Burzin Manek Daver v. Union of India

1. At the outset, learned counsel for the petitioner seeks leave to amend the prayer clause. Leave granted. Amendment to be carried out forthwith.

2. Heard learned counsel for the parties.

3. Rule. Rule is made returnable forthwith, with the consent of the parties and is taken up for final disposal. Mr. Shirsat waives notice on behalf of the respondent No.1-CBI. Learned APP waives notice on behalf of the respondent No.2-State.

4. By this petition, preferred under Article 226 of the Constitution of India and under Section 482 of the Code of Criminal Procedure, the petitioner seeks quashing and setting aside of the Look

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Out Circular ('LOC’) issued by the respondent No.1, in connection with FIR bearing C.R. No.RCBSM2019E0011, registered with the CBI, Banking Securities Fraud Branch, Mumbai, (transferred from CBI, Banking Securities Fraud Branch, Kolkata), at the instance of First Informant-Prabhakar Hemant Kumar Pammi.

5. Mr. Kadam, learned counsel for the petitioner submits that there was no justification for the respondent No.1-CBI to issue an LOC, more particularly when the petitioner has co-operated and is cooperating with the investigation. He submits that infact, the petitioner had settled the Company’s dues with the State Bank of India ('SBI'), pursuant to a one time settlement, after which SBI issued a 'No Dues Certificate', way back in July 2021. Mr. Kadam submits that the petitioner made a representation to the Investigating Officer of the CBI for withdrawal of the LOC, however, the said request has been rejected by the Officer of the CBI on 24th April 2024. Mr. Kadam, learned counsel for the petitioner has placed on record a photocopy of the said reply received from the concerned Officer dated 24th April

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2024. A photo-coy of the same is taken on record.

6. Mr. Shirsat, learned Special Public Prosecutor appearing on behalf of the respondent No.1-CBI has produced the LOC issued at the behest of the respondent No.1-CBI against the petitioner. He submits that merely because the petitioner has settled with the SBI, cannot be a ground for not investigating the C.R. registered at the behest of the respondent No.1-CBI. He submits that investigation is still on-going and that although the C.R. was registered in 2019, in view of the status-quo order, which was in operation till 2023, the investigation could not progress, as desired.

7. Perused the papers. It appears that an FIR bearing C.R. No.RCBSM2019E0011 was registered by the CBI, Banking Securities Fraud Branch, Mumbai, at the instance of SBI, alleging offences punishable under Sections 420, 465, 468, 471, 120B of the Indian Penal Code (‘IPC’) and under Sections 13(2) r/w 13(1)(d) of the Prevention of Corruption Act, on 28th August 2019. The said FIR was

N. S. Chitnis 4/11 registered not only against the petitioner but also against Livewel Airteam Private Limited (‘LATPL’) and other persons, for allegedly defrauding SBI for an amount of Rs.61 crores. It appears that during the course of investigation i.e. on 6th September 2019, the CBI seized several documents and articles. It appears that subsequently i.e. on 26th July 2021, LATPL and SBI entered into a one time settlement, pursuant to which the SBI issued a 'No Dues Certificate' to LATPL, against whom the CBI had registered a case in

2019. It appears that the petitioner learnt of issuance of an LOC when he was at the Mumbai International Airport on his way for a business tour on 20th October 2021. It appears that thereafter, the respondent No.1-CBI issued two notices to the petitioner, one under Section 41A and another under Section 91 of the Code of Criminal Procedure (Cr.PC). The said notices were challenged by the petitioner by way of a writ petition in this Court in October 2021, pursuant to which, this Court vide order dated 12th November 2021 passed an order directing all the parties to maintain status-quo. It appears that pursuant to the LOC issued against the petitioner, the petitioner

N. S. Chitnis 5/11 approached this Court and filed an interim application, pursuant to which the petitioner was permitted to travel abroad for business purposes on certain terms and conditions on three different occasions. It appears that in February 2023, the petition filed by the petitioner was withdrawn in view of the affidavit filed by the respondent-CBI that the investigation would take place in Mumbai and not in Kolkata. Accordingly, liberty was granted to the petitioner to file a substantive petition for quashing of the FIR. It appears that pursuant to said liberty, the petitioner has filed a writ petition in this Court, being Criminal Writ Petition No.678 of 2023 seeking quashing of the FIR. This Court vide order dated 2nd March 2023 directed the CBI to continue with the investigation and recorded the assurance given by the petitioner's advocate that the petitioner will co-operate in the investigation by attending the investigating officer as and when called for. This Court also directed that if any coercive steps were warranted, the petitioner should be issued 72 hours notice. It is not in dispute that after March 2023, the petitioner has not been summoned by the respondent No.1-CBI. N. S. Chitnis 6/11

8. We have perused a copy of the LOC issued as against the petitioner. The said LOC was issued on 6th September 2019. The reason for issuance of LOC is registration of the aforesaid FIR. In column IV (d) the period of LOC retention was mentioned as ‘12 months.’ Mr. Shirsat has not placed on record any extension to show that the said LOC was continued after the expiry of 12 months of the issuance of the first LOC on 6th September 2019. We have in the case of Showik Indrajit Chakraborty v/s Addl. Superintendent of Police and Anr.1, observed that mere registration of an FIR cannot be a ground for issuance of LOC. In the ‘reason’ column (Reason for opening LOC), there is no mention of any apprehension of the petitioner fleeing away and not joining the investigation/trial. Mr. Shirsat has also not placed before us any document to show that the validity of the LOC which was for 12 months, extension was sought.