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SUBRAMONIUM PRASAD
Utkarsh Goyel – Appellant
Versus
Union of India – Respondent
JUDGMENT (Oral)
1. The Petitioners have approached this Court challenging a Lookout Circular (LOC) issued against the Petitioners at the instance of Respondent No.3/Bank of Baroda.
2. The facts as stated in the counter affidavit filed by the Respondent No.3/Bank of Baroda at whose instance the LOC has been opened are that M/s Royal Industries FZ LLC availed of loan from UAE Branch of Respondent No.3. It is stated that the Petitioners are Promoters and Directors of M/s Royal Industries FZ LLC. It is stated that the Petitioners also stood guarantee for the loan availed by the said M/s Royal Industries. It is stated that the borrower did not pay the loan amount and the account of the borrower was classified as an NPA on 30.06.2016.
3. The counter affidavit filed by Respondent No.3 indicates that a complaint that a cheque had been issued for repayment of loan which was dishonoured and a Complaint No.2862/2017 was lodged at Al Raffa Police Station against the signatory of the cheque. The criminal complaint was transferred to Dubai Police Prosecution and thereafter to Dubai Court. The Criminal Court of Dubai convicted the signatory of the cheque and ordered two years of imprisonment. It is
Lookout Circulars cannot be issued solely based on non-payment of loans without serious criminal allegations; such actions infringe upon the fundamental right to travel under Article 21.
The central legal point established in the judgment is that the issuance and renewal of Look Out Circulars (LOC) must align with the legal provisions and principles outlined in the relevant Office Me....
Look Out Circulars must be justified by substantial evidence and cannot infringe on fundamental rights without clear, objective criteria.
The issuance of Look Out Circulars (LOCs) should be based on exceptional circumstances and a larger impact on the country's economy, and citizens should not be deprived of their liberty to travel abr....
Issuance of Look Out Circulars must be based on concrete evidence and cannot be justified solely by the default in loan repayment, as it violates fundamental rights without due process.
The central legal point established in the judgment is that the issuance of Look Out Circulars must be based on exceptional circumstances and must conform to constitutional standards, including the r....
Look Out Circulars must adhere strictly to legal frameworks and cannot deny fundamental rights without justifiable grounds.
The issuance and continuation of a Look-Out Circular must be justified by compelling reasons, specifically regarding flight risk or evading justice; lack of fresh evidence can render it arbitrary.
An LOC, which is a coercive measure to make a person surrender and consequentially interferes with his right of personal liberty and free movement, certainly has adverse civil consequences.
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