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2024 Supreme(Online)(Kar) 44241
IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 31ST DAY OF AUGUST, 2024 BEFORE THE HON'BLE MR JUSTICE HEMANT CHANDANGOUDAR WRIT PETITION NO. 7927 OF 2023 (GM-RES)
BETWEEN:
1. SHRI C SHIVKUMAR REDDY AGED ABOUT 59 YEARS S/O C VEERA REDDY R/AT NO 14, RAMANASHREE
29TH MAIN ROAD BTM LAYOUT II STAGE BANGALORE 560 078.
2. SMT R H KASTURI AGED ABOUT 54 YEARS W/O C. SHIVAKUMAR REDDY R/T NO 14, RAMANASHREE
29TH MAIN ROAD BTM LAYOUT II STAGE BANGALORE 560 078.
3. MS C UMA REDDY AGED ABOUT 62 YEARS D/O C V REDDY, R/AT NO 31-36 Digitally signed by B K II FLOOR, 1ST MAIN ROAD MAHENDRAKUMAR
2ND STAGE, AREKERE MICO LAYOUT Location: HI GH COURT OF BANNERGHATTA ROAD KARNATAKA BANGALORE 560 076.
…PETITIONERS (BY SRI. SANDESH J CHOUTA, SENIOR COUNSEL FOR SRI. SAMPREETH V, ADVOCATE)
AND:
1. UNION OF INDIA BY MINISTRY OF HOME AFFAIRS JAI SINGH MARG, HANUMAN ROAD AREA CONNAUGHT PLACE, NEW DLEHI 110001 REPRESENTED BY ITS HOME SECRETARY.
2. BUREAU OF IMMIGRATION MNISTRY OF HOME AFFAIRS 5TH FLOOR, A BLOCK TTMC BMTC BUS STAND BUILDING K H ROAD, SHANTHI NAGAR BENGALURU 560 027.
3. BANK OF BARODA (PREVIOUSLY WAS DENA BANK) ZONAL OFFICE, VIJAYA TOWER NO 41/2, M G ROAD BANGALORE 560 001.
…RESPONDENTS (BY SRI. SHANTHI BHUSHAN H, DSGI FOR R1 & R2;
SRI. T P MUTHANNA, ADVOCATE FOR R3)
THIS WP IS FILED THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO DIRECTION TO THE RESPONDENTS TO PLACE THE IMPUGNED LOOK OUT CIRCULAR BEFORE THIS HONBLE COURT WHICH WAS PURPORTEDLY ISSUED BY RESPONDENT NO. 3 AS AGAINST THE PETITIONERS AND ETC.
THIS PETITION, COMING ON FOR ORDERS, THIS DAY, ORDER WAS MADE THEREIN AS UNDER:
CORAM: HON'BLE MR JUSTICE HEMANT CHANDANGOUDAR
ORAL ORDER
The petitioners herein challenge the Look-Out Circular (LOC)
issued by respondent No.1, at the instance of respondent No.3 - Bank of Baroda (formerly Dena Bank), which restrains them from travelling abroad. The petitioners seek a direction to serve a copy of the LOC or, alternatively, to direct the respondents to place the LOC on record and to issue a Writ of Certiorari to quash and set aside the LOC. The petition was filed on 06.04.2023.
2. The respondents are as follows: respondent No. 1 is the Ministry of Home Affairs, Union of India; respondent No. 2 is the Bureau of Immigration, Ministry of Home Affairs, Bengaluru; and respondent No. 3 is the creditor bank and the purported originator of the LOC.
3. Petitioners Nos. 1 and 2 are spouses and founders of Kaveri Telecom Products Ltd. (KTPL). Petitioner No. 3 is the sister of petitioner No. 1 and serves as an independent director on the board of KTPL. The company, a supplier of radio frequency products and antennas, was involved in the wireless applications sector for civilian, defence, and space industries until 2012.
4. The petitioners had availed loans totaling INR 75 crores from various banks between the years 2009 and 2011 for infrastructural development, which were fully repaid by the year
2018.
5. In December 2011, the petitioners were advanced another sum of INR 45 crores (referred to as "the said debt") by respondent No. 3 for the development of an Inbuilding Solutions (IBS) network. Due to the Supreme Court's cancellation of 122 cellular operators' licenses in the 2G Spectrum Scam and the overall downturn in the telecom sector due to policy paralysis, the IBS network did not achieve the expected adoption by cellular network operators.
6. As a result, the petitioners faced a financial crisis and were unable to fully service the said debt, having repaid only INR
16 crores by the time of preferring this petition.
7. The Central Bureau of Investigation (CBI) registered a case R.C. No. 10(E)/2017 on 27.07.2017, leading to the XVII Addl. Chief Metropolitan Magistrate (Special CBI Judge), Bengaluru, taking cognizance of offences under Sections 120B, 420, 468, and
471 of the IPC, and issuing summons in C.C. No. 11606/2020. 8. This case was stayed by this Court on 10.12.2020 in W.P. No. 14431/2020, wherein it was observed that since respondent No. 3 is a private commercial entity, the CBI could not register the case under the provisions of the Delhi Police Special Establishment Act. The CBI could not file a final report as no public servant was involved. The Court also noted that respondent No. 3 had pursued other proceedings before the Debt Recovery Tribunal (DRT) in O.A. 16/2015, including criminal proceedings to recover the dues.
9. Subsequently, the CBI issued a Look-Out Circular against the petitioners, leading to petitioner No. 2 being stopped from boarding a flight to the USA on 20.09.2018 by respondent No.
2.
10. The Look-Out Circular was quashed by this Court on
21.04.2021 in W.P. No. 51087/2019, with a direction to the petitioners to furnish surety for future appearances before the Trial Court, and to inform the Trial Court of their travel itinerary.
11. On 02.04.2023, while petitioners Nos. 1 and 2 were scheduled to travel to Bangkok and return on 05.04.2023, they were stopped by respondent No. 2 on the grounds that an LOC had been issued by respondent No. 1, but they were refused a copy as it was considered an internal document. Aggrieved, the petitioners have now filed the instant petition seeking to quash the LOC originated by respondent No. 3 - Bank of Baroda.
12. Senior Counsel Shri Sandesh J. Choutha, representing the petitioners, has made the following submissions:
12.1. Public sector banks cannot initiate requests for the issuance of LOCs by the Ministry of Home Affairs, as it is considered arbitrary and an excessive delegation of powers, restricting the fundamental right to travel.
12.2. Multiple LOCs cannot be issued by different authorities for the same inciden
