Look Out Circulars – Quashing by Single Judge – Letters Patent Appeals by Public Sector Bank – Directors/Partners of borrower entities declared wilful defaulters – No criminal proceedings pending – Held: Mere civil default in repayment of loans cannot justify issuance of LOCs infringing fundamental right to travel under Article 21 [Paras 1, 6, 15].

Constitutional Law – Article 21 – Right to Travel Abroad – LOCs – Restrictions on movement – Held: Though right to travel is not absolute, any restriction must withstand judicial scrutiny and be backed by compelling reasons such as threat to sovereignty, security or economic interest of India – Absence of such foundational facts renders LOC unsustainable [Paras 14–15, 17].

Banking Law – Wilful Defaulters – SARFAESI Proceedings – Declaration as NPA – Civil Recovery Proceedings Pending before DRT – Held: Pendency of SARFAESI measures and recovery proceedings, without criminality, does not by itself warrant coercive restriction on personal liberty through LOCs [Paras 3–6, 15].

Administrative Law – Look Out Circular Regime – Authority to Issue Guidelines – Ministry of Home Affairs as Nodal Ministry – Office Memorandum of Ministry of Finance dated 22.11.2018 – Nature and Effect – Held: OM of Ministry of Finance is at best advisory and cannot override or expand the LOC framework prescribed by MHA [Paras 7, 13].

Economic Interest of India – Interpretation – “Detrimental to Economic Interest” – Reliance on Prateek Chitkara v. Union of India – Held: LOCs cannot be issued in every case of bank default – Circumstances must disclose higher gravity and larger impact on national economy – Routine business failures or inability to repay loans insufficient [Paras 8–9, 14].

Precedent – Bombay High Court – Viraj Chetan Shah v. Union of India – Power of Public Sector Banks to Seek LOCs – Clause empowering CMD/CEOs quashed – Held: With authority of banks to request LOCs having been divested, reliance on Finance Ministry OM becomes untenable [Para 16].

Appellate Review – Interference with Reasoned Judgment – Single Judge’s Order Quashing LOCs – Held: No perversity or legal infirmity shown – Appeals dismissed at admission stage [Paras 12, 18].

Decision: All Letters Patent Appeals dismissed – Judgments of learned Single Judge quashing Look Out Circulars upheld – No order as to costs.

Prevention of Money Laundering Act, 2002 (PMLA) – ECIR – Quashing – Maintainability – An ECIR is an internal administrative document, not equivalent to an FIR, and its quashing is generally declined in writ jurisdiction unless there are clear jurisdictional defects, such as the absence of a scheduled offence or violation of statutory safeguards – The ECIR in this case, based on multiple FIRs including some with scheduled offences, cannot be quashed in its entirety at the nascent stage of investigation – The Court declined to quash the ECIR entirely but suspended investigative measures related to the consolidated FIRs whose proceedings were stayed – The ECIR remains valid for independent Mist Avenue FIRs which contain scheduled offences and are not subject to the Supreme Court's consolidation order or any stay – The Court held that complete quashment would necessitate re-registration and create procedural inefficiency [Paras 59, 108, 109, 113, 170, 171].

Prevention of Money Laundering Act, 2002 (PMLA) – Predicate Offence – Effect of Stay – Section 3 PMLA – The offence of money laundering is derivative and contingent upon the existence of a scheduled offence – While a stay order does not extinguish an FIR, it suspends the judicial operability of the predicate offence – Investigative measures by the ED qua consolidated FIRs, whose predicate proceedings are stayed by a competent court, must also be stayed to prevent circumvention of judicial orders and uphold judicial discipline – The Court held that the ED cannot proceed with investigation into proceeds of crime when the very question of whether a predicate offence was committed remains judicially suspended – The Court distinguished between a stay (suspension) and quashing (extinguishment) of proceedings – The Court directed a stay on ED's investigative measures related to the consolidated Grand Venice FIRs until the final adjudication of the Criminal Misc. Application No. 25724/2022 or framing of charges in Case No. 1559/2019, or any final order by the competent court – The Court relied on Vijay Madanlal Choudhary (Supra) and Mantri Developers Pvt. Ltd. v. Directorate of Enforcement [Paras 24, 25, 26, 53, 61, 62, 63, 64, 91, 112, 144, 146, 147, 148, 149, 150, 151, 152, 153, 157, 158, 160, 162, 164, 165, 167, 169].

Prevention of Money Laundering Act, 2002 (PMLA) – Non-Bailable Warrants (NBWs) – Issuance during Investigation – NBWs are coercive measures to secure an accused's presence, not for punishment, and should not be issued mechanically without clear evidence of evasion or likelihood of abscondence – The petitioner's consistent cooperation, including appearances and document submissions, and the prolonged nature of the investigation (over four years without a prosecution complaint), rendered the NBWs unjustified – The ED's allegations of evasion were not sufficiently substantiated by documentary evidence – The Court held that the NBWs issued on 11.04.2025 were inconsistent with procedural safeguards at the pre-complaint stage under PMLA and were hereby cancelled – The Court relied on Inder Mohan Goswami v. State of Uttarakhand and Satender Kumar Antil v. CBI [Paras 30, 31, 32, 33, 34, 35, 36, 65, 66, 67, 68, 69, 70, 71, 72, 73, 93, 94, 95, 96, 97, 98, 99, 100, 172, 173, 174, 175, 176, 177, 178, 179, 180, 181, 182, 183, 184, 185, 186, 187, 188, 189, 190, 191, 192, 193].

Prevention of Money Laundering Act, 2002 (PMLA) – Search and Seizure – Section 17 PMLA – Challenge to search and seizure proceedings on grounds of "no reason to believe" is premature as the petitioner has an efficacious alternate statutory remedy before the Adjudicating Authority under PMLA – Allegations of misconduct during search involve disputed questions of fact not amenable to writ jurisdiction – The Court declined to interfere with the search and seizure proceedings [Paras 42, 43, 44, 45, 46, 74, 75, 76, 115, 116, 117].

Prevention of Money Laundering Act, 2002 (PMLA) – ECIR – Addendums and Clubbing of FIRs – An ECIR, being an internal document, can be supplemented or updated via addendums as investigation progresses and new facts or scheduled offences emerge – The Supreme Court's consolidation of FIRs for police investigation (Grand Venice Project) does not extinguish the statutory character of individual FIRs for PMLA purposes, nor does it bar ED from investigating proceeds of crime from other distinct projects (Mist Avenue Project) which contain scheduled offences – The Court held that the inclusion of Mist Avenue FIRs through addendums was lawful and justified, as PMLA jurisdiction is transaction-based, not FIR-based – The Court relied on Amitbhai Anilchandra Shah v. CBI and Directorate of Enforcement v. Deepak Mahajan [Paras 28, 29, 47, 48, 49, 77, 78, 79, 80, 81, 82, 83, 84, 85, 86, 87, 88, 102, 103, 118, 119, 120, 121, 122, 123, 124, 125, 126, 127, 128, 129, 130, 131, 132, 133, 134, 135, 136, 137, 138, 139, 161, 166].

Decision: Appeal partly allowed – NBWs issued on 11.04.2025 are cancelled – ED directed to refrain from investigative measures qua consolidated Grand Venice FIRs until final adjudication of Criminal Misc. Application No. 25724/2022 or framing of charges in Case No. 1559/2019, or any final order by the competent court – ECIR not quashed in its entirety, remains operative for independent Mist Avenue FIRs – Petitioner directed to cooperate with ED upon prior written intimation [Paras 193, 199, 200].

Prevention of Corruption Act – Illegal Gratification – Proof of Demand and Acceptance Mandatory – Appellant, a police officer, was convicted under Sections 7 and 13(1)(d) read with Section 13(2) of the PC Act for allegedly accepting ₹10,000 as bribe to avoid arresting the complainant’s relative – Complainant (PW-7) turned hostile and denied having any direct interaction with the appellant – Panch witness (PW-8) gave contradictory testimony regarding raid and was unaware of crucial facts – Complainant’s friend (PW-11) also did not support the prosecution version – Held: Demand and acceptance not proved beyond reasonable doubt – Conviction unsustainable. Acquittal [Paras 5–16].

Criminal Trial – Hostile Witnesses – Effect – Complainant and other key witnesses failed to support the prosecution case – Their testimonies inconsistent and materially contradictory – Panch witness admitted he was unaware of facts and signed blank papers – Court held that prosecution failed to prove factum of demand and acceptance of gratification, which is a sine qua non for conviction under PC Act [Paras 5–15].

Burden of Proof – Demand and Acceptance – Standard Reiterated – Citing B. Jayaraj and Neeraj Dutta, Supreme Court decisions – Court reaffirmed that proof of both demand and acceptance is essential for conviction under Sections 7 and 13 of the PC Act – Mere recovery or possession of money is insufficient – Even circumstantial evidence must unerringly establish demand and acceptance [Paras 10–12].

Decision: Appeal allowed – Conviction and sentence set aside – Bail bond cancelled and surety discharged [Paras 17–19].

Negotiable Instruments – Cheque Dishonour – Financial Capacity – Section 138 NI Act – Accused issued cheque of Rs.5,00,000 which was dishonoured for insufficient funds – Trial Court acquitted accused holding complainant failed to prove her financial capacity to lend the money – Appellate Court held that unless accused disputes financial capacity with evidence, presumption under Section 139 operates – Held: Trial Court erred in doubting complainant’s capacity without any rebuttal by accused – Complainant’s explanation regarding source of funds from property sale found credible [Paras 9-10].

Presumption under NI Act – Section 139 – Accused did not rebut presumption – Accused neither entered witness box nor challenged issuance or signature of cheque – No defence evidence led – Held: Presumption under Section 139 NI Act remained unrebutted – Conviction proper [Paras 5, 11].

Criminal Procedure – Legal Notice – Notice returned as “Unclaimed” – Held: Due service presumed – Complaint filed within limitation – All conditions under Section 138 NI Act fulfilled – Accused did not respond to notice nor deny liability [Paras 8-9].

Compensation and Sentencing – Conviction under Section 138 NI Act – Fine of Rs.8,00,000 imposed – Rs.7,80,000 directed to be paid to complainant as compensation under Section 357A CrPC – In default, accused to undergo simple imprisonment for three months [Para 11, Order].

Decision: Appeal allowed – Acquittal set aside – Accused convicted under Section 138 NI Act – Fine of Rs.8,00,000 imposed – Rs.7,80,000 payable to complainant as compensation – Default sentence of three months’ simple imprisonment.

Writ Jurisdiction – Fraudulent Registration – Unilateral Deeds – Writ Petitions Maintainable – Appeal against quashing of registered deed of cancellation, deed of declaration, and gift deed executed by borrower without authority – Appellants argued alternative remedy and pendency of civil suits – Held: High Court rightly exercised writ jurisdiction considering the egregious fraud and abuse of legal process – Registration of cancellation/declaration by non-parties to assignment was impermissible – Senior Sub-Registrar’s actions found to be unlawful and without jurisdiction [Paras 6–7, 17–26, 30]

Property Law – Mortgage – Assignment of Debt – Borrower Cannot Unilaterally Cancel – ARCIL, as assignee of Indian Overseas Bank under a registered assignment agreement, acquired rights over mortgaged property – Borrower’s subsequent declaration and cancellation deeds purporting to void assignment were fraudulent and ultra vires – Gift deed based on such declarations also invalid – Held: Appellant had no right to nullify or override valid assignment and mortgage [Paras 7–13, 22–24]

Stamp Act – Impounding Without Notice – Action by Anti-Corruption Council – Abuse of Power – Senior Sub-Registrar impounded resolution plan executed between borrower and ARCIL based on submission by Anti-Corruption Council – No notice to ARCIL – Court held impounding illegal and violative of natural justice – Anti-Corruption Council’s locus and possession of private commercial documents unexplained – Apparent misuse of registration office [Paras 2–3, 20–22]

Administrative Law – Inquiry Against Public Officer – Senior Sub-Registrar’s Conduct – Court took note of memo by State Government confirming cancellation of registered documents and initiation of inquiry against Sub-Registrar – Future criminal proceedings contemplated – In light of action taken, Court refrained from further observations on official misconduct [Paras 27–29]

SARFAESI – Enforcement of Security Interest – Borrower’s Attempt to Derail Recovery – Despite ARCIL taking possession under SARFAESI, borrower executed false documents, initiated suits, and filed complaints to obstruct enforcement – High Court upheld ARCIL’s rights and struck down manipulative actions [Paras 8–11, 14–16]

Decision: Appeal dismissed – Order of Single Judge upheld – Cancellation, declaration, and gift deed rightly quashed – State inquiry into Sub-Registrar’s conduct ongoing – No costs – Pending applications disposed.

Criminal Law - Excise Offences – Illegal Possession and Transport of Liquor – Acquittal – Appellant convicted for transporting illicit liquor containing ethyl alcohol unfit for human consumption – Trial Court convicted under Sections 32 and 34 of Karnataka Excise Act – High Court finds prosecution failed to comply with mandatory provisions of Sections 53 and 54 of the Act and Section 102 CrPC – No search warrant, no timely production of seizure report or witness statements – Held: Violation of statutory safeguards renders search and seizure illegal – Conviction unsustainable [Paras 13-20].

Criminal Procedure – Seizure and FIR – Prosecution failed to submit seizure mahazar along with FIR or show compliance with Section 102 CrPC – Delay in submission of witness statements and non-production of search report before Magistrate undermines prosecution case – Trial court failed to consider these procedural lapses [Paras 17-18].

Evidence – Hostile Witness – Independent panch witness (PW4) turned hostile and denied signing seizure mahazar at the spot – Official witnesses’ testimony not corroborated by any independent witness – Held: Conviction cannot rest solely on interested testimony of official witnesses in absence of reliable independent corroboration [Paras 15, 19-20].

Precedent – Reliance on Apex Court Ruling – Court followed K.L. Subbaiah v. State of Karnataka, (1979) 2 SCC 115 – Held: Non-compliance of Section 54 of Karnataka Excise Act renders search without jurisdiction – Acquittal justified [Para 13].

Decision: Appeal allowed – Conviction and sentence set aside – Accused acquitted of offences under Sections 32 and 34 of Karnataka Excise Act – Fine, if paid, to be refunded [Para 21].

Tender Conditions – Judicial Review – Turnover Criteria – Challenge to Clause 5.2 of the tender document prescribing a minimum annual turnover of ₹9 crores for eligibility and awarding marks based on turnover brackets – Petitioner alleged the clause to be arbitrary, vague, and designed to favour a specific class of bidders – Held: Tender inviting authority justified the clause based on the scale of operations (1134-bedded hospital) and need for financial capacity to provide seamless service for 2–3 months without payment – Clause not found to be arbitrary or violative of Articles 14, 19(1)(g), or 21 – No interference warranted under Article 226 [Paras 1–2.2, 5–6, 13–15]

Level Playing Field – Discrimination and Arbitrary Conditions – Court reaffirmed that while State action in contractual matters is subject to judicial review, interference is limited to cases of manifest arbitrariness, mala fides, or absence of nexus with the object of the tender – Test of arbitrariness lies in whether the impugned condition furthers the objective sought or unfairly restricts competition – In present case, requirement of high turnover held to have rational nexus with the hospital's operational needs [Paras 6, 13–15]

Scope of Judicial Review – Tender and Contractual Matters – Courts cautioned against substituting administrative decisions made by expert bodies unless the action is arbitrary, biased, or lacks justification – Reliance placed on principles from Michigan Rubber, Master Marine Services, Balaji Ventures, and Subodh Kumar Singh Rathour – Procedural fairness ensured via pre-bid consultation – Petitioner’s objections duly considered [Paras 9–12.1]

Decision: Writ petition dismissed – Turnover clause upheld – No costs [Paras 16–17]

Motor Accident – Compensation – Quantum – Income Assessment – Tribunal assessed monthly income of deceased at ₹15,680 based on Deputy Commissioner’s wage notification for skilled labour – Appellant insurer contended income should have been computed as ₹8,245 per minimum wage notification – Held: Deceased held valid licence for heavy vehicles and was rightly treated as skilled labour – Deputy Commissioner’s wage notification applicable – No perversity or illegality in Tribunal’s approach – Tribunal’s award of ₹19,60,000 with 7.5% interest upheld [Paras 3–11].

Appellate Review – Scope – Interference by appellate court only if findings are perverse or arbitrary – Mere alternative view not sufficient – Citing Saroj & Ors. v. IFFCO-Tokio General Insurance Co., 2024 INSC 816, Court held that absence of contrary evidence justifies reliance on local wage notifications for income computation – Findings of Tribunal affirmed [Paras 6–9].

Decision: Appeal dismissed – Tribunal’s award upheld – Appellant Insurance Company entitled to refund of statutory deposit of ₹25,000 [Paras 12–13].

Criminal Law – Rape and Murder – Acquittal – Appellant convicted under Sections 376 and 302 IPC for allegedly raping and murdering a 13-year-old girl in a secluded area – Trial Court relied on extrajudicial confessions made before a co-villager (P.W.3) and a doctor (P.W.11) and on the appellant’s suspicious conduct at the crime scene – High Court finds that neither P.W.3’s testimony about the confession was reliable nor corroborated by prior police statements or other witnesses – Medical officer (P.W.11) did not record any confession in his report and his oral testimony contradicted documentary evidence – Confessional evidence not put to appellant under Section 313 Cr.P.C. – Held: Extrajudicial confession not reliable or admissible to base conviction [Paras 11–12].

Circumstantial Evidence – Guilt Not Proved – Prosecution case entirely based on circumstantial evidence – Appellant’s presence at crime scene explained plausibly and supported by hostile witness (P.W.7) – Forensic reports failed to find blood, semen, or saliva on appellant’s clothes or body – Court held that the chain of circumstances was incomplete and did not exclude every hypothesis of innocence – Conviction based on suspicion or conjecture unsustainable in law [Paras 13–15].

Medical Evidence – Cause of Death – Deceased died of asphyxia due to compression of neck, chest, and abdomen – Signs of recent violent sexual intercourse found – Though rape and homicidal death established, identity of perpetrator not conclusively proved [Paras 9].

Decision: Appeal allowed – Conviction and sentence under Sections 376 and 302 IPC set aside – Appellant acquitted – Bail bonds cancelled [Para 15].