Delhi High Court Refuses To Restore LOC Against SSK Trading Directors In Bank Fraud Case

On 4 June, the Delhi High Court dismissed Bank of Baroda's appeal and upheld a 21 January 2026 order of a Single Judge that had quashed a Look Out Circular (LOC) issued against Surender Kumar Bansal and another director of SSK Trading Pvt. Ltd. in a bank fraud and loan default case, subject to conditions requiring them to cooperate with the criminal trial and obtain prior permission before travelling abroad.

A Division Bench of Chief Justice Devendra Kumar Upadhyaya and Justice Tejas Karia found that the safeguards imposed by the Single Judge adequately protected the interest of the prosecution and therefore refused to interfere with the order quashing the LOC. The Court observed:

“Having regard to the overall facts and circumstances of the case, we are of the opinion that adequate safeguards are available, which has been strengthen by the directions issued by learned Single Judge while passing the impugned order, in case respondent nos. 1 and 2 intend to travel abroad. It is needless to observe that power to issue an LOC is an exceptional coercive measure, which has a direct bearing on an individual's fundamental right to travel and, therefore, such power has to be exercised with great care and caution and only in exceptional circumstances.”

The case arose from loan facilities granted by a consortium of banks, including Bank of Baroda, to SSK Trading Pvt. Ltd., where Surender Kumar Bansal and another respondent served as directors and personal guarantors. After the account turned into a non-performing asset, the Debt Recovery Tribunal initiated recovery proceedings.

Following a complaint by the lead consortium bank, the Central Bureau of Investigation registered an FIR on 12 April 2018 against the directors and later filed a charge sheet, with the criminal trial pending before the Rouse Avenue Courts.

Authorities issued an LOC on 3 January 2020 and later renewed it. The respondents challenged the LOC before the High Court. The Single Judge, by order dated 21 January 2026, quashed the LOC while directing them to cooperate with the trial, seek prior permission before travelling abroad, and permitting authorities to seek revival of the LOC in case of any violation.

The High Court reiterated that an LOC restricts the fundamental right to travel abroad and can be issued only in exceptional circumstances, as recognised in Rajesh Kumar Mehta v. Union of India and Maneka Gandhi v. Union of India. It also noted that the respondents had not misused the liberty granted to them for foreign travel and found no ground to interfere with the Single Judge's order. The judges held:

“Having regard to the facts of the case and antecedents of respondent nos. 1 and 2 that there has not been even a single instance of misuse of the liberty granted to them to travel abroad by the Court, we are of the opinion that there is no good ground which can be said to be made out in this appeal so as to call for any interference by us in the impugned order passed by the learned Single Judge.”

Accordingly, the High Court dismissed Bank of Baroda's appeal and upheld the quashing of the LOC, subject to the conditions imposed by the Single Judge.