Rudraraju Srinivas Shah vs The Union Of India And 4 Others
2022 Latest Caselaw 3931 Tel

     THE HONOURABLE SRI JUSTICE K.LAKSHMAN

              WRIT PETITION No.28779 OF 2022

ORDER:

This Writ Petition is filed to declare the action of

respondents in depriving the privilege of the petitioner to

travel abroad, under the guise of pendency of FIR No.

RC03520200A0002 dated 16.04.2020 registered by 4th

respondent, as illegal and consequently direct the

respondents not to deprive him from the said privilege.

2. Heard Sri K.Raghavacharyulu, learned counsel for

the petitioner and Sri B.Harinath, learned counsel appearing

for 5th respondent - Bank, and Sri N.Nagendran, learned Spl.

Public Prosecutor for CBI appearing for 4th respondent and

Sri Namavarapu Rajeshwar Rao, learned Asst. Solicitor

General of India for respondent Nos.1 to 3. Perused the

record.

FACTS OF THE CASE:-

3. The petitioner herein is a Non-Executive Director of

M/s Kyori Oremin Limited (for short, 'the company') which

was importing and trading in coal. The said company has

availed certain credit facilities to the tune of Rs.28 Crores

from 5th respondent - Bank. The account of the said company

is classified as Non Performing Asset (NPA). 5th respondent -

Bank has filed a suit before the DRT, Hyderabad. 5th

respondent - Bank has also lodged a complaint with 4th

respondent - CBI alleging that the loan account of the said

company is a fraudulent one. The above said company had

submitted One Time Settlement (OTS) proposal with 5th

respondent - Bank and the same was also approved on

31.12.2019. Subsequently a revised OTS proposal dated

14.05.2020 was approved. The OTS amount was paid on

14.08.2020, the 5th respondent has issued even No Dues

Certificate and released the personal guarantees of the

petitioner. All original documents were returned. But 5th

respondent has issued LOC against the petitioner herein. The

petitioner herein is now intending to travel United States of

America and other countries for his business purpose from

29.07.2022 to 31.08.2022 and he also undertakes to return

to India. Earlier when the investigating agency, while

investigating a case in R.C.No.11 of 2018, dated 03.07.2018,

in respect of loan from Central Bank of India, did not permit

the petitioner herein to travel abroad, he approached this

Court by way of filing a writ petition vide W.P.No.9604 of

2019 and this Court passed interim order. Pursuant to the

said orders, the petitioner travelled abroad and returned to

India.

4. Learned counsel for the petitioner would submit that

while issuing LOC, 5th respondent has not followed the

guidelines issued by the Ministry of Home Affairs, from time

to time including the latest guidelines issued vide Office

Memorandum dated 22.02.2021 and it is abuse of process of

law. The right of the petitioner to travel abroad cannot be

deprived and it amounts to violation of Article 21 of the

Constitution of India. He has also placed reliance on several

judgments. The petitioner herein is now intending to travel

United States of America and other countries for his business

purpose from 29.07.2022 to 31.08.2022 and he also

undertakes to return to India. He has also purchased Air

Tickets. He is ready to give undertaking to return to India.

Due to pendency of LOC, the petitioner herein is not in a

position to travel abroad for the said purpose. He has also

placed reliance on several judgments. With the said

submissions, the petitioner sought to declare the LOC issued

against him as illegal.

5. Whereas, Sri N.Nagendran, learned Spl. Public

Prosecutor for CBI appearing for 4th respondent referring to

the counter, would submit that 5th respondent - Bank has

followed the guidelines issued by the Ministry of Home

Affairs, Union of India, including the guidelines dated

22.02.2021. There is already an FIR pending against the

petitioner herein for defrauding the bank and causing

wrongful loss. The petitioner has availed cash credit facility of

Rs.28 Crores from 5th respondent and the same was later

declared as NPA. It was found in the Forensic audit that the

company has not utilized the borrowed funds for the

intended purpose and diverted the funds for other

business/personal purpose. Investigation was completed in

R.C.02(A)/2020 of CBI/ACB/Hyderabad and charge sheet

was filed against the petitioner herein including three others

before the XXI Addl.Chief Metropolitan Magistrate and

Special Court for CBI Cases, Hyderabad vide SR No.1783 of

2021 and the same was taken objection and it is yet to be re-

submitted. There is every likelihood of the petitioner to flee

away to escape trial if permitted. The petitioner has to

approach the officer who ordered issuance of LOC and extend

LOC wrongly. Instead of doing so, he has filed the present

writ petition and therefore it is within the bank's right to

make a request to 2nd respondent to issue LOC against the

petitioner herein. There is no irregularity in it.

6. In view of the above said facts, this Court directed

the learned Special Public Prosecutor for CBI to submit

information with regard to violation of conditions imposed by

this Court in order dated 13.04.2019 in I.A.No.01 of 2019 in

W.P.No.9604 of 2019. On instructions, he has submitted that

the petitioner has cooperated with the Investigating Officer,

and the Investigating Officer on completion of investigation

laid charge sheet against the petitioner herein.

7. The petitioner is intending to travel United States of

America and other countries for his business purpose from

29.07.2022 to 31.08.2022 and he also undertakes to return

to India. In proof of the same, the petitioner has filed certain

documents. There is no dispute that the petitioner herein has

filed the above writ petition and there is interim order passed

and the said writ petition is pending and the said interim

order is subsisting as on today. Earlier he travelled abroad

pursuance to the interim orders passed by this Court and

returned to India. He has strictly complied with the

conditions imposed by this Court. There is no complaint

against the petitioner that he has violated the conditions

imposed by this Court. His family members are residents of

Hyderabad and they have been living in Hyderabad since 14

years. He is ready to give undertaking to return to India by

31.08.2022 and will inform the respondent Nos.1 to 5 about

his travel progress and address there. In proof of the same he

has also filed air tickets.

8. In Menaka Gandhi Vs. Union of India1, it was held

by the Apex Court that no person can be deprived of his right

to go abroad unless there is a law enabling the State to do so

and such law contains fair, reasonable and just procedure.

Paragraph No.5 of the said judgment is relevant and the

same is extracted below:-

Thus, no person can be deprived of his right to, go abroad unless there is a law made by the State prescribing the procedure for so depriving him and the deprivation is effected strictly in accordance with such

1978(1)SCC 248

procedure. It was for this reason, in order to comply with the requirement of Article 21, that Parliament enacted the Passports Act, 1967 for regulating the tight to go abroad. It is clear from the provisions of the Passports, Act, 1967 that is lays down the circumstances under which a passport may be issued or refused or cancelled or impounded and also prescribes a procedure for doing so, but the question is whether that is sufficient compliance with Article

21. Is the prescription of some sort of procedure enough or must the procedure comply with any particular requirements? Obviously, procedure cannot be arbitrary, unfair or unreasonable. This indeed was conceded by the learned Attorney General who with his usual candour frankly stated that it was not possible for him to contend that any procedure howsoever arbitrary, oppressive or unjust may be prescribed by the law.

Therefore, such a right to travel abroad cannot be deprived

except by just, fair and reasonable procedure.

9. Referring to the said principle and also the principles

laid down by the Apex Court in several other judgments,

considering the guidelines issued by the Union of India from

time to time, the Division Bench of High Court of Punjab and

Haryana at Chandigarh in Noor Paul Vs. Union of India2

(2022) SCC online P&H 1176

held that a right to travel abroad cannot be deprived except

by just, fair and reasonable procedure. Without

communicating the LOC to the subject of LOC, the

authorities cannot seek to enforce it as it would not have any

effect in law.

10. On examination of the facts therein, it had declared

that issuance of LOC against the petitioner therein, a

Guarantor to the loans, as illegal and set aside the LOC

issued against the petitioner therein.

11. It is also relevant to note that the Bank of India,

respondent therein, the Originator of the LOC had preferred

Spl.Leave to Appeal (c) No(s). 7733 of 2022 wherein the Apex

Court, vide order dated 05.05.2022 declined to stay the

operation of said judgment except for the direction in the

operative part of the order that the respondent Nos.1, 3 and 4

therein shall serve a copy of the LOC and also reasons for

issuing it to the persons against whom it is issued as soon as

possible after it is issued, and also provide a post - decisional

opportunity to him and those requirements shall be read into

the OMs issued by the respondents concerning the issuance

of LOCs. The Apex Court also granted stay of the direction for

payment of costs. The Apex Court however directed the

Originator and custodian to ensure that the petitioner therein

shall not be prevented from travelling abroad to pursue her

studies by reason of the LOC. However, the Apex Court has

also directed the respondent No.1/Writ Petitioner therein to

give an undertaking to the Court not to dispose of her assets

if any. She shall also keep the Bureau of Immigration

informed of the dates of her departure from and entry into

India.

12. As discussed supra, the Investigating Officer, CBI

has filed charge sheet against the petitioner and the same

was returned with some objections. On re-submission, it was

taken on file, on receipt of summons, the petitioner has to

appear before the said Court and cooperate.

13. It is also relevant to note that in supersession of its

earlier Office Memorandum/guidelines, the Government of

India, had issued guidelines vide Office Memorandum, dated

22.02.2021 with regard to issuance of LOC. In the said

guidelines, the details of the Officers who have to issue LOC

and other procedures were explained. As per the said

guidelines, the Chairman/Managing Directors/Chief

Executive of all Public Sector Banks can request for opening

an LOC to the Deputy Director, Bureau of Immigration (BOI)

custodian of the LOC for issuance of the LOC.

14. As per clause-6(J) of the Office Memorandum, dated

22.02.2021, the LOC opened shall remain in force until and

unless a deletion request is received by the BOI from the

Originator itself. No LOC shall be deleted automatically. The

Originating Agency must keep reviewing the LOCs opened at

its behest on quarterly and annual basis and has to submit

the proposals to delete the LOC, if any, immediately after

such a review. The BOI should contact the LOC Originators

through normal channels as well as through the online

portal. In all cases where the person against whom LOC has

been opened is no longer wanted by the Originating Agency

or by Competent Court, the LOC deletion request must be

conveyed to BOI immediately so that liberty of the individual

is not jeopardized. A guideline similar to that of the above

referred guideline is also there, in OM, dated 05.12.2017.

Therefore, the 1st respondent, Originating Agency, shall

review the said LOC.

15. In view of the above said guidelines and also law

laid down, coming to the case on hand as discussed supra,

the petitioner herein is Non-Executive Director of the

Borrower Company which cleared the loan by availing OTS.

No Dues Certificate was also issued. However, proceedings in

CBI Court are pending. CBI has to resubmit the charge sheet

and on receipt of summons, the petitioner has to appear.

16. In view of the above said discussion, this Court is

not inclined to declare the LOC issued against the petitioner

herein as illegal. However, as per the above said guidelines

dated 22.02.2021, the Originating Agency has to review the

said LOC on quarterly and annual basis but the 5th

respondent - Bank did not do the said exercise. Counter filed

by CBI is silent with regard to the same. It is not in dispute

that the petitioner herein is permanent resident of Hyderabad

and his family members are residing at Hyderabad only.

Earlier he has travelled abroad by obtaining orders from this

Court. There is no allegation against him that he has violated

the condition imposed by this Court. Now he is only seeking

permission to travel abroad for a period from 29.07.2022 to

31.08.2022 for business purpose. Therefore, this Court is

inclined to suspend the LOC issued against the petitioner

herein for a period from 29.07.2022 to 31.08.2022.

17. Considering the said principles and also in view of

the above said discussion, this Writ Petition is disposed of

with the following directions:-

i. LOC issued by 5th respondent against the petitioner is suspended for a period from 29.07.2022 to 31.08.2022.

ii. 5th respondent shall inform/communicate this order to 2nd respondent in terms of Office Memorandum, dated 22.02.2021.

iii. The petitioner shall inform to the respondent Nos.2 to 5 the address and other particulars with regard to his stay in United States of America (USA).

iv. The petitioner shall inform his arrival/departure to the respondent Nos.2 to 5 in terms of the said Office Memorandum, dated 22.02.2021.

v. The petitioner shall cooperate with the Investigating Agency including the Central Bureau of Investigation (CBI) by furnishing information/documents, if any, as sought by them.

vi. 5th respondent - Originating Agency shall review the LOC opened against the petitioner herein on quarterly and annual basis, submit proposals to delete LOC, if any, immediately after such a review in terms of the said Office Memorandum, dated 22.02.2021.

vii. The respondent Nos.2 to 5 are directed to comply with the guidelines issued by the Government of India vide Office Memorandum dated 22.02.2021.

viii. Liberty is granted to the respondents to take action against the petitioner herein for violation of any of the aforesaid conditions.

Miscellaneous Petitions, if any, pending, shall also stand closed.

__________________ K. LAKSHMAN, J Date:28.07.2022

Note: Issue copy today.

b/o.vvr.