nadu: whether the Enforcement Directorate (ED), a central investigative agency, possesses the legal standing to directly file writ petitions under Article 226 of the Constitution. This challenge arose after the Kerala High Court upheld the ED’s right to approach it to stall a state-appointed inquiry commission investigating the agency’s conduct in a politically sensitive gold smuggling case. The core legal dispute centers on whether the ED is an independent “juristic person” with the capacity to sue or merely a department of the Central Government that must operate through it. The Court’s upcoming ruling will critically impact the operational autonomy of central agencies, define the boundaries of state and central powers, and set a major precedent for India’s federal structure.

Supreme Court to Rule on ED’s Legal Standing: Can a Central Agency Invoke Article 226? 

Table 1: Core Legal Positions in the Case 

The Supreme Court of India has stepped into a significant legal and federal fray, agreeing to examine a fundamental question: does the Enforcement Directorate (ED), the central government’s financial investigation agency, have the legal personality to directly approach High Courts for protection of its rights? 

On January 20, 2026, a bench comprising Justices Dipankar Datta and Satish Chandra Sharma issued notice on pleas filed by the governments of Kerala and Tamil Nadu. These states are challenging a Kerala High Court order that upheld the ED’s right—or locus standi—to file a writ petition under Article 226 of the Constitution. The Court’s eventual ruling will not only define the procedural powers of a powerful agency but also recalibrate the delicate balance of power between the Centre and the States. 

The Heart of the Legal Debate: What is a “Juristic Person”? 

At its core, this case hinges on a foundational legal concept: whether the ED qualifies as a “juristic person.” A juristic or legal person is an entity that, while not a human being (“natural person”), is recognized by law as having a distinct legal identity. This identity allows it to hold rights, be subject to duties, and perhaps most critically for this case, sue or be sued in its own name. Corporations are the most common example of juristic persons. 

The States argue vehemently that the ED falls short of this status. Kerala’s petition contends that while the ED is a statutory body created by laws like the Prevention of Money Laundering Act (PMLA), it is ultimately “only a department of the Central Government”. It asserts that not all statutory bodies are automatically “body corporates” with the power to sue. For that, a statute must explicitly confer such a character, which the PMLA does not do for the ED as an institution. 

The ED’s counter, which found favor with the Kerala High Court, is two-fold. First, it argues that as a statutory authority, it is entitled to seek writ jurisdiction. Second, and more specifically, it points to its officers. The High Court noted that a “Deputy Director of Enforcement is a statutory authority under the PML Act,” and in that individual capacity, such an officer unquestionably has the locus standi to file a writ petition to defend the lawful functioning of the agency. 

The Trigger: Kerala’s Gold Smuggling Case and the Controversial Inquiry Commission 

This abstract legal debate erupted from a politically charged investigation. The case originated in July 2020 with the seizure of 30 kilograms of gold, worth approximately ₹14.82 crores, at the Thiruvananthapuram airport. The gold was allegedly smuggled using the cover of “diplomatic baggage” for the UAE Consulate. The investigation soon expanded, revealing potential links to money laundering and unlawful activities, bringing the ED and the National Investigation Agency (NIA) into the fray. 

The political temperature soared when key accused, Swapna Suresh and Sandeep Nair, alleged that ED officials had coerced them into signing statements implicating Kerala’s Chief Minister, Pinarayi Vijayan, and other state leaders. 

In response, the Kerala government, on May 7, 2021, issued a notification to constitute a Justice V.K. Mohanan Commission of Inquiry. This commission, headed by a former High Court judge, was tasked with investigating whether central agencies like the ED were overreaching their jurisdiction and acting with political bias to falsely implicate the state’s political leadership. 

The ED moved swiftly against this move. A Deputy Director approached the Kerala High Court, arguing that a state government could not order an inquiry into the operations of a central investigating agency working under central laws. The agency contended this was a mala fide (in bad faith) act that violated federal principles and could derail ongoing criminal proceedings. A single-judge bench agreed and stayed the commission’s work in August 2021, a decision later upheld by a division bench in September 2025, leading the states to appeal to the Supreme Court. 

A Broader Federal Conflict: Tamil Nadu Joins the Fray 

Kerala is not alone in its constitutional challenge. Tamil Nadu has filed a separate petition, making the Supreme Court’s upcoming decision pivotal for multiple non-BJP governed states. 

Tamil Nadu’s grievance stems from the ED’s actions within its own jurisdiction. The state accuses the agency of a “gross and blatant abuse of the process of law” by invoking the writ jurisdiction of the Madras High Court. In one instance cited, the ED sought a mandamus (a judicial command) to force the registration of a case related to alleged illegal mining. For Tamil Nadu, this represents an overreach where a central agency is using constitutional writs to intervene in what it perceives as state matters. 

This alliance between Kerala and Tamil Nadu underscores that the case is more than a one-off dispute; it is a symptom of escalating tensions in India’s federal structure. States are increasingly challenging the methods and perceived political motivations of central agencies, setting the stage for a landmark ruling that will define the boundaries of their operational autonomy. 

The Stakes: Why This Supreme Court Decision Matters 

The Supreme Court’s examination goes beyond a technicality of legal procedure. Its verdict will have profound implications: 

• Power of Central Agencies: A ruling in favor of the ED would solidify its independent legal identity, empowering it to directly and swiftly approach High Courts across India to challenge state actions it deems obstructive. This would significantly enhance its operational agility. 

• State Sovereignty and Federalism: A ruling in favor of the states would reaffirm the limits of central agencies’ powers, emphasizing that they function as part of the central executive. It could force the Centre itself to become a party to such disputes under Article 131, making interstate legal battles more formal and politically weightier. 

• Ongoing Investigations: The immediate fate of the Justice Mohanan Commission in Kerala hangs in the balance. If the Supreme Court allows the ED’s writ petition to stand, the commission will likely remain stayed, affecting a politically sensitive investigation into the agency’s own conduct. 

• A Pattern of Action: The context makes this case even more consequential. The Supreme Court’s notice coincided with ED conducting widespread raids at 21 locations across Kerala, Tamil Nadu, and Karnataka in the separate but politically sensitive Sabarimala gold loss case. Kerala’s Ports Minister, V.N. Vasavan, called these raids “politically motivated,” highlighting the deep distrust that frames this legal battle. 

Looking Ahead: A Defining Moment for Federal Jurisprudence 

As the Supreme Court prepares to hear this case in the coming weeks, it faces a delicate task. It must interpret the “interplay” between Article 131 and Article 226, as framed by Senior Advocate Kapil Sibal for Kerala, and apply precedents like the Chief Conservator of Forests case which dealt with the legal capacity of entities to sue. 

The outcome will set a precedent not just for the ED, but potentially for all central investigative and regulatory agencies. It will determine whether they can litigate as independent legal entities or must function as arms of the Union government in legal conflicts with states. In doing so, the Supreme Court will deliver a judgment that either reinforces the centralizing trends in India’s federalism or reaffirms the constitutional autonomy of the states, marking a pivotal chapter in the nation’s ongoing constitutional dialogue.