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Informist, Tuesday, Jan. 7, 2025

 

NEW DELHI – Suspending the look-out circulars issued by the Department of Revenue and the Serious Fraud Investigation Office, the Delhi High Court allowed Punj Lloyd Ltd.'s former promoter and director Atul Punj to travel to the United Kingdom from Feb. 1 to Feb. 15, with certain conditions. The court said Punj should deposit a fixed deposit receipt of INR 50 million with its registrar general. The fixed deposit shall be kept in auto-renewal mode.

 

The high court also asked Punj to deposit the original title deeds of a property valued at INR 538.9 million, which was in the name of his wife, with its registrar general. This security shall be accompanied by an undertaking submitted by Punj's wife that she would have no objection in case the property was forfeited in the event of any of the conditions imposed on Punj being violated, the court said. In the undertaking, Punj's wife would also have to specifically undertake to not alienate or mortgage the property without the court's permission, subject to further orders.

 

Punj was granted the liberty to approach the high court upon the completion of the Serious Fraud Investigation Office probe to seek quashing or suspension of the look-out circulars issued by the respondents, should the circumstances warrant such action, said Justice Sanjeev Narula.

 

The high court said the right to travel abroad, being an essential component of the right to personal liberty under Article 21 of the Constitution, cannot be curtailed arbitrarily or indefinitely. Restrictions such as a look-out circular must pass the test of proportionality and necessity, ensuring that they are imposed only when supported by credible material, it said. "In the absence of conclusive findings after five years of investigation and with the petitioner's continued cooperation, the prolonged restrictions on his right to travel cannot be justified," the court said.

 

In 2019, the National Company Law Tribunal had admitted a petition by ICICI Bank to start insolvency proceedings against Punj Lloyd, which eventually led to an order to liquidate the company. In February, IDBI Bank had issued a show-cause notice under the RBI Master Directions on Frauds Classification and Reporting to Atul Punj and others. The proceedings in this matter are pending.

 

The Centre had directed the Serious Fraud Investigation Office to probe Punj Lloyd's affairs in 2019. Thereafter, in 2022, the Centre had issued directions to the Serious Fraud Investigation Office to start a probe against Atul Punj and his son under Sections 241, 242, 246, and 339 of the Companies Act, 2013. Further, following a survey conducted by the Income Tax Department, Atul Punj and his son were subjected to proceedings under the Black Money Act by the office of the Deputy Director (Investigation), Income Tax Department. The Serious Fraud Investigation Office and the Income Tax Department had strongly opposed Punj's request to suspend the look-out circulars.  End

 

Reported by Surya Tripathi

Edited by Rajeev Pai

 

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