Finally, on the issue whether petitioner’s case fell within the ambit of the clause ‘detrimental to economic interests of India’, the Court said that it has to be kept in mind that the issuance of a LOC necessarily curtails the rights of an individual to travel abroad.
Therefore, for the invocation of a clause which is meant to be used in exceptional and rare circumstances, a mandatory pre-condition would be a formation of a reasonable belief by the authority that the departure of the individual would be ‘detrimental to the economic interests of India’ to such an extent that it warrants curtailment of an individual’s right to travel abroad.
The Court noted that in the present case, the respondents’ belief that petitioner’s departure would be ‘detrimental to the economic interests of India’ hinges on an unsigned draft agreement and some WhatsApp chats, which even in their own view, is not conclusive. It further said that they are still awaiting a response from authorities in Dubai to proceed against the petitioner under the Black Money Act 2015, Income Tax Act 1969 and the Prevention of Money Laundering Act 2002.
“It is important to note that the petitioner herein earns his livelihood by exporting garments to the United States of America, Europe, South America, the United Kingdom and the United Arab Emirates; an integral part of such business is overseas travel. The LOC does not only curtail his right to personal liberty but also his right to livelihood, as enshrined in Article 21 the Constitution of India,” the Court opined.
Thus, it concluded that the issuance of a LOC against the petitioner, without any end in sight, would definitely cause irreparable and considerable damage to the business interests of the petitioner.”
Justice Palli said that it also has to be kept in mind that the issuance of a LOC is an extremely severe step and the authorities must tread with caution when issuing it and it should be done only in exceptional circumstances.
‘Merely because the OM dated 05.12.2017 permits the issuance of a LOC, in exceptional circumstances, even when the individual is not involved in any cognizable offense under the IPC or any other penal law, it has to be remembered that this power, is meant to be used in exceptional circumstances and not as a matter of routine, it must therefore, be interpreted in a manner that indicates an offense of such a magnitude so as to significantly affect the economic interests of the country,” the Court said.