The Bombay High Court ruled that the right to travel abroad is part of personal liberty under Article 21 of the Constitution of India and quashed an LOC against a Pune resident issued by the Serious Fraud Investigation Office.
MUMBAI: The Bombay High Court has held that the right to travel abroad forms part of the right to personal liberty under Article 21 of the Constitution and cannot be curtailed by continuing a Look Out Circular (LOC) when there is no reasonable apprehension that the person concerned will evade investigation or abscond.
A Division Bench of Justice A. S. Gadkari and Justice Shyam C. Chandak allowed a writ petition by an elderly Pune resident and quashed the LOC issued against him by the Serious Fraud Investigation Office (SFIO).
The Court found that, absent any indication that the petitioner had attempted to evade investigation or abused the liberty granted by the court, maintaining the LOC was unnecessary and liable to be set aside.
Factual Backgrounds:
The petition was filed under Article 226 of the Constitution read with Section 482 of the Code of Criminal Procedure, seeking quashing of a LOC issued in connection with an SFIO probe under Section 212(1) of the Companies Act, 2013.
The probe concerned M/s ISMT Limited, where the petitioner had served on the board before resigning in March 2022. The petitioner said the company had successfully completed a debt resolution process and entered into a One Time Settlement with lenders, thereby discharging its liabilities.
Nevertheless, during the ongoing investigation a LOC was issued against him, which came to light when he was prevented from travelling abroad at Chhatrapati Shivaji Maharaj International Airport, Mumbai, on 18.04.2022.
The petitioner approached the High Court, arguing that the LOC was issued in breach of the Office Memorandum that governs issuance of such circulars and that it violated his fundamental rights. He maintained that he had cooperated with the investigation throughout and that the travel restriction had severely affected his ability to go abroad despite his close social and business ties in India.
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At the hearing, the petitioner’s counsel submitted that the investigating agency did not dispute the petitioner’s cooperation.
Observations of the Court:
The Court observed that while the writ petition was pending it had allowed the petitioner to travel abroad on certain occasions subject to conditions; on each occasion the petitioner complied and returned within the stipulated time, showing he had not misused the liberty granted. The petitioner also pointed out that he had never been arrested in relation to the investigation and had always responded when required by the investigating agency.
The prosecution relied on the SFIO investigation report, which allegedly indicated that the petitioner, as the company’s founder, failed to ensure that financial statements reflected a true and fair view. It was alleged he had approved financial statements despite being aware of serious financial concerns, potentially attracting liability under the Companies Act. The prosecution suggested that if the LOC were quashed, the Court should direct surrender of the petitioner’s passport and require prior permission from the trial court for any overseas travel.
Weighing the submissions, the Court found several material facts in the petitioner’s favour. It noted he was a permanent Pune resident with strong social and business roots in India and that the respondents had not disputed his cooperation with the probe. The bench also relied on the petitioner’s compliance with earlier court-granted travel permissions as evidence that there was no real risk of absconding if the LOC were lifted.
The petitioner’s advanced age was another important consideration. The Court recorded that he is 89 years old and wished to travel abroad to meet family and friends while his health permitted. In this context, the Court highlighted that the right to travel is an integral component of the right to personal liberty guaranteed under Article 21 of the Constitution. It observed that any unreasonable restriction on travel would adversely affect an individual’s quality of life and personal well-being.
The Court further noted that the petitioner had not been arrested during the investigation and that the investigating agency did not require his physical presence until trial proceedings commence. On these grounds, the bench concluded that the continued operation of the LOC was unwarranted.
Accordingly, the High Court quashed the Look Out Circular issued against the petitioner on 22.02.2021 and allowed the writ petition.
Case Title: Baldevraj Topan Ram Taneja v. Assistant Director, SFIO & Ors.
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