Source: Karnataka High Court

Why in News?

Recently bench of Justice M Nagaprasanna of Karnataka High Court held that a bank cannot withhold a passport and Overseas Citizens of India (OCI) card as security for loan repayment.

What was the Background of the Case?

• An OCI card holder citizen of the United Kingdom was held under several provisions of the Indian Penal Code, 1860 (IPC) by Vijaya Bank which is now Bank of Baroda.
• The Bank stated that on 03^rd October 2018, the petitioner voluntarily committed to closing two housing loan accounts.
• When the petitioner did not fulfill the commitment, the Bank instructed him to surrender passport and OCI card.
• The petitioner contended coercion, asserting the Bank lacks authority over the UK-issued passport, and only the Ministry of External Affairs can act on the OCI card.
• The Bank refuted the claims, citing a paragraph in the undertaking where the petitioner agreed to deposit the passport willingly.

What is the Court’s Observation?

• The Karnataka High Court held that “The action of the Bank in retaining the British passport of the petitioner and the OCI Card is held to be illegal”.

Who are Overseas Citizens of India?

• About:
  • A person having Indian origin, but foreign citizenship is allowed to work and live in India for indefinite period.
  • It is an immigration status provided to foreign citizen of Indian origin.
  • It was made to meet the needs of dual citizenship.
  • The Overseas Citizen of India Scheme came in year 2005 by amending the existing Citizenship Act, 1995.
  • It was launched in 2006 on the occasion Pravasi Bharti Divas.
• Dual Citizenship Aspect:
  • OCI status is not dual citizenship. It is a form of permanent residency that provides certain benefits but does not grant the right to hold an Indian passport.
  • OCIs are encouraged to maintain and renew their passports from their country of residence.
• Eligibility for OCI Card:
  • The applicant must be a citizen of another country having an Indian origin or was citizen of India on or before the commencement of the Constitution; or
  • The applicant must be a citizen of another country, but was eligible for the citizenship of India at the time of the commencement of the constitution; or
  • The applicant must be a citizen of another country and belonging to a territory that became a part of India after the 15^th August 1947; or
  • The person is a child/grandchild/great grandchild of such a citizen; or
  • The person is a minor child, whose parents are both Indian citizens or one parent is a citizen of India and
  • The applicant is a spouse of foreign origin of an Indian citizen or of an OCI cardholder.
• Exceptions
  • A person who is not a citizen of any country is ineligible to become an OCI card holder.
  • Any person will be denied applying for the OCI card if his parents or grandparents are/were citizens of Pakistan and Bangladesh.