Madhya Pradesh High Court junks Rs 50 crore travel abroad rider, says DRT lacks power

The court was hearing the plea of one, Rajeev Soni, former director of Metalman Industries, which was declared a non-performing asset for defaulting loan. Subsequently, Soni, co-guarantor to the loan, received a job offer in the US and sought permission from DRT to travel abroad.

While granting permission, the tribunal imposed a condition of depositing Rs 50 crore or an equal amount of surety in the form of immovable property.

Referring to the decisions of different high courts, Justice Verma reiterated that the right to travel abroad is a fundamental right guaranteed under Article 19 and 21 of the Constitution of India and pointed out that no person can be deprived of their right to travel except according to the “procedure established by law”.

The court also mentioned that “law would mean ‘Enacted Law’ or ‘State Law’.

Justice Verma accordingly remarked, “Since there is no such enacted law or state law, the DRT has no jurisdiction to deprive a person of his right to go abroad”.

On the issue of an alternate remedy, the court clarified that “entertaining a petition despite availability of an alternate remedy is a rule of discretion and despite such remedy a petition can be entertained inter alia if it is in respect of violation of fundamental rights of a person.”

Arguments

The state’s counsel, Sanjay Pathak, argued the imposed condition was “perfectly justified”, pointing out that Soni was liable to pay a huge amount to the Bank, hence he cannot be permitted to travel abroad, and in case he did so, there was every possibility of his not returning.

Pathak also submitted that Soni was earlier directed by a 2018 order to deposit Rs 1 crore, but he did not comply with it.

On the contrary, senior advocate Ravindra Singh Chhabra, representing Soni, argued that the DRT’s imposed conditions violated his client’s fundamental rights under Article 19(1)(g) and Article 21 of the Constitution of India.

He also stated the condition as “arbitrary, illegal and unreasonable on his client’s free movement abroad and adversely affecting his livelihood and employment.”

He further contended that the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 did not have any provisions which grant power to impose conditions for the purpose of ‘granting permission to travel abroad’.