The Calcutta High Court has recently delivered a significant judgment reinforcing the power of investigating agencies to restrict the international travel of individuals involved in large-scale corporate frauds. Justice Krishna Rao, while dismissing a writ petition, held that the "Right to Travel" abroad is not an absolute right, especially when an individual is a settled resident of a foreign country and there is a credible risk of them evading the law in a multi-crore economic offence.
The Court’s decision came in the case of Debanjan Hazra v. Serious Fraud Investigation Office & Ors., where the petitioner challenged a Look Out Circular (LOC) issued against him by the Serious Fraud Investigation Office (SFIO).
The matter originates from a massive investigation into the affairs of Elder Pharmaceuticals Limited. The Ministry of Corporate Affairs had ordered the SFIO to probe the company under Sections 212 and 217 of the Companies Act following allegations of serious financial irregularities.
According to investigation reports, nearly ₹1,300 crore was allegedly siphoned off from the company, leaving over 23,000 public deposit holders in the lurch. The SFIO’s investigation suggested that the petitioner, Debanjan Hazra—a chemist who worked with the firm between 2006 and 2009—played a pivotal role in the money-laundering trail.
The authorities alleged that Hazra was closely associated with the promoters and was the sole shareholder of a foreign entity. It was claimed that two overseas subsidiaries were fraudulently transferred to his entity, resulting in the diversion of approximately ₹215 crore.
Debanjan Hazra, who has been living and working in China since 2013 and is married to a Chinese national, approached the High Court after being intercepted at the Kolkata airport while trying to travel to Bangladesh in December 2025.
His legal counsel argued that:
- He was merely an employee and had no hand in the management or the alleged fraud.
- The LOC violated the Ministry of Home Affairs' Office Memorandum, which suggests such drastic measures should only be used in "exceptional cases" or for cognizable offences.
- The restriction on his travel violated his fundamental right under Article 21 of the Constitution.
- He was not a "flight risk" as he occasionally visited India to meet his elderly parents.
The Union Government and the SFIO strongly opposed the petition. They informed the Court that Hazra had been consistently non-cooperative. Summons sent to his Indian address were returned unserved, and emails sent to him went unanswered.
The SFIO highlighted that even after being stopped at the airport and giving an undertaking to provide necessary documents, the petitioner failed to do so. They argued that since the petitioner is a permanent resident of China, allowing him to leave India would make it nearly impossible to secure his presence once formal prosecution begins in the Special Court.
Justice Krishna Rao, after examining the records, noted that the scale of the fraud was immense and affected thousands of innocent investors. The Court observed that while the right to travel is a fundamental right, it is subject to "reasonable restrictions" when the economic interests of the country are at stake.
The Court made several key observations:
- Flight Risk is Real: Since the petitioner has no permanent roots in India and has already settled in China, there is a "tangible apprehension" that he will not return to face trial.
- Non-Cooperation: The fact that the petitioner did not respond to summons or provide documents even after being intercepted weighed heavily against him.
- Economic Interest of India: The Court emphasized that in cases involving huge public money and siphoning of funds to foreign jurisdictions, the investigating agency is justified in using the LOC to prevent the accused from leaving the country.
Distinguishing this case from other precedents where LOCs were quashed, the High Court noted that in those instances, the individuals usually had deep roots in India. In Hazra's case, his permanent settlement abroad made him a high-risk individual.
"If prosecution is initiated based on the SFIO report and summons are issued by the Special Court, there is every chance that the petitioner will not appear," the Court remarked.
Concluding that the LOC was neither arbitrary nor illegal, the Court dismissed the writ petition, allowing the SFIO to continue its restriction on the petitioner's travel to ensure he remains available for the upcoming legal proceedings.
This judgment serves as a stern reminder to professionals and corporate employees associated with financial entities. It clarifies that "settling abroad" cannot be used as a shield to escape investigations in India. For the SFIO, this is a major win in its effort to recover funds and hold individuals accountable in the ₹1,300 crore Elder Pharma scam.
Case Details:
- Case Title: Debanjan Hazra v. Serious Fraud Investigation Office & Ors.
- Case No.: WPA 2772 of 2026
- Court: Calcutta High Court
- Bench: Justice Krishna Rao