Pending tax case not necessarily ground to restrict foreign travel: Bombay High Court

The Bombay High Court recently held that the mere pendency of a tax evasion case against a person is not necessarily a ground to restrict the accused person from travelling abroad [Sruti Vijaykumar v. Falgun Yogendra Shroff and anr].

A Bench of Justice SM Modak made the observation while refusing to restrain a furniture businessman facing allegations of customs duty evasion from travelling abroad.

"It is true right to travel abroad is recognized as a fundamental right. Merely because a person is facing with prosecution, it does not mean that he cannot travel abroad till the time the investigation is under progress or criminal case is pending," the Court said in its September 3 ruling.

The accused man, Falgun Yogendra Shroff, had been booked by the Directorate of Revenue Intelligence (DRI), Mumbai, for offences under Sections 135(1)(a) and 135(1)(b) of the Customs Act. He was accused of trying to evade customs duties while importing furniture.

He was arrested by the DRI but later released on bail by an Additional Chief Judicial Magistrate, subject to the condition that his passport be surrendered for six months from the date of arrest, which he complied with. He was also told to get permission from the trial court before he travelled abroad during the pendency of this case.

Later, Shroff moved an application for permission to travel abroad to attend a furniture fair in Paris. Despite objections from the DRI, the trial court allowed his request.

This order was challenged before the High Court by way of a writ petition. The petitioner raised concerns that if the accused is allowed to travel, it could lead to tampering with evidence. It was also argued that a plea to cancel the bail granted to the accused man is yet to be decided.

Shroff's counsel defended his client’s right to travel abroad, emphasizing that it was a fundamental right.

The Court noted that in such matters, the rights of the investigating agency have to be balanced with the rights of an accused person to travel in India and abroad.

The High Court eventually upheld the trial court's decision to allow the Shroff to travel abroad.

"Even I am of this opinion that mere because investigation is going on, the Respondent No.1 cannot be restrained from attending international furniture fair. Already the learned Magistrate has directed Respondent No.1 to deposit cash surety of Rs.2 lacs with condition to claim refund. One does not know how much time will be taken for hearing of application for cancellation of bail. It is scheduled for hearing on 11th September 2025 whereas till the time of hearing the fair will be over. The permission is granted (to travel abroad) from 4th September 2025 till 10th September 2025," the Court said.

The Court also suggested that Shroff could undertake not to contact any exporters while he is travelling, to address concerns that he may tamper with evidence if he travels abroad.

The Court ordered Shroff to give this undertaking to the trial court before he left India to attend the furniture fair.

Senior standing counsel Shyamrishi R Pathak briefed by advocates Ganesh Singh, and Jyoti Borai appeared for the petitioner.

Advocates Dr. Sujay Kantawala, Bhushan Shah, Akash Jain, Aishwarya Kantawala, Mohd. Lokandwala, Jeffry Caleb, Ayushi Jha, Gaurav Ekekar briefed by Mansukhlal Hiralal & Co. represented the Shroff (accused/ respondent).

Additional Public Prosecutor AS Gawai appeared for the State.

[Read Order]