Sridhar Lagadapati vs Union Of India & Ors.

$~70
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ W.P.(C) 11023/2025
Date of Decision : 25.02.2026
IN THE MATTER OF:

SRIDHAR LAGADAPATI .....Petitioner
Through: Mr. Malak Bhatt, Ms. Neeha Nagpal,
Mr. Shreyansh Chopra, Advocates.

versus

UNION OF INDIA & ORS. .....Respondents

Through: Mr.Rohan Jaitley CGSC, Mr.Akshay
Sharma Adv, Mr.Dev Pratap Shahi
Adv, Mr.Varun Pratap Singh Adv,
Mr.Yogya Bhatia Advocates for UOI.
Mr.
Mr. Arun Aggarwal & Ms. Kajal
Ashok Mishra, Advocates for R-3.

CORAM:
HON'BLE MR. JUSTICE PURUSHAINDRA KUMAR KAURAV
J U D G E M E N T

PURUSHAINDRA KUMAR KAURAV, J. (ORAL)

The petitioner seems to be erstwhile Managing Director of Lanco
Infratech Limited (‘ LITL ’) and had relinquished his position in the year
2004. The petitioner claims that consequent to his resignation he was
inducted as a non-executive Director of LITL and was considered as a part
of ‘promoter group’ in terms of the Securities and Exchange Board of India
Signature Not Verified
Signature Not Verified
Signed
By:PURUSHAINDRA
KUMAR KAURAV
Signed By:AMIT KUMAR
SHARMA
Signing Date:27.02.2026
14:56:20
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(Issue of Capital and Disclosure Requirements) Regulations, 2009. The
petitioner claims to have started his own entertainment business between the
years 2004 to 2006.
2. In the year 2017, the National Company Law Tribunal (‘ NCLT’ ),
Hyderabad Bench admitted a petition and ordered commencement of CIRP
proceedings against LITL. In interregnum, the Ministry of Corporate
Affairs also directed investigation by respondent no.2 into the affairs of
LITL.

3. It, however, remains undisputed that till date no FIR, Charge-sheet or
complaint has been registered against the petitioner. The petitioner is not
required by any of the investigating agencies. The investigation initiated by
the Serious Fraud Investigation Office (‘ SFIO ’) has also been closed against
the petitioner. The sole basis for issuance of Look Out Circular (‘ LOC’ ) is
the request by the financial institutions.
1
4. The Court in the case of Vineet Gupta vs. Union of India , has held
that the LOC at the instance of Chairman, Managing Director or Chief
Executive Officer of the Public Sector Banks would not stand the scrutiny of
law. In the paragraph no. 28 of the said judgment the Court has held as
under:
“ 28. On the conspectus of the aforenoted decisions and memorandum, it is
seen that the following guiding principles emerge governing the issuance,
continuance, and judicial review of LOC:
(i) LOC constitutes a coercive executive measure having a
substantial impact on the fundamental right to travel, which forms
an integral facet of the right to life and personal liberty guaranteed
under Article 21 of the Constitution of India. Consequently, the
power to issue an LOC must be exercised sparingly, strictly in
accordance with law, and only upon satisfaction of the conditions

1
2026 DHC 1616
Signature Not Verified
Signature Not Verified
Signed
By:PURUSHAINDRA
KUMAR KAURAV
Signed By:AMIT KUMAR
SHARMA
Signing Date:27.02.2026
14:56:20
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prescribed under the governing Office Memoranda;
(ii) An LOC may be issued only in cases involving a cognizable
offence under the relevant statutes, where specific, tangible
material demonstrates that the person concerned is deliberately
evading arrest or judicial process, or that there exists a real and
proximate likelihood of absconding;
(iii) Moreover, the exceptional power under Clause 6 (L) of the
Office Memorandum dated 22.02.2021 is to be narrowly construed
and may be exercised only in rare and compelling cases, where,
the proposed departure of subject poses a clear and grave threat to
the sovereignty, security, or integrity of India, or to its strategic or
economic interests in a national or systemic sense, or the larger
public interest;
(iv) An LOC issued at the instance of Chairman, Managing
Director, or Chief Executive Officers of Public Sector Banks,
would not withstand the scrutiny of law and judicial review. Thus,
as of now, the LOC issued to Public Sector Banks cannot be
sustained and are liable to be quashed;
(v) Courts, in exercise of writ jurisdiction, are duty-bound to
subject the issuance and continuation of LOCs to strict scrutiny,
balancing the legitimate interests of the State with the individual‟s
fundamental rights, and to quash such circulars where the restraint
imposed is found to be arbitrary, disproportionate, lacking in
statutory backing, or violative of the principles of fairness,
reasonableness, and due process. Ultimately, the burden lies
squarely upon the “originating agencies” to justify, the necessity,
proportionality, and legality of the restraint, failing which such
action cannot be sustained. Pertinent to observe that the
continuance of an LOC is not indefinite and must be periodically
reviewed. Where it is evident from the record that the subject has
cooperated with the investigation, has not evaded the process of
law, and where no further interrogation or presence is
demonstrably required, the continued operation of an LOC would
amount to an unreasonable and unjustified restriction on personal
liberty;
(vi) However, it is also to be emphasised herein that the Writ Court
is not the exclusive grievance redressal mechanism available to a
person against whom a LOC has been issued. As held in Sumer
Singh Salkan, a person against whom a LOC is issued is, in the
first instance, required to join the investigation or surrender before
the jurisdictional Court, or otherwise satisfy the Court that the
LOC is unwarranted. The individual may also approach the
authority which ordered issuance of the LOC and seek its
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Signature Not Verified
Signed
By:PURUSHAINDRA
KUMAR KAURAV
Signed By:AMIT KUMAR
SHARMA
Signing Date:27.02.2026
14:56:20
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withdrawal on the grounds of illegality or non-application of mind.
An LOC may be withdrawn by the originating authority and may
also be rescinded or modified by the trial Court or the Court
having jurisdiction over the concerned police station, upon an
appropriate application.”

5. In view of the overall facts and circumstances, there is no reason to
allow the LOC to remain in existence and, accordingly, the same stands set
aside.
6. The security, if any, deposited by the petitioner be refunded by the
concerned Registrar upon due verification to the petitioner or to the
representative, duly authorized by the petitioner.
7. With the aforesaid, the petition, along with pending applications,
stands disposed of.

PURUSHAINDRA KUMAR KAURAV, J
FEBRUARY 25, 2026
aks/ss.





Signature Not Verified
Signature Not Verified
Signed
By:PURUSHAINDRA
KUMAR KAURAV
Signed By:AMIT KUMAR
SHARMA
Signing Date:27.02.2026
14:56:20
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