-BY ASHWARYA SINHA, ADVOCATE-ON-RECORD
Introduction
A Look-Out Circular (LOC) is an important legal tool used by law enforcement agencies in India to prevent an individual from leaving the country.
The primary objective of issuing a LOC is to alert immigration authorities, law enforcement agencies, and other relevant authorities about the movement of individuals who are suspected of committing a crime, or who are wanted by law enforcement for investigation or prosecution.
A Look Out Circular (LOC) can be described as a coercive measure employed by a State to control and regulate the physical movement of an individual.
Its primary purpose is to track, apprehend, and potentially detain a wanted person, ensuring they are handed over to the appropriate law enforcement authorities.
Once an LOC is issued, it becomes challenging for the individual to enter or exit the country, as the circular serves as a flag for their movements. LOCs are exclusively issued by the Bureau of Immigration (BOI), Ministry of Home Affairs,
though certain agencies are authorized to request their issuance.
LOCs are commonly used in India in cases of financial fraud, economic offences, and other criminal cases like
matrimonial abduction and money laundering, etc. It can be issued when there is a concern that the individual may abscond or obstruct legal proceedings.
Understanding the Purpose of LOCs in Legal Investigations
LOCs are typically issued against both Indian citizens and foreign nationals who are subjects of ongoing investigations. These individuals may have pending cases, and their presence is required to aid in the investigation process. The issuance of an LOC is a strategic tool to ensure that the person remains within jurisdictional reach, ensuring their cooperation in legal proceedings.
Look Out Circular Guidelines by MHA
LOC does not have express statutory backing in legislation and the same is governed by the Office Memorandums issued by the Ministry of Home Affairs (‘MHA’).
For the first time, in 1979, the Ministry of Home Affairs (MHA) issued an Office Memorandum (OM) on 05.09.1979, allowing the issuance of Look Out Circulars (LOCs) to monitor the travel of citizens banned from movement by authorities.
Only specific entities like the foreign ministry, customs, income tax, CBI, Interpol, and the police could issue LOCs, which were valid for one year.
In 2000, the MHA issued another OM on 27.12.2000, providing clearer administrative guidelines for issuing LOCs. This was challenged in the Delhi High Court in cases like Vikram Sharma v. UOI and Sumer Singh Salkan v. Asst. Director.
The court added conditions to prevent the misuse of LOCs, prompting the MHA to issue a more comprehensive OM on 27.10.2010.
The MHA amended the 2010 OM with a 2018 update, allowing SFIO officers to issue LOCs. The same year, the OM was further revised to grant Public Sector Bank officials the authority to issue LOCs.
This change became public through a press release on 24.07.2019, which clarified that bank officials could request LOCs for wilful loan defaulters or fugitive economic offenders.
The current LOC issuance procedure in India is mainly governed by the Office Memorandum issued by the MHA in 2021 vide Notification Number 25016/10/2017-Imm (Pt.) dated 22.02.2021 which provides consolidated guidelines for opening LOCs against Indian citizens or foreigners.
OM 2021 Guidelines:
- The originating agency can make a request to the Bureau of Immigration (BOI) to open an LOC.
- The request for opening LOCs can only be made by officers holding a prescribed rank.
- LOCs can also be opened as per directions of any Criminal Court in India. However, in such cases, the request shall be initiated by the local police or by any other law enforcement agencies.
- LOCs can only be opened in Cognizable offences under IPC or other penal laws, and the reason for opening the LOC must be indicated with the issue of the circular without which the subject of a LOC will not be arrested/detained.
- If there is no Cognizable offence pending, the LOC cannot be issued, and agencies can only request that they be informed of departure or arrival.
- LOCs cannot be issued unless a minimum of three identifying parameters are
available:
1. Name & Parentage
2. Passport Number
3. Date of Birth - The above guidelines provide that in exceptional cases, an LOC may be issued against an individual even when the case is not a criminal case. This is in specified circumstances, such as when it is detrimental to the “sovereignty, or security, or integrity of India”, the “bilateral relations with any State”, or to the “strategic and
economic interests of India”. - LOCs are also permitted in cases where the individual is likely to engage in terrorism or offences against the State or when such departure would not be “in the larger public interest”.
The Guidelines outlined above are more or less the reproduction of the 2010 OM, however, issuance of OM 2021 has brought one radical change in the 2010 OM.
Prior to OM 2021, LOCs were valid for a one-year period unless the originating agency makes a request for a renewal, and LOCs with more than one year shall be deemed to have lapsed unless renewed. However, it was not applicable if LOC is issued at the behest of Courts or Interpol.
The current OM 2021 Guidelines stipulate that that once an LOC is opened, it remains in effect until a deletion request is submitted by the originating agency to the BOI. The practice of automatic deletion of LOCs is no longer in place.
Recourse available to Person Against Whom LOC Is Issued:
- Approach the officer who ordered the issuance of LOC & explain that LOC was wrongly issued against him. The Originating Agency can propose the BOI to delete the LOC.
- Approach the trial court having jurisdiction over the concerned police station to prove the LOC was issued wrongly. The LOC can be rescinded by the concerned trial court.
- Challenge the LOC in the High Court under its writ jurisdiction, claiming it violates the fundamental right to travel and was issued without valid grounds.
It is a settled position of law that the Look Out Circular is a “coercive measure” and must only be used “sparingly” and not as a matter of course.
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Who Can Issue a Look Out Circular?
The following authorities can request or issue a LOC:
1. Local Police Authorities: In cases of criminal investigation or wanted suspects.
2. Central Investigation Agencies: Like the CBI or Enforcement Directorate (ED).
3. Customs and Income Tax Authorities: In financial crimes or cases involving tax
evasion.
4. Court Orders: Sometimes, the courts may direct authorities to issue a LOC if they believe an individual is attempting to evade legal proceedings. In such cases request for opening LOCs shall be initiated by the local police or any other law enforcement agencies.
Procedure for Issuance of a Look Out Circular
1. Filing of Complaint/Case: A complaint or FIR is filed against the person, detailing the crime they are involved in, or why they are wanted.
2. Request by Investigation Agency: The concerned investigation agency or law enforcement authority sends a request to the immigration or border authorities for the issuance of a LOC.
3. Verification and Authorization: The LOC is typically authorized by senior police officers or designated authorities based on the seriousness of the case, such as the Commissioner of Police or Director of the Enforcement Directorate.
4. Issuance of LOC: The LOC is sent to the immigration authorities at all ports of exit, airports, and relevant border areas to ensure that the individual is detained if they attempt to leave the country.
5. Execution: If the individual tries to board an aircraft, ship, or any other mode of transport, the authorities at the point of departure will stop them, often leading to their detention or interrogation.
How to Find Out if an LOC Has Been Issued:
The LOC (Look Out Circular) is a confidential document, and the general public is unaware if it has been issued.
It is not possible to obtain information about the issuance of an LOC through RTI (Right to Information). Most individuals against whom an LOC is issued become aware of it when detained at the immigration port during travel.
What to do if someone suspects that an LOC has been issued against them?
They can check the following sources:
- Police station where the FIR was filed.
- District SP/DCP officers or officers of equivalent rank from investigative agencies.
- Immigration Law Enforcement authorities.
- Trial Court records (for NRIs), if the court has started issuing the LOC.
Overview of Landmark Cases where Look Out Circulars were issued:
1. Vijay Mallya Case (2016)
The former billionaire and liquor baron, Vijay Mallya, faced allegations of financial irregularities and defaulting on loans worth over ₹9,000 crore. An LOC was issued against him when he fled India, and efforts were made to extradite him from the UK.
2. Nirav Modi and Mehul Choksi Case (2018)
The diamond jeweller Nirav Modi and his uncle Mehul Choksi were involved in a Rs. 13,500 crore banking fraud at Punjab National Bank. After fleeing the country, LOCs were issued to prevent them from escaping justice, and extradition requests were made to the UK and Antigua.
3. Bofors Scandal (1990s)
LOCs were issued in the Bofors scandal to prevent key figures like Ottavio Quattrocchi, an Italian businessman from leaving India, although he managed to escape, complicating legal proceedings.
4. Sahara Group (2012)
LOC was issued against Subrata Roy of the Sahara Group to prevent him from leaving India before fulfilling his financial obligations set by the court.
5. Satyam Scandal (2009)
LOC was issued against the Company’s founder, Ramalinga Raju to prevent him from fleeing as authorities investigated one of India’s largest corporate frauds.
6. Saradha Chit Fund Scam (2019)
The CBI issued a lookout notice for former Kolkata Police Commissioner Rajeev Kumar. Authorities at all airports and immigration checkpoints were alerted to prevent him from leaving the country and to notify the agency of any possible movement.
These cases highlight how LOCs are issued in high-profile economic offenses to prevent the accused from fleeing the country and to ensure accountability.
Landmark Rulings on LOCs: Balancing Investigative Needs with
Fundamental Rights
1. In Showik Indrajit Chakraborty v. Addl. Superintendent of Police & Anr., the Bombay High Court addressed multiple petitions challenging the issuance of Look Out Circulars (LOCs) by the Central Bureau of Investigation (CBI) in connection with a suicide investigation and related cases.
The Court emphasized that LOCs should not be issued arbitrarily, but only when there are valid reasons, such as evasion of arrest or failure to appear in court.
It noted that LOCs are a coercive measure, infringing on an individual’s fundamental right to personal liberty and freedom of movement under Article 21 of the Constitution.
The Hon’ble Bombay HC held that the LOCs must be periodically reviewed to assess their continued necessity as mandated under the Consolidated Guidelines.
The Court further highlighted that the LOC cannot be kept pending indefinitely, in this case for more than 3½ years, though the petitioners have cooperated with the investigation, which fact has not been disputed.
It stressed that the right to travel is fundamental and can only be restricted in accordance with legal procedures.
2. In the case of Siddhartha Sudhir Moravekar v. Serious Fraud Investigation Officer & Ors., the Hon’ble Bombay High Court, while quashing and setting aside the Look-Out Circular (LOC) issued against the Petitioner, remarked that an LOC cannot be wielded as a tool to indefinitely intimidate the Petitioner, particularly when his cooperation in the investigation has been demonstrably established.
It further held that through his actions, the Petitioner has shown a consistent willingness to cooperate with the investigation at every stage. Therefore, an LOC should not, and cannot, be used as a blanket measure to infringe upon the Petitioner’s, or any individual’s, fundamental right to free movement.
3. In another case of Chaitya Shah v. Union of India & Ors., the Bombay High Court upheld the proper issuance and extension of an LOC, emphasizing the petitioner’s significant connection to the investigation and made the following key observations:
- The LOC was properly issued and extended through due process, with the petitioner’s presence deemed necessary for the investigation.
- The petitioner, a non-resident Indian with business and family in Hong Kong, was linked to the investigation due to his involvement with Gitanjali Gems Limited.
- The court referred to the OM of February 22, 2021, emphasizing that LOCs can be issued only for cognizable offences under IPC or other penal laws.
- The court held that the LOC cannot be deleted automatically and must remain active unless a deletion request is made by the originating agency.
- The petitioner’s offer to deposit his parents’ passports did not sway the court, as his full cooperation was still required.
- The court held that the LOC was renewed in accordance with the guidelines due to the continuing relevance of the petitioner to the investigation.
Challenges and Criticisms of Look Out Circulars
While Look Out Circulars are an effective preventive tool, their use has faced criticism and
challenges in practice:
1. Arbitrary or Unfair Use: Critics argue that LOCs can be misused for harassment or to target individuals without sufficient cause. If improperly implemented, the system could violate the individual’s rights to freedom of movement and privacy.
2. Lack of Transparency: There are concerns about the transparency in the process of issuing LOCs. For instance, in some cases, the LOCs are issued without proper checks, leading to potential misuse.
3. Delay in Legal Proceedings: In some cases, the issuance of LOCs has caused delays in legal proceedings, especially when individuals are prevented from traveling for business or personal reasons without being formally arrested or charged.
4. International Cooperation Issues: The efficacy of LOCs depends on the cooperation of international immigration authorities, and the challenges involved in extraditing individuals from foreign countries can often lead to complications, as seen in cases like that of Vijay Mallya.
Conclusion
In conclusion, a Look-Out Circular (LOC) is a critical tool employed by law enforcement agencies in India to prevent individuals suspected of crimes from leaving the country.
While it serves as an essential mechanism to ensure justice in high-profile cases and economic offences, its usage has also raised concerns regarding transparency and the potential for misuse.
With its regulatory framework evolving through the years, the LOC system aims to balance the interests of law enforcement with the protection of individual rights.
However, challenges remain in its implementation, and careful consideration is necessary to prevent any abuse of this powerful legal measure.
At the Chambers of Ashwarya Sinha, we bring a wealth of experience in representing both national and foreign clients against whom a Look Out Circular (LOC) has been issued.
With a profound understanding of the intricate legal complexities surrounding such matters, we have successfully
handled high-profile cases, offering expert representation in both preventive and corrective actions.
Our commitment lies in securing favorable outcomes for individuals facing restrictions on international travel, ensuring that their rights and freedom are effectively protected.
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