The Bombay High Court on Tuesday questioned the Serious Fraud Investigation Office (SFIO) on the legal basis for downgrading a lookout circular (LOC) issued against Shikha Kapadia, who is under investigation in connection with a fraud case from 2019.
The bench, comprising Justices Revati Mohite Dere and Manjusha Deshpande, was deliberating on a petition by Kapadia, who sought the quashing of the LOC issued in September 2019 after the SFIO began investigating her and her employer, CG Power and Industrial Solutions Limited.
Advocate S K Halwasia, representing the SFIO, informed the court of the decision to downgrade the LOC, allowing Kapadia to travel without the need for prior permission. “The immigration officers will inform the SFIO every time she travels,” Halwasia stated.
This prompted the court to inquire about the legal foundation for such a downgrade. “Show us any circular, provision, or guideline that permits such a downgrade. We have not come across any such provision,” the bench remarked, expressing its unfamiliarity with the concept of LOC downgrading.
The matter has been scheduled for further hearing next week, with the court directing an SFIO officer to be present, either in person or via video-conference.
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Kapadia, in her plea, described the LOC as arbitrary, illegal, and an abuse of the legal system. She served as the company secretary and compliance officer for CG Power and Industrial Solutions Limited, which was accused of fraudulent transactions in 2019, leading to the issuance of the LOC.
Aniket Nikam, Kapadia’s lawyer, noted that the SFIO had previously been ordered to present a copy of the LOC but had failed to do so. The bench has now directed the SFIO to produce the document at the next hearing.
