Context:

• In June 2025, the Enforcement Directorate (ED) issued summons to senior advocates, including Arvind Datar and Pratap Venugopal, in connection with legal advice rendered in a corporate matter involving employee stock ownership plans (ESOP).
  • ESOP is an employee benefit that gives workers ownership interest in the company in the form of shares of stock.
• The incident triggered alarm within India’s legal fraternity, raising deep concerns over the independence of legal professionals, the sanctity of advocate-client privilege, and the overreach of investigative agencies.

The ED Summons - A Flashpoint:

• Summons to senior advocates:
  • The ED summoned senior advocates over opinions given in their professional capacity to Care Health Insurance regarding the ESOPs issued by Religare.
  • Arvind Datar’s summons was later withdrawn after widespread protest; another followed for Pratap Venugopal.
• Legal fraternity's reaction:
  • Strong condemnation from bar associations, viewing it as executive overreach.
  • Seen not as a one-off event, but as a broader threat to professional autonomy and legal integrity.

The Legal Core - Advocate-Client Privilege:

• Bharatiya Sakshya Adhiniyam (BSA), 2023:
  • It replaces the Indian Evidence Act, 1872.
  • Section 132 of the BSA: Protects communications between lawyers and clients unless consent is given.
  • In the above case, there is no evidence of lawyer complicity or inducement, rendering the summons baseless.
• Advocates Act, 1961 – Professional duty:
  • Bar Council Rules (under the Act) mandate impartial, fearless legal advice.
  • Legal privilege ensures that lawyers can fulfil their duty without coercion.

Implications for Rule of Law and Constitutional Democracy:

• Undermining legal independence:
  • Legal counsel summoned without allegation of wrongdoing disrupts the institutional balance between Bar, Bench, and Executive.
  • Sets a dangerous precedent — today senior advocates in a corporate context are targeted, tomorrow criminal defence or constitutional litigation lawyers can be targeted.
• Impact on legal practice:
  • Psychological impact: Lawyers may fear advising on sensitive cases.
  • Self-censorship: Risk-averse behaviour and decline in candid legal opinions.
  • Erosion of public interest litigation and constitutional advocacy.
• Chilling effect:
  • A move from independent legal counsel to a silenced or pliant
  • The damage to democratic institutions may be long-term and structural.

Urgent Need for Institutional Safeguards:

• Judicial clarification: The judiciary must issue a declaratory ruling asserting that -
  • Lawyers cannot be summoned merely for professional advice, without evidence of unlawful complicity.
  • Legal counsel is a protected expression and its downstream use does not make the adviser an accomplice. This is implicit in the constitutional architecture.
• Role of Bar Councils: Must proactively -
  • Defend professional privilege.
  • Engage with investigative bodies to set boundaries.
• Parliamentary reform:
  • Enact statutory protections reinforcing the inviolability of legal counsel.
  • Prevent the misuse of laws like the Prevention of Money Laundering Act (PMLA, 2002) against lawyers.

Conclusion - Drawing the Constitutional Line:

• The ED’s actions, though partially retracted, reflect a troubling tendency toward executive encroachment on legal independence.
• If lawyers fear their own words may be weaponized against them, the entire justice system is at risk.
• A clear, constitutional, and unambiguous reaffirmation of legal privilege and professional autonomy is necessary — not just to protect lawyers, but to safeguard the rule of law itself.