In WRIT PETITION NO.2826 OF 2022-BOM HC-Debt Recovery Tribunal has no power to restrain citizen from travelling abroad, particularly when said right is recognized as facet of Article 21 of Constitution: Bombay HC Justices Amit Borkar & A.S.Chandurkar [07-06-2022]

Read Order: ANURAG S/O PADMESH GUPTA Vs. BANK OF INDIA TH. IT’S ASSISTANT GENERAL MANAGER. 

Mansimran Kaur

New Delhi, June 8, 2022: While observing that Section 22 of the Recovery of Debts Due To Banks and Financial Institutions Act, 1993, confers the procedural right to regulate proceedings before it, the Delhi High Court has opined that in the absence of a specific provision conferred on the Debt Recovery Tribunal by statute, the Debt Recovery Tribunal has no power to restrain a citizen from travelling abroad, particularly when the said right has been recognized as a facet of Article 21 of the Constitution of India.

The Division Bench of Justice Amit Borkar and Justice A.S.Chandurkar was of the opinion that the restraining order passed by the Debt Recovery Tribunal in the instant case curtailing the right of the petitioner to travel abroad was beyond its jurisdiction. 

The factual matrix of the case was such that the petitioner was a personal guarantor of a private limited company engaged in electricity and power generation. To establish the power plant, a consortium led by Axis Bank Limited and another group of lenders, namely L & T Infrastructure Finance, State Bank of Mysore, Corporation Bank, State Bank of India and the first respondent, collectively financed the said project.  Proceedings under the Insolvency and Bankruptcy Code, 2016 were lying sub judice with respect to the second respondent- Company before NCLT, Mumbai and the same was under liquidation. 

Thereafter, original application was filed before the Debt Recovery Tribunal Nagpur, for recovery of amount against the petitioner and other directors of the second respondent- company for a sum of Rs.110,15,00,000. In the said application, the first respondent- Bank sought interim relief for restraining the petitioner from travelling abroad and for impounding the passport of the petitioner. In pursuance of the same, the Debt Recovery Tribunal passed the  restraining order . The same was assailed by the petitioner, and he filed an application before the Debt Tribunal Nagpur but the said application was dismissed by the Tribunal. Thus, the petitioner assailed the aforesaid order by way of present writ petition. 

Referring to Article 21 of the Indian Constitution, the Court observed that it is a settled proposition of law that the expression “personal liberty” includes a right of citizens to travel abroad and to return to their home country without any impediment, direct or indirect. With respect to the same, the Court observed that if the right to travel abroad is a part of the personal liberty of the person, he certainly cannot be deprived of the same except procedure established by law. It was also observed by the Court that the right to travel abroad is distinct and separate from the right of freedom of movement in a foreign country. In furtherance of the same, the Court further observed that the right to travel abroad is distinct and separate from the right of freedom of movement in a foreign country. The right to travel abroad by its necessary implications means the right to leave the home country and visit a foreign country, the Court noted. 

Reliance was placed on the judgments in Satwant Singh Sawhney Vs. D. Ramarathnam, Assistant Passport Officer, New Delhi and Smt. Maneka Gandhi vs. Union of India. In addition to the aforesaid observations, the Court also considered the relevant provision of the Recovery of Debts Due To Banks and Financial Institutions Act, 1993 and  opined that the language of Sections 12, 13(A), 17 and 18 of Section 19 reflect that the Tribunal was not conferred with the power to restrain a person from leaving the country. 

The Bench asserted, “In our view, Section 22 confers the procedural right to regulate proceedings before it. In the absence of a specific provision conferred on the Debt Recovery Tribunal by statute, the Debt Recovery Tribunal has no power to restrain a citizen from travelling abroad, particularly when the said right has been recognised as a facet of Article 21 of the Constitution of India. In our view, the provisions under the Recovery of Debts Due To Banks and Financial Institutions Act, 1993, as they stand, do not even impliedly confer such powers on the Debt Recovery Tribunal to restrain a person from travelling abroad.” Affirming that the Debt Recovery Tribunal had no power to restrain a person from travelling abroad in the absence of specific powers to that effect, the Bench allowed the petition.