What are Look Out Circulars (LOCs)?


10:31 AM

1 min read
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The Bombay High Court recently held that public sector banks (PSBs) cannot recommend or request the issuance of Look Out Circulars (LOCs) against loan defaulters.

About Look Out Circulars (LOCs):

  • A LOC is an instrument issued by the government as a directive to its immigration authorities to restrict and regulate the physical movement of a person. 
  • The immigration department is tasked to stop any such individual against whom such a notice exists from leaving or entering the country.
  • Law enforcement agencies often use LOCs as a coercive measure to stop any individual wanted or under suspicion by the police or an investigating agency from leaving or entering the country through designated land, air, and sea ports.
  • LOCs are usually issued by the police, intelligence agencies, or other government agencies authorised by the Ministry of Home Affairs (MHA). 
  • LOC does not have express statutory backing in legislation, the power to issue LOCs and their regulation stems from the executive in the form of an Office Memorandum issued by the MHA in 2021, which provides consolidated guidelines for opening LOCs against Indian citizens or foreigners.
  • Guidelines:
    • The guidelines categorically provide that LOCs can only be opened in criminal or penal cases, and the reason for the LOC must be indicated with the issue of the circular. 
    • If there is no criminal or penal case pending, the LOC cannot be issued, and agencies can only request that they be informed of departure or arrival.
    • However, the guidelines provide that in exceptional cases, an LOC may be issued against an individual even when the case is not a criminal case. This is in specified circumstances, such as when it is detrimental to the “sovereignty, or security, or integrity of India”, the “bilateral relations with any State”, or to the “strategic and economic interests of India”.
    • LOCs are also permitted in cases where the individual is likely to engage in terrorism or offences against the State or when such departure would not be “in the larger public interest”.
    • LOCs cannot be issued unless basic details — including name/parentage, passport number, and date of birth — are available, and such requests must be constantly monitored.
    • It is the responsibility of the originator to constantly review the LOC requests and proactively provide additional parameters to minimise harassment to genuine passengers.
    • It is also required that any LOC issued must be reviewed on a quarterly and annual basisby agencies that request such restrictions, and the result of the review must be informed to the MHA.
    • MHA has categorically transferred the legal consequences of issuing an LOC to the originating agency, even though such OMs are issued by the Bureau of Immigration.
    • The power to issue such OMs and LOCs is sourced from The Passports Act, 1967, the key legislation for the grant of passports, travel documents, and “endorsements” to travellers at the time of emigration or immigration.

Q1: What is Immigration?

Immigration is the process of moving to a new country or region with the intention of staying and living there. People may choose to immigrate for a variety of reasons, such as employment opportunities, to escape a violent conflict, environmental factors, educational purposes, or to reunite with family. Business travelers and foreign students, for example, typically do not qualify as immigrants even though they spend time in a foreign country.

Source: Why High Court said banks can’t stop debtors from going abroad