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.

ORDE R

1. The present petition has been filed seeking the quashing of the Look-Out Circular (LOC) issued against the petitioner.

2. The facts manifest that a FIR No. 218 of 2020 was registered on 16.12.2020 by the Economic Offences Wing, New Delhi, under Sections 406/420/120-B of the Indian Penal Code, 1860, against the petitioner and other co-accused. The FIR arose out of disputes pertaining to a Memorandum of Understanding (MoU) executed in 2013 between the complainant, i.e., Mr. Ashok Sachdev and his associates, and the petitioner’s husband in relation to investment in a real estate project titled “USHERA.” While an investment of Rs.35 crores was allegedly contemplated, only Rs.22.5 crores was made, which led to disputes between the parties. Apprehending arrest in FIR No. 218 of 2020, the petitioner applied for anticipatory bail and was granted the same vide order dated 06.08.2022 passed by the Additional Sessions Judge, Patiala House Courts. The ASJ, while granting anticipatory bail, recorded that no illegality or siphoning of funds was apparent and further noted that the project “Ushera” was substantially complete to the extent of 50–70%. It was also noted, based on submissions of the Investigating Officer, that no illegal fund transfer had been detected.

3. The petitioner submits that she has been cooperating with the investigation at all times. However, since the grant of anticipatory bail, the petitioner has not been called for investigation even once, a period now spanning over three years. The investigation is admittedly still pending, and no charge-sheet has been filed against the petitioner.

4. It is the case of the petitioner that the aforenoted FIR is one among a series of proceedings initiated by the complainant and his associates, most of which have either failed or been closed. These include FIR No. 253/2019 registered by the CCB, Chennai, proceedings under Section 7 of the Insolvency and Bankruptcy Code before the NCLT, which was dismissed on 18.01.2021 and affirmed by the NCLAT on 12.08.2024, and a complaint before the Serious Fraud Investigation Office (SFIO), which was closed on 11.03.2020 on the ground that the dispute was civil in nature.

5. The petitioner further submits that she became aware of the existence of the LOC only when she was informed by the Investigating Officer, which prevented her from travelling abroad, including to Australia in connection with her granddaughter’s medical condition. Despite repeated requests, the petitioner was neither furnished with the grounds nor the particulars on the basis of which the LOC was issued, and the same could not be obtained even under the Right to Information Act, 2005.

6. It is further submitted that the Status Report dated 21.11.2022 filed by the respondent itself records that the petitioner does not have any major role in the investigation. In these circumstances, the petitioner submits that the continuance of the LOC is wholly unjustified.

7. However, the Court, at this stage, is not concerned about the veracity of those allegations. The allegations in the FIR will have to be taken to their logical conclusion by the concerned police while undertaking the investigation. The Court is only concerned with the issue of the justification of LOC.

8. Before turning to the facts of the instant case, at the outset, it is pertinent to note the legal position as to when the Court shall exercise its discretion under Article 226 of the Constitution of India to quash the LOCs.

9. This Court in Vikram Sharma v. Union of India , 2010 SCC OnLine Del 2475 and Sumer Singh Salkan v. Asst. Director , 2010 SC