India News | Delhi HC Quashes ED Lookout Circulars Against Sanjay Dangi, Amit Dangi in Reliance Finance Probe
Get latest articles and stories on India at LatestLY. The Delhi High Court has quashed the lookout circulars (LOCs) issued against Sanjay Dangi and Amit Dangi at the instance of the Enforcement Directorate (ED) in connection with its money laundering investigation into alleged financial irregularities involving Reliance Commercial Finance Limited (RCFL) and Reliance Home Finance Limited (RHFL).
New Delhi [India], October 18 (ANI): The Delhi High Court has quashed the lookout circulars (LOCs) issued against Sanjay Dangi and Amit Dangi at the instance of the Enforcement Directorate (ED) in connection with its money laundering investigation into alleged financial irregularities involving Reliance Commercial Finance Limited (RCFL) and Reliance Home Finance Limited (RHFL).
Justice Madhu Jain, in an order dated October 16, held that the continued operation of the LOCs was not warranted in view of the petitioners’ cooperation with the investigation and the absence of adequate justification for preventing them from travelling abroad.
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The court observed that the pendency of further investigation, by itself, could not justify an indefinite restriction on a person’s right to travel abroad, which forms part of the fundamental right to personal liberty under Article 21 of the Constitution.
“Continuation of the impugned LOC for an indeterminate period, despite his compliance with the process issued to him, would consequently be shockingly disproportionate,” the court said while dealing with Sanjay Dangi’s petition.
The court clarified that its findings did not determine the merits of the allegations under investigation and would not prevent the ED from proceeding in accordance with law if fresh material or changed circumstances warranted further action.
Allowing the two petitions, the court directed both petitioners to furnish affidavits to the ED within one month, undertaking to cooperate with the investigation, appear in response to lawful summons and produce documents or material within their possession, custody or control as lawfully required.
They have also been directed to intimate the investigating officer by email before undertaking foreign travel, providing their complete itinerary, including destinations, departure and return dates, flight details, addresses of stay and contact particulars abroad.
The court specifically clarified that the requirement was only one of prior intimation and did not require either petitioner to obtain the ED’s permission to travel abroad.
The petitioners must promptly communicate material changes to their itineraries, return in accordance with the itinerary furnished or updated, and remain accessible to the investigating agency during their travels.
The court further directed the ED to communicate the judgment to the Bureau of Immigration, which must give effect to the quashing of the LOCs and update its records accordingly.
The court noted that Sanjay Dangi had appeared in response to all summons issued to him and that no instance of his evading the investigation or failing to appear had been pointed out. He had neither been named as an accused nor cited as a witness in the prosecution complaint filed by the ED.
The ED had argued that further investigation into his role was continuing and that material gathered during the probe required further examination. It also relied on allegations concerning the resolution process and subsequent transactions involving the two finance companies to contend that cancellation of the LOC would be premature.
However, the court found that the agency had not identified circumstances demonstrating how Sanjay Dangi’s departure from India, despite his cooperation, would frustrate the investigation or be detrimental to India’s economic interests or the larger public interest.
The court said the ED’s description of him as a flight risk had to be supported by circumstances relevant to that apprehension. The fact that further investigation was required did not, by itself, establish the necessity of keeping him in India indefinitely.
It also considered the ED’s submission regarding a complaint by Bank of Baroda to the CBI concerning the resolution process. The court observed that the complaint might require examination by the investigating agencies, but the need to ascertain its status did not establish that Sanjay Dangi must remain in India until that exercise was completed.
The court made clear that it was not assessing the sufficiency of the evidence for further proceedings or expressing any opinion on the allegations against him.
With regard to Amit Dangi, the court noted that he had not been named as an accused in the predicate FIRs, the CBI charge sheet or the ED’s prosecution complaint. He had instead been cited as prosecution witness No. 130.
The court also took note of the ED’s own submission before the Bombay High Court that Amit Dangi had appeared on eight occasions pursuant to three summons and that his statements had been recorded.
Significantly, the ED had stated in its counter-affidavit before the Delhi High Court that it was not opposed in principle to his petition and that he could be permitted to travel abroad subject to conditions intended to secure his continued cooperation and availability.
The proposed safeguards included an undertaking to cooperate, production of documents when lawfully required, advance disclosure of travel itineraries and continued accessibility to the investigating agency.
The court held that Amit Dangi’s presence might be required for further investigation or for giving evidence before the Special Court, but his status as a prosecution witness did not require him to remain in India throughout the pendency of the proceedings.
It concluded that his acknowledged cooperation, read with the ED’s own stand on conditional travel, supported quashing the LOC subject to safeguards.
The petitions arose from investigations into alleged financial irregularities in RCFL and RHFL during 2017-2019, when the companies were under their erstwhile management.
The CBI registered two FIRs on September 19, 2022, in relation to the finance companies, alleging offences including criminal conspiracy and cheating. Neither Sanjay Dangi nor Amit Dangi was named as an accused in those FIRs.
Authum Investment and Infrastructure Limited subsequently acquired RCFL through a resolution process. An identified business undertaking of RHFL was also transferred to RCFL in March 2023.
The ED recorded an Enforcement Case Information Report (ECIR) on July 22, 2025, based on the scheduled offences arising from the CBI cases. It conducted searches at premises connected with Authum and the petitioners and issued summons under the Prevention of Money Laundering Act (PMLA).
A combined charge sheet in the two CBI cases was filed before the Special CBI Court in Mumbai in September 2025, without naming either petitioner as an accused.
The ED subsequently filed a prosecution complaint before the Special PMLA Court at Rouse Avenue in Delhi in June 2026. Neither petitioner was named as an accused in that complaint.Amit Dangi was cited as a prosecution witness, while Sanjay Dangi was not cited as a witness.
The ED opposed the quashing of the LOCs, contending that the investigation remained ongoing and that the restrictions were necessary to protect the country’s economic interests and ensure the petitioners’ availability.
The High Court, however, held that the justification for restricting foreign travel had to be assessed with reference to the individual concerned and the applicable LOC guidelines. It clarified that its decision would not impede the ongoing investigation or any proceedings before the competent court.
The court accordingly allowed both petitions and quashed the LOCs, subject to the conditions specified in its order. (ANI)
(The above story is verified and authored by ANI staff, ANI is South Asia's leading multimedia news agency with over 100 bureaus in India, South Asia and across the globe. ANI brings the latest news on Politics and Current Affairs in India & around the World, Sports, Health, Fitness, Entertainment, & News. The views appearing in the above post do not reflect the opinions of LatestLY)