Delhi High Court - Orders
Devesh Narain Gupta vs Union Of India & Anr on 25 April, 2026
Author: Purushaindra Kumar Kaurav
Bench: Purushaindra Kumar Kaurav
$~22
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ W.P.(C) 787/2025&CM APPL. 8770/2025
DEVESH NARAIN GUPTA .....Petitioner
Through: Mr. Samaksh Goyal, Adv.
versus
UNION OF INDIA & ANR. .....Respondents
Through: Ms. Nidhi Ramam, CGSC with Mr.
Akash Mishra and Mr. Arnav Mittal,
Advs. for UOI.
Mr. Anupam S Sharrma, SPP CBIwith
Ms. Harpreet Kalsi, Mr.Vasisht Rao,
Mr.Abhiyant Singh, Ms.Amisha P
Dash and Mr. Mayank Tyagi, Advs.
CORAM:
HON'BLE MR. JUSTICE PURUSHAINDRA KUMAR KAURAV
ORDER
% 25.04.2026 (The matter has been taken up today, as 03.03.2026 was declared as a holiday.)
1. The instant petition is for the following reliefs:
"A. Issuance of a writ, order or direction in the nature of a certiorari or any other appropriate writ quashing the look -aut circular issued by the Respondents against the Petitioner in relation to RC2232021A0009 at PS AC-V Delhi, Central Bureau of Investigation;
B. Allow the Petitioner to travel internationally to Canada to his daughter for his trip;"
2. The LOC seems to have been issued at the instance of the Central Bureau of Investigation (CBI), State Bank of India and Central Bank of India.
This is a digitally signed order.
The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 15/05/2026 at 20:56:31 The facts of the case would indicate that the company namely M/s. SHRI Lakshmi Cotsyn Ltd. ('company') came to be incorporated, and there were three promoters. The company was involved in the business of textile, fabrics, garments, etc. and operated textile units.
3. The petitioner, who is MSc in Chemistry, joined the company as an employee to oversee the technical aspects of the business in the year 1992.During 2005-2010, the company availed loans amounting to about Rs. 200 crore at the behest of the promoters. Now the consortium of 23 banks, Lead Bank was Central Bank of India.
4. In the year 2013, the company defaulted in the payment of the said law. Between 2013-18, efforts to restructure the loan remained unsuccessful, and on 30.05.2018, the company was admitted into corporate insolvency resolution process (CIRP) upon filing of a Section 7 application under the provisions of the Insolvency and Bankruptcy Code (IBC), 2016 by one of the consortium members, that is, Union Bank of India. In the year 2020, the company was admitted into liquidation.
5. In the year 2021, it appears that the Central Bank of India made a complaint to CBI. Thereupon, CBI registered a FIR on 04.08.2021. The CBI, thereafter, raided the petitioner's house and collected certain documents. During the year 2024, when the petitioner was travelling abroad, he came to know about opening of the LOC. The petitioner later came to know about two other LOC issued at the instance of respective banks. During the pendency of the petition, the petitioner was allowed to travel to Canada. He complied with the terms and conditions and has reported back.
6. What thus transpires is that the investigation began on 04.08.2021 and it is still ongoing. There is no allegation of non-cooperation of the petitioner This is a digitally signed order.
The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 15/05/2026 at 20:56:31 in any manner whatsoever. The petitioner seems to have been called by the CBI only once. The petitioner undertakes to cooperate. The CIRP proceedings culminated into liquidation proceedings which are currently pending. The bank seems to have secured their interest in the said proceedings.
7. The complicity of the petitioner has not yet emerged. He has not been arrested, and no chargesheet was filed against him. Further, there does not seem to be any element of flight risk as the petitioner has earlier travelled Canada and has reported back.
8. This Court in Ritu Singhal v. Bureau of Immigration &Ors.1has while examining various aspects of the legal framework governing the issuance, continuance and judicial review of LOCs, considered the decisions in Sumer Singh Salkan v. Asst. Director 2 , Karti P. Chidambaram v. Bureau of Immigration3, Viraj Chetan Shah v. Union of India4, Bank of Baroda v. Sahil Chugh5, Rajesh Kumar Mehta v. Union of India6, Apurve Goel v. Bureau of Immigration 7 , Brij Bhushan Kathuria v. Union of India 8 , Shalini Khanna v. Union of India 9 , Puja Chadha v. Directorate of Enforcement10, Prashant Bothra v. Bureau of Immigration11, Anant Raj Kannoria v. Union of India &Anr.12, Maria Ramesh v. Union of India 1 2026:DHC:3806.
22010 SCC OnLine Del 2699.
32018 SCC OnLine Mad 2229.
42024 SCC OnLine Bom 1195.
52025 SCC OnLine Del 9282.
62024 SCC OnLine Del 4153.
72023: DHC:6886.
82021 SCC OnLine Del 2587.
92024 SCC OnLine Del 837.
102025: DHC:8787.
112023 SCC OnLine Cal 2643.
12W.P.(C) 3313/023 decided on 09.01.2026.
This is a digitally signed order.
The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 15/05/2026 at 20:56:31 &Ors.13, Ritwick Dutta v. Union of India &Ors.14. Para. 33 to 38 of Ritu Singhal (supra) reads as under:
"33.On a conspectus of constitutional provisions, the regulatoryframework, and the entire body of judicial opinion surveyed above,this Court distils the following governing legal principles for theissuance, continuance, and judicial review of Look Out Circulars"
"34. First,the right to travel abroad is an integral facet of thefundamental right to life and personal liberty under Article 21 of theConstitution. Any restriction on this right must be founded on law,must follow a procedure thatis just, fair, and reasonable, and must notviolate any other fundamental right. Executive instructions cannot be asubstitute for legislative mandate for the possible restriction of fundamental rights. Second, an LOC is a coercive executive measureof last resort. It is not a routine tool for law enforcement or debtrecovery. Recourse to an LOC may be taken only in cases involving acognizable offence under the IPC or other penal laws, where theaccused is deliberately evading arrest or not appearing before the trialCourt despite NBWs and other coercive measures, and there is a realand proximate likelihood of absconding.
35. Third, public sector banks, through their Chairman, ManagingDirectors, or Chief Executive Officers, do not possess legal authorityto seek the opening of an LOC. Clause 6(B)(xv) of the 2021 OM(equivalent to Clause 8(b)(xv) of the 2010 OM), which conferred suchpower upon bank officials, stands quashed by decisions of both thisCourt and the Bombay High Court.
[Emphasis Supplied]
36.Fourth, mere inability to repay a debt, without there being acriminal case, cannot be a reason to deprive a citizen of thefundamental rights guaranteed under Article 21. The issuance of anLOC cannot be resorted to in every case of bank loan default or creditfacility availed for business purposes. Where the person against whomthe LOC is opened has not been arrayed as an accused in any offencefor misappropriation or siphoning, the LOC cannot be sustained. Fifth,the power under Clause 6(L) of the 2021 OM to issue an LOC in casesdetrimental to the "economic interests of India" is to be narrowlyconstrued and must be exercised only in rare and compellingcircumstances where the proposed departure poses a clear and gravethreat to the national or systemic economic interests of India, not incases of routine commercial default or individual business failure. Thequantum of the alleged default and the nature of the loss must 13 W.P.(C) 15701/2022 decided on 27.01.2026.14
W.P.(C) 12862/023 decided on 02.02.2026.
This is a digitally signed order.
The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 15/05/2026 at 20:56:31 beassessed to determine whether it genuinely imperils the nationaleconomic interest.
[Emphasis Supplied]
37. Sixth, the authority charged with opening an LOC must applyits mind independently and cannot act as a mere instrument of theoriginating agency. There must be a speaking order, based on specificand credible inputs, justifying the necessity of the restraint. Amechanical or pro forma compliance with the originating authority'srequest cannot satisfy this requirement. Seventh, an LOC cannot beissued against a person merely on account of his status as a director,guarantor, shareholder, or family member of a defaulting borrower, inthe absence of specific material demonstrating his direct and personalrole in the alleged wrongdoing. Guilt is personal and not vicarious in civil or criminal liability.
38. Eighth, the continuance of an LOC is not indefinite. It must beperiodically reviewed and must be withdrawn when its purpose hasbeen served. Where the subject has cooperated with the investigation,has not evaded process, and where no further interrogation or presenceis required, the continued operation of an LOC amounts to anunreasonable and unjustified restriction on personal liberty. Ninth,while the High Court, in exercise of writ jurisdiction, is duty-bound tosubject LOCs to strict judicial scrutiny, the Writ Court is not theexclusive forum for challenge. A person against whom an LOC hasbeen issued may, in the first instance, approach the originatingauthority for withdrawal, or approach the trial Court for its rescissionor modification. However, where these remedies are inadequate orineffectual, the writ jurisdiction is clearly available. Tenth, the burdenof justifying the necessity, proportionality, and legality of an LOC liessquarely upon the originating agency. In the absence of suchjustification, the LOC cannot be sustained. Courts must not acceptbald assertions of security concerns or economic interest without requiring the originating agency to place credible material before theCourt.
9. For the abovementioned reasoning and justification, the LOC issued at the instance of the bank and the CBI deserves to be set aside under the following terms and conditions:
(i) The Petitioner shall co-operate with the ongoing and/or future investigations, if any, instituted at the behest of the concerned investigation agency.
(ii) The Petitioner shall be entitled to travel abroad without any prior This is a digitally signed order.
The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 15/05/2026 at 20:56:31 permission from this Court. The Petitioner shall, however, intimate the Investigation Officer, with its full itinerary either personally or through counsel, at least 7 days prior to his departure.
(iii) If, in case of emergency, where intimation cannot be given as aforesaid, the petitioner shall give the requisite intimation atleast 24 hours prior to the travel.
(iv) If the chargesheet is filed, the Petitioner shall approach the concerned Court and thereafter, shall take the permission for travelling abroad.
(v) If, pursuant to any change in law or other supervening event, including but not limited to any declaration by a Court affirming the competence or jurisdiction of financial institutions to seek issuance of LOCs, such institutions/agencies shall be at liberty to seek issuance of LOCs in accordance with law.
10. With the aforesaid observations, the instant petition stands disposed of.
PURUSHAINDRA KUMAR KAURAV, J APRIL 25, 2026/SH This is a digitally signed order.
The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 15/05/2026 at 20:56:31