Mrs. Leena Rakesh vs Bureau Of Immigration
2022 Latest Caselaw 9140 Kant

     IN THE HIGH COURT OF KARNATAKA AT BENGALURU

         DATED THIS THE 20TH DAY OF JUNE, 2022

                        BEFORE

          THE HON'BLE MR.JUSTICE S.G.PANDIT

         WRIT PETITION NO.11213/2022 (GM-PASS)

BETWEEN:

MRS. LEENA RAKESH
AGED ABOUT 43 YEARS
R/AT 1126, SERENDRA 2
MCKINLEY PARKWAY
MANILA-1634
PHILIPPINES

ALSO NOW AT
NO.312, 1ST MAIN,
NAGAPPA BLOCK
OPP: HP PETROL BUNK
ABBIGERE
CHIKKABANAVARA POST
BANGALORE-560090.
                                             ...PETITIONER

(BY SRI SHASHIKIRAN SHETTY, SR.COUNSEL A/W
 SMT. LATHA S SHETTY, ADV.)

AND:


1.    BUREAU OF IMMIGRATION
      MINISTRY OF HOME AFFAIRS
      GOVERNMENT OF INDIA
      REPRESENTED BY ITS COMMISSIONER
      (IMMIGRATION)
                           2

     EAST BLOCK-VIII, LEVEL-V, SECTOR-1
     R.K.PURAM, NEW DELHI-110066.
2.   FOREGIN REGIONAL REGISTRATION OFFICER
     (FRRO), BANGALORE
     BUREAU OF IMMIGRATION
     MINISTRY OF HOME AFFAIRS
     GOVERNMENT OF INDIA
     5TH FLOOR, 'A' BLOCK, TTMC
     BMTC BUS STAND BUILDING
     K.H.ROAD, SHANTINAGAR
     BANGALORE-560027.

3.   THE BANK MANAGER
     UCO BANK, NO.47,
     MM ROAD, KANNASA BUILDING
     FRASER TOWN-0624 BRANCH
     FRASER TOWN
     BANGALORE-560005.

4.   MR.RAKESH KUMAR DEVENDRAN
     AGED MAJOR
     S/O DEVENDRAN P
     NO.FLAT NO.G-101
     SINDHU KUTEERA
     4TH A CROSS, 4TH C MAIN
     BHUVANAGIRI OFF, OMBR LAYOUT
     BANASWADI ROAD
     BANGALORE-560043.
                                        ...RESPONDENTS

(BY SRI SHANTHI BHUSHAN H, CGC FOR R1 & R2
 SRI K.R.PARASHURAM, ADV. FOR R3)

     THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND
227 OF THE CONSTITUTION OF INDIA PRAYING TO DECLARE
THAT THE ACTIONS OF THE RESPONDENTS IN ISSUING AN
ENDORSEMENT OF CANCELLATION IN PASSPORT OF THE
PETITIONER DATED 05.06.2022 BY R2 AND NOT PERMITTING
THE PETITIONER TO TRAVEL FROM BENGLAURU TO
                                3

PHILIPPINES ANNEXURE-A IS HIGHLY ARBITRARY, ILLEGAL AND
WITHOUT AUTHORITY OF LAW AND IS IN VIOLATION OF
ARTICLE 14, 19 AND 21 OF THE CONSTITUTION OF INDIA AND
ETC.

    THIS PETITION COMING ON FOR ORDERS THIS DAY, THE
COURT MADE THE FOLLOWING:-

                          ORDER

Petitioner is before this Court under Article 226 of the

Constitution of India, praying for a writ of mandamus or

appropriate writ or direction, declaring that the actions of the

respondents in issuing an endorsement of cancellation on the

passport of the petitioner by respondent No.2 and not

permitting the petitioner to travel from Bengaluru to

Philippines as highly arbitrary, illegal and without authority

of law; for a writ of mandamus or any other appropriate writ

or direction, declaring that the actions of respondent Nos.1

and 2 in preventing the petitioner from traveling out of

Country on work as highly arbitrary, illegal and violation of

Articles 14, 19 and 21 of the Constitution of India.

2. Heard learned Senior Counsel Sri.Shashikiran Shetty

for Smt.Latha S Shetty, learned counsel for the petitioner;

learned Assistant Solicitor General Sri.Shanthi Bhushan for

respondent Nos.1 and 2 and Sri.Parashuram, learned counsel

for respondent No.3.

3. Learned Senior counsel for the petitioner would submit

that petitioner along with her husband had obtained loan

from the 3rd respondent-Bank on 19.12.2014. The property

which is offered as security to the loan obtained by them

stands in joint name of the petitioner as well as her husband

Mr.Rakesh Kumar. It is submitted that the petitioner and her

husband are due in a sum of Rs.66,11,868/- as on

13.06.2022. It is also submitted that the petitioner and her

husband had not paid the installments from September 2019

to the 3rd respondent-Bank. The reason for not repaying the

loan is that, due to differences between the petitioner and her

husband, they are before the Family Court in

M.C.No.5079/2019 praying for a judgment and decree to

dissolve their marriage.

4. Learned Senior Counsel would further submit that, to

tender her evidence in the pending divorce proceedings, the

petitioner came down to India on 01.06.2022; on 02.06.2022,

the petitioner tendered her evidence in the Matrimonial

proceedings and on 05.06.2022, she was to travel back to

Philippines where she is working. It is submitted that the

petitioner had come to India leaving her two minor children

aged about 10 and 8 years at Philippines. The petitioner was

to leave India on 05.06.2022, but she was prevented from

leaving the Country by the first respondent, putting

cancellation seal on her passport and she was prevented from

traveling to abroad at the request of the 3rd respondent-Bank.

The first respondent issued Look out Circular (for short

"LOC") against the petitioner.

5. Learned Senior Counsel Sri.Shashikiran Shetty would

submit that action of the respondents in preventing the

petitioner from traveling outside the Country is in violation of

Articles 14, 19 and 21 of the Constitution of India. It is

submitted that the 3rd respondent could not have requested

for issuance of LOC as the issuance of LOC is not a recovery

proceedings. It is submitted that the 3rd respondent has

initiated recovery proceedings and has brought the property

offered as security for sale, to realize the dues from the

petitioner and her husband. It is submitted that the property

was brought to sale on three occasions and the 3rd

respondent-Bank could not realize the amount due. Learned

Senior Counsel would submit that the value of the property,

according to the valuation of the 3rd respondent-Bank is

around Rs.75,00,000/- whereas the market value of the

property is nearly Rs.1,00,00,000/-. Thus, he submits that

when security is available, the 3rd respondent-Bank could not

have resorted to request for issuance of LOC, so as to recover

the amount from the petitioner. It is further submitted that

the 3rd respondent-Bank has not made any effort to recover

the amount from the husband of the petitioner.

6. Learned Senior Counsel would submit that LOC is

requested by the 3rd respondent-Bank in terms of the Official

Memorandum (for short "OM") dated 4th October 2010, which

is revised from time to time. He submits that neither criminal

case nor cognizable offence is registered against the

petitioner. LOC could be issued in such cases, only if the

authorities come to the conclusion that if a person is

permitted to travel outside the Country, the economic interest

of the Country would be affected. It is submitted that in the

present case, when the security of the property is more than

the value of the amount due, which is nearly Rs.66,11,868/-,

the same would have no effect on the economic interest of the

Country. Thus, learned Senior counsel relying upon the

decision of the Division Bench of Punjab and Haryana High

Court at Chandigarh contended that quantum of the alleged

default by the borrower by itself cannot be the basis for

seeking issuance of an extreme process like an LOC for

restricting the personal liberty of the petitioner to travel

outside the Country. Thus, he prays for allowing the writ

petition.

7. Learned Assistant Solicitor General Sri.Shanthi

Bhushan appearing for respondent Nos.1 and 2 would submit

that LOC was issued and the petitioner was prevented from

traveling outside the Country at the request of 3rd

respondent-Bank. Further, he would invite attention of this

Court to O.M. dated 04.10.2016 produced along with

statement of objections by respondent No.3 that wherever

respondent-Bank is of the opinion that fraudsters/persons

who wish to take loans, willfully default and then escape to

foreign jurisdictions to avoid paying back, against such

persons, request could be made to issue LOC and such

persons could be restricted from traveling outside the

Country. Thus, it is submitted that the whenever the Bank

requests on the ground that it would not be in a possession to

recover the money, if a person is permitted to travel outside,

respondent Nos.1 and 2 would take action to issue LOC.

Learned Assistant Solicitor General placing reliance on the

judgment of this Court in W.A.No.315/2021 disposed of on

12.05.2021 (Dr.Bavaguthuraghuram Shetty V/S Bureau of

Immigration and Others) contends that there need not be

any criminal case registered to issue LOC, but it could be

issued at Bank's request, if the Bank is of the opinion that if

the borrower is permitted to leave the Country it would not be

in a position to recover the dues, by which it would have

adverse impact on the economic interest of the Country.

8. Learned counsel for 3rd respondent-Bank

Sri.Parashuram would submit that the petitioner along with

her husband obtained loan from the 3rd respondent-Bank and

when they failed to repay the dues, the 3rd respondent-Bank

initiated recovery proceedings under the provisions of

Securitisation and Reconstruction of Financial Assets and

Enforcement of Security Interest Act, 2002 (for short

"SARFAESI Act"). Further, he submits that even after 3

occasions, the property is not sold. Further, learned counsel

would submit that the petitioner inducted tenants by

receiving Rs.22,00,000/- and the tenants have filed

O.S.No.25401/2021 making the Bank as one of the parties.

It is the main contention of the respondent-Bank that

because of induction of tenant in the secured property, Bank

could not sell the property, even after the property is brought

to sale on 3 occasions. Further, learned counsel would

submit that the security offered for Bank is the Apartment,

which is valued at Rs.68,00,000/- according to the Bank. It

is the submission of the learned counsel for the respondent-

Bank that if the petitioner is permitted to leave the Country,

they will not be able to recover outstanding dues. It is

submitted that the petitioner along with her husband is due

in a sum of Rs.66,11,868/- as on 13.06.2022. Further,

learned counsel would submit that 3rd respondent-Bank is

authorized to request respondent Nos.1 and 2 for issuance of

LOC wherever there is fraud and wherever the Bank is of the

opinion that the loanee would leave the Country to avoid

repayment of loan. Thus, it is submitted that in the financial

interest of the respondent-Bank, the Bank requested for

issuance of LOC. Thus, he prays for dismissal of the writ

petition.

9. Having heard the learned counsel for the parties and on

perusal of the writ petition papers, the only point that falls for

consideration is as to whether the respondent-Bank is

justified in requesting respondent Nos.1 and 2 to prevent the

petitioner from travelling outside the Country and to issue

LOC against the petitioner.

10. Answer to the above point in the facts of the case would

be in the negative for the following reasons:

It is an admitted fact that the petitioner and her

husband obtained loan of Rs.62,00,000/- from the 3rd

respondent-Bank for purchase of Apartment on 19.12.2014.

It is also an admitted fact that the petitioner as well as her

husband are due in a sum of Rs.66,11,868/- as on

13.06.2022. It is also to be noted that the 3rd respondent-

Bank has initiated recovery action under the provisions of

SARFAESI Act and it brought the secured property for sale

and no buyers have come forward to buy the secured

property.

11. The petitioner who is working at Philippines to eke out

her livelihood, had come to India to tender her evidence in the

matrimonial case pending between the petitioner and her

husband. The petitioner tendered her evidence before the

Family Court on 02.06.2022, when the petitioner was to leave

on 05.06.2022 from India to Philippines, the petitioner was

prevented from leaving the Country and cancellation seal was

put on her passport and at the request of the 3rd respondent-

Bank, LOC was issued against the petitioner.

12. LOC could be issued in terms of O.M. dated 22.02.2021.

No one has absolute right to travel abroad or in other words,

a person's right could be curtailed by following the procedure

prescribed thereunder. A person could be prevented from

traveling abroad or LOC could be issued only in terms of O.M.

dated 22.02.2021. The above stated O.M. permits issuance of

LOC against a person under various circumstances. In the

instant case, no criminal case is registered against the

petitioner nor any cognizable offence is alleged. Clause 6(L) of

the O.M. dated 22.02.2021 reads as follows:

"In exceptional cases, LOCs can be issued even in such cases as may 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) above. 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 stranger and/or economic interests of India or if such person is allowed to leave, he may potentially indulge 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 of time."

The above clause empowers the authority to issue LOC if it

comes to the conclusion that permitting a person to leave the

Country would have adverse impact on the economic interest

of India. In the case on hand, LOC admittedly is issued at the

instance of the 3rd respondent-Bank. The amount due from

the petitioner to 3rd respondent-Bank is Rs.66,11,868/- as

stated by the 3rd respondent-Bank in its statement of

objections as on 13.06.2022. The 3rd respondent-Bank has

not disclosed the value of the security held by it. Learned

counsel, during the course of his submission has stated that

the value of security held by the Bank is around

Rs.68,00,000/-. But, nowhere in the statement of objections

nor in the affidavit filed today, the 3rd respondent-Bank has

disclosed the value of the security. Non-disclosure of value of

the secured property itself would disclose the intention of the

Bank and the Court could draw adverse inference against the

respondent-Bank. At this juncture, submission of the

learned counsel for the petitioner that the value of the

property is more than Rs.75,00,000/- is to be believed.

Moreover, issuance of LOC or preventing a person from

traveling abroad cannot be a mode of recovery of dues by the

3rd respondent-Bank. The amount due by the petitioner to

the 3rd respondent-Bank in a sum of Rs.66,11,868/- would

have no impact or affect the economic interest of the Country,

more so, when the 3rd respondent is having security of value

of which is more than the amount due from the petitioner.

The contention of the 3rd respondent-Bank that, since the

petitioner inducted tenants, they are not in a position to sell

the secured asset is liable to be rejected for the reason that

the 3rd respondent-Bank is not remedy less. The provisions of

SARFAESI Act, 2022 safeguard the interest of the Bank and

provides mode of recovery of possession. The 3rd respondent-

Bank instead of following the recovery procedure prescribed

under SARFAESI Act is resorting to pressure tactics by

preventing the petitioner from traveling abroad where she is

working.

13. It is true that the respondent-Bank is conferred with the

power to request respondent Nos.1 and 2 to issue LOC

against a person who has committed fraud or default against

the Bank. It is for the Bank to take a decision as to, in which

case the Bank could request LOC. Just because power is

conferred to request issuance of LOC, such power cannot be

exercised arbitrarily. Bank has to take a conscious decision

by examining as to whether the petitioner's case falls within

the ambit of fraud or default which would affect economic

interest of the Country. In the instant case, value of the

secured property is more than the amount due from the

petitioner to the 3rd respondent-Bank. In that circumstance,

3rd respondent-Bank is not justified in requesting for issuance

of LOC. At the same time, respondent Nos.1 and 2 are also

not justified in issuing LOC for mere asking by the 3rd

respondent-Bank. Respondent Nos.1 and 2 under O.M.

dated 22.02.2021 are required to examine as to whether 3rd

respondent-Bank's request to issue LOC against the

petitioner would affect the economic interest of the Country.

Mere due of Rs.66,11,868/- cannot be the basis for seeking

issuance of LOC by 3rd respondent-Bank that too, restrict the

personal liberty of the petitioner to travel outside the Country.

The petitioner is not leaving the Country to avoid repayment

of loan of the Bank, but the petitioner is employed in

Philippines and she had come to India to tender her evidence

in a pending matrimonial case. The decision relied upon by

the learned Assistant Solicitor General on

Dr.Bavaguthuraghuram Shetty case would have no

application to the facts of the present case. In the said case,

the petitioner was due to the Bank in a sum of Rs.2800.00

Crores and the same would definitely affect the economic

interest of the Country. Thus, I am of the opinion that action

of the respondents is arbitrary, unreasonable and unfair in

the peculiar facts and circumstances of the case. Any action

of the State if it is arbitrary and unreasonable is liable to be

interfered.

14. For the reasons stated above, the writ petition is allowed

in part with the following directions:

(a) The petitioner is directed to deposit a sum of

Rs.10,00,000/- with the 3rd respondent-Bank, which could be

adjusted towards the dues and furnish a solvent surety to the

satisfaction of 3rd respondent-Bank;

(b) On deposit of Rs.10,00,000/- and on providing a

solvent surety by the petitioner, the 3rd respondent-Bank

shall forthwith request respondent Nos.1 and 2 to withdraw

the LOC and to permit the petitioner to travel outside the

Country.

Sd/-

JUDGE

mpk/-* CT:bms