Calcutta High Court
Mahzabeen Khatoon vs Union Of India And Ors on 7 June, 2023
OD-7
ORDER SHEET
WPO/1234/2023
IN THE HIGH COURT AT CALCUTTA
Constitutional Writ Jurisdiction
ORIGINAL SIDE
MAHZABEEN KHATOON
VERSUS
UNION OF INDIA AND ORS.
BEFORE:
The Hon'ble JUSTICE SABYASACHI BHATTACHARYYA
Date : 7th June, 2023.
Appearance:
Mr. Abhrajit Mitra, Sr. Adv.
Mr. Nikunj Berlia, Adv.
Mr. Rachit Lakhmani, Adv.
...for the petitioner
Mr. Debashish Saha, Adv.
Mr. Shiv Mangal Singh, Adv.
Ms. Jahan Ara Kulsum, Adv.
Ms. Moriam Sanfui, Adv.
...for the respondents
Mr. S. Bera, Adv.
...for the UOI
The Court: The learned Senior Advocate appearing for the petitioner
contends that the petitioner was scheduled to leave for Haj on June 4, 2023,
but was prevented at the airport by the Immigration Authorities apparently
on the ground that an LOC (Lookout Circular) had been issued against her
at the behest of the respondent-bank.
It is submitted that despite the request of the petitioner, no specific
documents or information was given to the petitioner to indicate as to the
exact reason why she was restrained.
It is further submitted that the petitioner has annexed to the writ
petition all the details as to her flight to Madinah and back via Jeddah,
which are required to be traversed for the purpose of performing Haj. The
purpose of the visit is exclusively to perform such Haj rituals and, as such,
the petitioner has no chance of fleeing India.
It is further submitted that the detention of the petitioner without any
rhyme or reason by the authorities is patently illegal and de hors the law.
The learned Senior Advocate for the petitioner, in his usual fairness,
also cites a recent judgment of a coordinate Bench in Vishambhar Saran vs.
Bureau of Immigration and Ors., reported at Manu/WB/0692/2023, for the
purpose of reiterating that unless the high grounds as per the notification of
the concerned authorities are met, there cannot be any issuance of LOC.
Learned counsel appearing for the bank initially sought for an
adjournment today. However, in view of the extreme urgency that the last
Haj flight is to leave Calcutta by tomorrow according to the petitioner, such
prayer for adjournment is refused. It may be further noted that the
respondent-bank was informed yesterday by the petitioner that the matter
would be taken up for hearing out of turn today.
From the cited judgments of the Coordinate Bench, it is seen that vide
Office Memorandum dated October 4, 2018, the Deputy Director, BOI,
Ministry of Home Affairs was requested to include sub-paragraph (xiv) to
paragraph 8(b) of the Memorandum of October 27, 2010.
The Office Memorandum dated October 4, 2018, inter alia stated that
"(c) As per the amended Paragraph 8(j) (amended through MHA's OM
dated 05.12.2017),
'In exceptional cases, LOCs can be issued even in such
cases, as would not be covered by the guidelines above, whereby
departure of a person from India may be declined at the request
of any of the authorities mentioned in clause (b) of the above-
referred OM, if it appears to such authority based on inputs
received that the departure of such person is detrimental to the
sovereignty or security or integrity of India or that the same is
detrimental to the bilateral relations with any country or to the
strategic and/or economic interests of India or if such person is
allowed to leave, he may potentially indulged in an act of
terrorism or offences against the State and/or that such
departure ought not be permitted in the larger public interest at
any given point in time.'
(d) It is, therefore, clear that the guidelines enable LOCs against
persons who are fraudsters/persons who wish to take loans, willfully
default/launder money and then escape to foreign jurisdictions, since
such actions would not be in the economic interests of India, or in the
larger public interest.
2. Therefore, as suggested by CBI, MHA is requested to kindly amend
the OM dated 27.10.2010 and include in the list of authorities under
Paragraph 8(b) another category, as follows :
'(xiv) Chairman (State Bank of India)/Managing Directors and
Chief Executive Officers (MD & CEOs) of all other Public Sector Bank'."
It was observed by the said Coordinate Bench that the expression
'economic interest', which was a pre-requisite for issuance of an LOC,
cannot be read in isolation but must be read into the context in which it has
been used in the policy of 2010, as amended. It cannot be given a narrow
interpretation to mean and include the conduct of business between the
bank and the defaulter. It was further observed that in the absence of any
input that such borrower was likely to flee India and such departure would
disrupt or adversely affect the economy of the country or jeopardize the
bilateral business relationship and/or strategic relationship of India with
other countries, such request would not be made.
It is also seen from the relevant portion of the request of amendment
to the notification that such inputs as discussed above are necessary pre-
requisite for the purpose of issuance of the LOC at the behest of the author
of the request for such issuance.
Although the author of the present request has authority to do so
under the Notification, in the absence satisfaction of the necessary pre-
conditions regarding prior information that the petitioner is a willful
defaulter and is attempting to escape to foreign jurisdiction, which is
detrimental to the economic interest of India or in larger public interest, the
issuance of the LOC itself was suspect.
In any event, nothing has been produced by the bank to show that
there were sufficient inputs received that the departure of the petitioner is
detrimental to the sovereignty or security or integrity of India or that the
same is detrimental to the bilateral relations with any country and/or to the
strategic and/or economic interests of India. Nothing has also been shown
to indicate that if the petitioner is allowed to leave, the petitioner may
potentially indulge in the act of terrorism or offences against the State
and/or such departure ought not be permitted in the larger public interest
at any given point of time.
The tenor of the allegations against the petitioner by the bank is
merely that a company, in which she was a director till the year 2014 and
was the guarantor in respect of a loan taken by which, has been declared to
be a willful defaulter. Although the petitioner, in theory, may not avoid
liability to repay the loan as a guarantor, which is co-extensive with that of
the borrower, the existence of such doctrine in the statute book is not
sufficient to establish the high ground for issuance of an LOC, unless the
requisite pre-requisites as per the relevant Notification are fulfilled.
Otherwise, any and every act of willful default and/or other default in
payment of loan on the part of a borrower would be sufficient licence for the
authorities to restrain the personal liberty of all the directors and/or the
guarantors of the borrower-company and prevent them from exercising their
liberty to travel abroad.
Moreover, in the present case, the petitioner has clearly disclosed her
flight tickets and clearly intends to go abroad for the specific purpose of
performing Haj under the arrangements made for Haj pilgrims by the
government, which cannot be equated with fleeing the country to avoid her
financial liabilities.
In such view of the matter, there is little scope of sustaining the LOC
issued by the respondent authorities with regard to the petitioner.
Despite the bank's plea that the account concerned has been declared
to be a fraudulent account, the same, simpliciter, by the same logic as
indicated above, does not justify the issuance of a Look-Out Circular to
restrain the petitioner from leaving the country for any and every purpose
whatsoever.
Needless to say, at this juncture, the above findings are only tentative
for the purpose of deciding the petitioner's ad interim prayer.
All questions are kept open for being argued by both the parties at the
final hearing of the present writ petition.
However, the operation of the LOC issued against the petitioner shall
remain stayed till July 21, 2023 or until further order, whichever is earlier.
Such stay will operate subject to and on condition of the petitioner
furnishing an undertaking in Court tomorrow by way of an affidavit, when
the matter appears under the heading "To be Mentioned", where the
petitioner will disclose her entire whereabouts during her stay in Madinah
and nearby as well as all places which she shall traverse for the purpose of
travelling to and fro Madinah for the purpose of performing Haj. That apart,
the petitioner shall specifically undertake, that she will take the return flight
on or before July 17, 2023 positively and shall intimate about her return to
India to the respondent authority upon such return.
A copy of such undertaking shall be handed over in advance to the
respondent-bank for the bank to address on the same when the same is
filed tomorrow.
The respondents shall file their affidavit in opposition within four
weeks from date. Reply, if any, shall be filed within a week thereafter.
Liberty to the parties to mention for inclusion of the matter for hearing after
the time for filing affidavits is over.
(SABYASACHI BHATTACHARYYA, J.)
SP/
