“Particularised Apprehension” as the New Threshold for Look-Out Circulars:
Delhi High Court in Vineet Gupta v. Union of India & Ors. (2025 DHC 4924)

1. Introduction

In Vineet Gupta v. Union of India & Ors. (W.P.(C) 7850/2025, decided on 6 June 2025), the Delhi High Court (“DHC”) confronted a recurring tension between the State’s interest in securing the presence of accused persons and the individual’s fundamental right to travel abroad under Article 21 of the Constitution. Two petitioners – founders of a business house facing investigations by the CBI, Enforcement Directorate (ED) and a consortium of banks – sought suspension of Look-Out Circulars (“LOCs”) so that they could visit the United States and other countries for family reasons.

Although the quantum of the alleged fraud (₹1626.74 crores) was undeniably large, the Court found the Bank’s opposition “highly generic and vague” and eventually allowed both petitioners to travel upon stringent financial and supervisory conditions. The decision crystallises an important rule: “An LOC may not be sustained merely on the basis of sweeping assertions; the sponsoring agency must demonstrate a specific and credible apprehension that the individual will abscond or obstruct the legal process.”

2. Summary of the Judgment

• Applications: Two interlocutory applications under s.151 CPC seeking suspension of LOCs and release of passports for specified dates.
• Court’s Findings:
  • The LOC at the behest of the CBI had already been closed (1-Aug-2024).
  • The ED’s LOC stood suspended by a Special PMLA Court (29-Apr-2025).
  • P&H High Court had set aside the Bank’s fraud declaration; FIR quashing was remanded but the fraud classification remained quashed.
  • The Bank’s affidavit offered only “assumptions” and no concrete material showing flight-risk or prejudice to investigation.
  • The Supreme Court’s jurisprudence affirms that the right to travel is an integral facet of Article 21 – any restriction must satisfy the doctrine of proportionality.
• Result: LOCs were suspended for the requested travel windows. Additional conditions included:
  • Detailed itinerary + continuous mobile connectivity.
  • No extension except medical emergency; mandatory return date.
  • ₹50 lakh indemnity bond and ₹25 lakh FDR per petitioner, subject to forfeiture upon breach.

3. Analysis

3.1 Precedents and Authorities Cited or Implicitly Relied Upon

1. Maneka Gandhi v. Union of India, (1978) 1 SCC 248 – the locus classicus affirming that the “procedure” impinging on personal liberty must be “right, just and fair.”
2. Satwant Singh Sawhney v. D. Ramarathnam, AIR 1967 SC 1836 – first case to recognise the freedom to travel abroad under Article 21.
3. Vikram Sharma v. Union of India, 2010 (Delhi HC) – guidelines on issuance/review of LOCs, emphasising necessity of tangible material and periodic review.
4. Office Memoranda of the MHA (2000, 2010, 2021) – statutory/executive framework governing LOCs; they require that the sponsoring agency “clearly state” the reasons and nature of offence.
5. Orders of the Special Judge (PMLA) and CBI Court, Chandigarh (Mar-Jun 2025) – these orders permitted foreign travel in the very predicate offences, under rigorous conditions, signalling judicial satisfaction about absence of flight risk.

While the instant judgment does not set out these citations exhaustively, Justice Harish Vaidyanathan Shankar’s reasoning is anchored in the above line of authorities.

3.2 Legal Reasoning

a. Effect of Prior Judicial Orders
The Court treated the closure/suspension of LOCs by the CBI and ED, as well as permission granted by the Special PMLA Court, as persuasive – if the principal investigating agencies with stronger coercive powers saw no present threat, a consortium bank’s bare allegations could not tip the scale.

b. Requirement of Specificity
The Bank’s affidavit merely stated that the petitioners “may abscond in search of safe haven.” The Court labelled this “highly generic and vague.” The message is clear: an LOC cannot survive on conjecture; sponsoring agencies must bring forth:

• Concrete instances of evasion or past non-cooperation;
• Material suggesting secret assets abroad;
• Any imminent stage of investigation/trial that would be jeopardised by absence.

c. Proportionality under Article 21
Following Maneka Gandhi and subsequent privacy jurisprudence (K.S. Puttaswamy), the Court applied a proportionality matrix:

1. Legitimate Aim – securing the accused’s presence.
2. Suitability – an LOC is capable of achieving that aim.
3. Necessity – if less restrictive alternatives (e.g., bonds, FDR, itinerary) suffice, a travel-ban is excessive.
4. Balancing – personal liberty versus public interest; in absence of concrete risk, liberty prevails.

d. Family Reasons as Bona Fide Grounds
Indian courts have traditionally recognised educational or medical travel as legitimate. Here, graduation of a child at Yale and inability of US-based children to visit India were treated as genuine, further reducing suspicion.

3.3 Potential Impact

• Elevation of the evidentiary standard for LOCs: Investigative agencies and banks will have to place particularised evidence before the court.
• Uniformity with MHA O.M. 2021: The judgment dovetails with the executive requirement of “reasonably specific inputs” and therefore harmonises administrative and constitutional law.
• Stronger scrutiny of fraud-declaration regime: Banks often weaponise fraud declarations to precipitate LOCs. By noting that the P&H High Court had already annulled the declaration, the DHC signals that once such classification is set aside, consequential coercive measures weaken automatically.
• Template Conditions: The Court re-affirms a “menu of safeguards” (itinerary, bonds, FDRs, mobile tracking) which other courts can replicate, thereby facilitating balanced liberty.

4. Complex Concepts Simplified

Look-Out Circular (LOC)

An LOC is an electronic alert circulated at immigration check-posts requiring authorities to stop a person from leaving or entering India. It can be issued by various agencies (CBI, ED, Banks) for offences involving cognisable crimes, defaults, or national security concerns.

Section 151 CPC

A residuary provision empowering civil courts (and Writ Courts by analogy) to pass orders “for the ends of justice” where no specific procedural rule exists.

Indemnity Bond v. FDR

An indemnity bond is a personal undertaking backed by personal or third-party sureties, whereas an FDR (Fixed Deposit Receipt) is a tangible monetary security deposited with the court, easier to forfeit upon breach.

Declaration of Fraud (RBI Master Directions, 2016)

A banking determination that classifies an account as fraudulent, enabling criminal referral. If set aside by a court, ancillary actions predicated on it (e.g., LOCs) lose much of their footing.

5. Conclusion

The Delhi High Court’s ruling in Vineet Gupta is not merely a fact-specific order permitting two businessmen to attend family events abroad. It establishes a doctrinal yardstick: mere magnitude of alleged economic offence does not, by itself, justify a perpetual travel embargo; the sponsoring agency must articulate a particularised apprehension of flight or obstruction.

This elevated threshold furthers the constitutional promise of personal liberty while simultaneously equipping courts with a replicable blueprint of protective conditions. Going forward, investigating agencies and financial institutions will have to marshal concrete facts – not conjecture – to survive judicial scrutiny. Defence counsel, conversely, can rely on this decision to argue that, absent such facts, liberty must be restored with reasonable safeguards.

Key Takeaway:
An LOC is an extraordinary measure, not a default reaction. Where the right to travel collides with investigatory concerns, the latter must prove necessity with specificity; otherwise, Article 21 will prevail.