Travel restraint in aid of proceedings upheld, but passport impounding remains with the competent passport authority.

A tribunal may restrain respondents from leaving India where allegations of undervalued and fraudulent transactions create a real risk of evasion of proceedings; the restraint was therefore continued and made absolute. However, the power to impound or require surrender of a passport lies with the competent passport authority under the Passport Act, not with the tribunal itself. The request for direct impounding was refused, while liberty was preserved to seek appropriate relief before the passport authorities in accordance with law.

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Issues: (i) Whether the non-applicant respondents could be restrained from leaving the country without prior permission of the Tribunal. (ii) Whether the Tribunal could itself direct impounding or surrender of passports, or only grant liberty to approach the passport authorities.

Issue (i): Whether the non-applicant respondents could be restrained from leaving the country without prior permission of the Tribunal.

Analysis: The application was founded on allegations of undervalued and fraudulent transactions and on the apprehension that the respondents might evade the process. The Tribunal found that the allegations were substantial and that the respondents would be required by law-enforcing agencies. It held that prior cooperation and local roots did not remove the risk sufficiently to justify vacating the earlier restraint.

Conclusion: The restraint on leaving the country was made absolute and the respondents were directed not to leave India without prior permission of the Tribunal.

Issue (ii): Whether the Tribunal could itself direct impounding or surrender of passports, or only grant liberty to approach the passport authorities.

Analysis: The Tribunal accepted that the power to impound a passport vests in the passport authorities under the Passport Act, not in the Tribunal. It followed the principle that retention or impounding of a passport must be done by the competent statutory authority under the prescribed procedure. At the same time, it held that the applicant could seek appropriate relief before the passport authorities in accordance with law.

Conclusion: The prayer for direct impounding by the Tribunal was not granted, but liberty was preserved to move the passport authorities under the Passport Act.

Final Conclusion: The proceeding resulted in a continued travel restraint against the respondents, while the request for impounding passports was left to the competent passport authorities under the statutory mechanism.

Ratio Decidendi: A tribunal may restrain parties from leaving the country in aid of pending proceedings, but the power to impound a passport belongs to the competent passport authority under the Passport Act.

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