O R D E R

% 20.08.2024

1. The present petition seeks quashing of the Look Out Circular1 issued at the instance of Respondent No. 4/ Indian Overseas Bank against the Petitioner.

2. Mr. Saurabh Kirpal, Senior counsel for the Petitioner, puts forth the following contentions:

2.1. The Petitioner is a reputable professional who has worked with various Corporates over the last 40 years of his professional career including

1 “LOC/ Impugned LOC”

W.P.(C) 9247/2019 Page 1 of 10 Hyderabad Industries Ltd.; HMV; and Super Cassettes Ltd. The Petitioner has earned a credible reputation as a professional for himself through the years, which is now in jeopardy because of the Impugned LOC.

2.2. The Petitioner is married and has three grown children, each of whom live abroad. The Petitioner was scheduled to travel to Canada on 21st August, 2019 late night/22nd August, 2019. After checking in at the Delhi International Airport, the Petitioner was stopped at Immigration and was informed of the said LOC which had been issued against him and the immigration stamp was cancelled ‘without prejudice’ on the Petitioner’s passport. Petitioner thereafter learnt that Respondent No.4/Respondent Bank had sought issuance of LOC against him vide letters dated 9th October, 2018 and 27th December, 2018 in relation to the financial default of M/s Frost International Limited2 and its group companies, Globiz Exim Pvt Ltd and Olympic Oil Industries Ltd.

2.3. The Petitioner has been employed with FIL as the President of HR & Administration since December 2007 and has held the position of President- Administration since 2014. The Petitioner is neither a Director of FIL nor a shareholder of FIL. Although the Petitioner holds a minority shareholding of 50,000 shares in M/s Olympic Oil Industries Ltd, the Petitioner bears no responsibility for the Non-Performing Assets3 status of the accounts of FIL, Globiz Exim Pvt Ltd, or Olympic Oil Industries Ltd. Furthermore, the Petitioner is not a guarantor for any of these entities. The Petitioner served merely as an Independent Director for Globiz Exim Pvt Ltd and Olympic Oil Industries Ltd, a fact duly communicated to the Respondent Bank. Thus, 2 “FIL”

3 “NPA”

W.P.(C) 9247/2019 Page 2 of 10 there is no basis in law for issuance of LOC against the Petitioner. The same is violative of the Petitioner’s fundamental right under article 14, 19(1)(g) and 19 of the Constitution of India,4 which includes the right to have a passport, the right to travel, the right to reputation and the right to carry on in his profession.

3. Per contra, counsel for Respondent No. 4 contends as follows:

3.1 It is not as if FIL alone enjoyed credit facilities from Respondent Bank. Globiz Exim Pvt and Olympic Oil and Industries Limited, group companies of FIL, were also involved; they availed credit facilities, and defaulted leading to their accounts being declared as NPAs. In these group companies, the Petitioner serves as an independent director and is also a shareholder. The Bank has filed recovery applications before the Debts Recovery Tribunal, Allahabad, seeking over INR 1000 crore, with the total debt owed by the Petitioner and its allies exceeding INR 4000 crore. The Respondent Bank has also initiated recovery proceedings under the SARFAESI Act, 2002, against the companies, individual guarantors, and corporate guarantors. Notably, both entities where the Petitioner serves as a director have provided corporate guarantees for FIL’s loan account. Apart from Respondent Bank, the aforesaid companies also availed various credit facilities from other 14 banks under the consortium financing. The Bank of India has also initiated proceedings against the afore noted entities before Debts Recovery Tribunal, Allahabad and National Company Law Tribunal. The total outstanding dues owed by the companies to all consortium member banks exceed INR 4,000 crore, which has been fraudulently misappropriated and diverted by the companies’ directors, as revealed by the forensic audit

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