Case Note & Summary
The petitioner filed a petition seeking quashing of a Look Out Circular (LOC) dated 1st October 2019 issued by the Enforcement Directorate (ED) in a Prevention of Money Laundering Act (PMLA) case. The petitioner was arrested on 11th October 2019 and released on bail on 30th November 2019 by the Special Court, Mumbai, with a condition not to leave India without prior permission. Post-bail, the petitioner travelled overseas on five occasions with court permission and returned each time. The petitioner argued that the LOC was not reviewed periodically as mandated by the Ministry of Home Affairs Office Memorandum dated 22nd February 2021. The court examined the LOC and noted that the reason for its issuance was that the petitioner was an associate of Iqbal Mirchi and suspected to be involved in conspiracy to transfer proceeds of crime overseas. The court found that the ED failed to place on record any evidence of periodic review of the LOC as required by Clause J of the Office Memorandum. The court held that the LOC was unsustainable due to non-compliance with the review mandate. The petition was allowed, and the LOC was quashed and set aside. The court clarified that the petitioner must comply with bail conditions and that the ED may issue a fresh LOC if occasion arises in accordance with law. The petitioner was also granted liberty to apply for return of passport before the trial court.
Headnote
A) Criminal Procedure - Look Out Circular - Periodic Review - Ministry of Home Affairs Office Memorandum dated 22nd February 2021, Clause J - The originating agency is required to review LOCs on a quarterly and annual basis and submit proposals to delete the LOC if necessary. Failure to do so renders the LOC unsustainable. (Paras 7-8) B) Prevention of Money Laundering Act, 2002 - Bail Conditions - Travel Abroad - The petitioner had been granted bail with a condition not to leave India without prior permission. The petitioner had travelled abroad on five occasions with permission and returned, demonstrating compliance. (Paras 4, 6) C) Criminal Procedure - Look Out Circular - Quashing - The court quashed the LOC issued by ED against the petitioner due to non-compliance with review requirements, while clarifying that the ED may issue a fresh LOC if occasion arises. (Paras 8, 10)
Issue of Consideration
Whether a Look Out Circular (LOC) issued by the Enforcement Directorate (ED) can be sustained when the originating agency fails to conduct periodic review as mandated by the Ministry of Home Affairs Office Memorandum dated 22nd February 2021.
Final Decision
Petition allowed. LOC dated 1st October 2019 issued by ED against the petitioner is quashed and set aside. Rule made absolute. Petitioner to comply with bail conditions. ED may issue fresh LOC if occasion arises in accordance with law. Petitioner at liberty to apply for return of passport before trial court.
Law Points
- Look Out Circular
- periodic review
- Ministry of Home Affairs Office Memorandum
- PMLA
- bail conditions
- right to travel
