2022 (9) TMI 168 - HC - Money Laundering

Court upholds Look Out Circular against UK citizen of Indian origin, citing ties to illegal activities

Girish Sagar Versus Union Of India & Others

The court dismissed the petition seeking the quashing of the Look Out Circular (LOC) issued against the petitioner, a UK citizen of Indian origin. The ... Money Laundering - proceeds of crime - Withdrawal/cancellation/ quashing/discontinuation/recalling of the Look Out Circular issued in the name of the Petitioner - seeking permission to Petitioner to return to his home in the United Kingdom - principles of res-judicata - HELD THAT:- The rule of res judicata is based on public policy as finality should attach to the binding decisions pronounced by courts of competent jurisdiction. This is applicable to writ proceedings through the process of judicial interpretation and a party is precluded from initiating fresh legal in respect of same cause of action. If a writ petition is filed in a High Court or Supreme Court and is rejected on merits then a subsequent writ petition cannot be moved on the same cause of action. Even if in the first petition a plea which could have been raised is pot raised, the matter cannot be agitated in a subsequent petition because of constructive res judicata. It is also based on public policy and to prevent harassment and hardship to the opposite party - The principle of res judicata applies not only when an issue has actually been adjudicated by a court of competent jurisdiction but also when the issues that were actually raised but in fact not decided. It is correct that as per Status Report filed by the respondents no. 4 & 5/CBI a case was registered vide RC 13/2016/EOW Mumbai on 19.09.2016 at CBI/EOW/Mumbai Branch for commission of offences under section 120-B IPC read with section 420 IPC and section 13(2) r/w 13(1)(d) of Prevention of Corruption Act, 1988 against Hasan Ali Khan, unknown public servants, and others and said case is still under investigation by GBI/AG-VI/SIT, New Delhi but the petitioner has not been implicated as an accused in said FIR/RC and during investigation the role of the petitioner was not clearly established and the petitioner was not made an accused by CBI in any FIR registered at Mumbai. Whenever a suit/writ is instituted before the court, the initial issue is to be decided whether the court has jurisdiction to deal with the matter. If the court does not have jurisdiction then it will be recognized as lack of jurisdiction and irregular exercise of jurisdiction. If the court does not have jurisdiction to decide the case then such decision would be regarded as void or voidable depending upon the circumstances. Jurisdiction is not defined and explained in Code of Civil Procedure, 1908. Jurisdiction is power and competence of the court to adjudicate case. Jurisdiction is boundary of court in exercise its judicial authority. The respondent no. 4/CBI, EOW, Mumbai registered FIR bearing no. RCD682016E0013 dated 19.09.2016 under section 120-B read with section 420 of the Indian Penal Code, 1860 read with Section 13(1) (d) of Prevention of Corruption Act, 1988 and thereafter the respondent no. 2 considering nature of scheduled offences and involvement of proceeds of crime of Rs. 36000 crores initiated investigation under PMLA vide ECIR/HQ/02/2017 dated 24.01.2017 at Delhi. Mere fact that the respondent no. 2 through the respondent no. 6 on the request of the respondent no. 3 issued LOC dared 10.02.2016 at Delhi does not create or vest territorial jurisdiction in courts at Delhi. No cause of action either wholly or in part has ever been arisen in Delhi for filing the present petition. This court is lacking territorial jurisdiction to entertain the present petition. Petition dismissed. Issues Involved:1. Quashing of the Look Out Circular (LOC) issued against the petitioner.2. Validity and legality of the LOC.3. Jurisdiction of the court to entertain the petition.4. Principle of res judicata in relation to the previous petition dismissed by the High Court of Bombay.Issue-wise Detailed Analysis:1. Quashing of the Look Out Circular (LOC) issued against the petitioner:The petitioner, a UK citizen of Indian origin, sought the quashing of the LOC issued against him on 10.02.2016 by the respondent. The petitioner argued that the LOC was issued without justified or cogent reasons, contradicting the Office Memorandum dated 27.10.2010 from the Ministry of Home Affairs. The petitioner claimed that the LOC was issued without any pending criminal case or trial against him and that it violated his fundamental right to travel, as guaranteed under Article 21 of the Constitution.2. Validity and legality of the LOC:The court examined the validity of the LOC under the guidelines provided by the Office Memorandum dated 27.10.2010 and its amendment dated 05.12.2017. The LOC was initially issued under the 2010 guidelines, which required a cognizable offense for its issuance. However, the petitioner was not implicated in any cognizable offense at the time. The amendment in 2017 allowed for LOCs in exceptional cases, even without a cognizable offense, if the departure of the individual was deemed detrimental to India's sovereignty, security, or economic interests. The court found that the petitioner's association with Hassan Ali Khan, involved in large-scale money laundering and illegal activities, justified the issuance and continuation of the LOC under the amended guidelines.3. Jurisdiction of the court to entertain the petition:The court addressed whether it had the territorial jurisdiction to entertain the petition. The petitioner argued that the court had jurisdiction as the LOC was issued by an authority based in Delhi. However, the court noted that the primary investigation and related prosecution complaints were filed in Mumbai, and the petitioner had previously subjected himself to the jurisdiction of Mumbai courts. The court concluded that no cause of action had arisen in Delhi, and thus, it lacked territorial jurisdiction to entertain the petition.4. Principle of res judicata in relation to the previous petition dismissed by the High Court of Bombay:The respondent argued that the present petition was barred by res judicata, as the petitioner had previously filed a similar petition before the High Court of Bombay, which was dismissed. The court agreed, stating that the principle of res judicata prevents the re-litigation of issues that have already been adjudicated by a competent court. The court found that the issues raised in the present petition were substantially similar to those in the previous petition dismissed by the Bombay High Court, and thus, the present petition was barred by res judicata.Conclusion:The court dismissed the petition, upholding the validity of the LOC under the amended guidelines and finding that the petition was barred by res judicata. The court also determined that it lacked territorial jurisdiction to entertain the petition.