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Understanding the process of issuing LOCs

The Supreme Court of India

The Supreme Court of India | Photo Credit: Getty Images/iStockphoto

The story so far: On April 5, the Punjab and Haryana High Court while quashing a Look Out Circular (LOC) against petitioner Noor Paul passed omnibus instructions to the respondents including the Ministry of Home Affairs (MHA) and the Bureau of Immigration (BOI) to serve a copy of the LOC to the affected person, state the reasons for issuing the LOC “as soon as possible” and provide a “post-decisional opportunity”. It asked the MHA to include these directions into the “Official Memorandum” or the guidelines that govern the opening of LOCs. The Government of India moved Supreme Court and the apex court stayed the particular paragraph of the High Court order. The High Court in its judgement has said that the action of the Bank of India to issue an LOC against Ms. Paul who was a guarantor to a loan procured by her father was “arbitrary, illegal and violative of Article 21 of the Constitution.” Ms. Paul got to know about the LOC when she was turned away from the Delhi airport on February 22 when she was there to travel to Dubai.

THE GIST
On April 5, the Punjab and Haryana High Court passed omnibus instructions to the Ministry of Home Affairs (MHA) and the Bureau of Immigration (BOI) to serve a copy of an issued LOC to the affected person, state the reasons for issuing the LOC and provide a “post-decisional opportunity”. The Supreme Court however, stayed this particular paragraph of the High Court order.
After several businessmen fled the country after defaulting on loans, the MHA in 2018 brought changes to the 2010 guidelines authorising executives of all public sector banks to generate LOCs against persons who could be detrimental to economic interests of the country.
Many citizens have moved courts to get the LOC quashed.

What is a look out circular?

It is a notice to stop any individual wanted by the police, investigating agency or even a bank from leaving or entering the country through designated land, air and sea ports. The immigration is tasked to stop any such individual against whom such a notice exists from leaving or entering the country. There are 86 immigration check posts across the country.

Who can issue LOCs?

A large number of agencies which includes the Central Bureau of Investigation (CBI), Enforcement Directorate, Directorate of Revenue Intelligence (DRI), Income Tax, State police and intelligence agencies are authorised to generate LOCs. The officer should not be below the rank of a district magistrate or superintendent of police or a deputy secretary in the Union Government.

What are the details required to generate an LOC and who issues it?

According to a 2010 official memorandum of the Ministry, details such as First Information Report (FIR) number, court case number are to be mandatorily provided with name, passport number and other details. The BOI under the MHA is only the executing agency. They generate LOCs based on requests by different agencies. Since immigration posts are manned by the BOI officials they are the first responders to execute LOCs by stopping or detaining or informing about an individual to the issuing agency. The LOCs can be modified; deleted or withdrawn only at the request of the originator. Further, the legal liability of the action taken by immigration authorities in pursuance of LOC rests with the originating agency.

How are banks authorised?

After several businessmen including liquor baron Vijay Mallya, businessmen Nirav Modi and Mehul Choksi fled the country after defaulting on loans, the MHA in 2018 brought changes to the 2010 guidelines authorising the chairman, managing director and chief executives of all public sector banks to generate LOCs against persons who could be detrimental to economic interests of the country. Though an LOC generated by the CBI on October 16, 2015 to “detain” Mr. Mallya existed based on the preliminary enquiry in a ₹900 crore loan default case, it was downgraded to “inform only” on November 23, 2015 as there was no FIR yet against him. Mr. Mallya who was a Rajya Sabha member then was a frequent flyer and he fled to the U.K in March 2016. The Ministry recently told the Delhi High Court that banks were authorised to generate LOCs as “in the recent past there have been incidents where the willful defaulters or economic offenders of public financial institutions have left the country after usurping public money or defrauding such public financial institutions.”

Is there any other clause under which an individual can be stopped?

The 2010 Ministry guidelines give sweeping powers to police and intelligence agencies to generate LOCs in “exceptional cases” without keying in complete parameters or case details against “suspects, terrorists, anti-national elements, etc, in larger national interest.” In 2015, Greenpeace activist Priya Pillai was stopped from travelling to London on a request by the Intelligence Bureau (IB) based on the “etc” provision in the 2010 order. The LOC was later quashed by the Delhi High Court. After the special status of J&K under Article 370 of the Constitution was read down by the Parliament in August 2019, LOCs were opened against several politicians, human rights activists, journalists and social activists to bar them from flying out of the country. The number of persons and the crime for which they have been placed under the list is unknown.

Are individuals entitled to any remedial measures?

Many citizens have moved courts to get the LOC quashed. The MHA has asserted that “LOCs cannot be shown to the subject” at the time of detention nor can any prior intimation be provided. The Ministry recently informed the Punjab and Haryana High Court that the LOC guidelines are a secret document and the same cannot be shared with the ‘accused’ or any unauthorised stakeholder; it cannot be provided or shown to the subject at the time of detention by the BOI since it defeats the purpose of LOC and no accused or subject of LOC can be provided any opportunity of hearing before the issuance of the LOC.

On January 12, a Delhi High Court bench led by Justice Rekha Palli had quashed an LOC against a Delhi businessman Vikas Chaudhary generated at the instance of the Income Tax department. The court said “no proceedings under any penal law had been initiated against the petitioner” and the LOC was “wholly unsustainable.” A Delhi court on April 8 while quashing an LOC against Aakar Patel, chair, Amnesty International India said that “there cannot be any unfettered control or restriction on the right to travel” and that it was part of the fundamental rights and asked the Director of the CBI to tender a written apology. As per norms, an LOC will stay valid for a maximum period of 12 months and if there is no fresh request from the agency then it will not be automatically revived.  


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Printable version | May 23, 2022 5:28:24 pm | https://www.thehindu.com/news/national/understanding-the-process-of-issuing-locs/article65446798.ece