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ILR can be cancelled while holder is outside the UK
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The Home Secretary does have the legal power to cancel someone’s indefinite leave to remain after all, the Court of Appeal has held. The decision in R (C1) v Secretary of State for the Home Department (Rev1)  EWCA Civ 30 reverses the tentative conclusion of Mr Justice Jay last year.
There is very little information about the anonymous appellant; the case seems to be national security related. C1 had indefinite leave to remain in the UK. He left the country in 2018 and went to Iran. While he was abroad, the Home Secretary personally ordered his ILR to be cancelled and C1 excluded from the UK.
Article 13(7) of the Immigration (Leave to Enter and Remain) Order 2000 says:
Where a person is outside the United Kingdom and has leave which is in force by virtue of this article, that leave may be cancelled:
(b) in the case of leave to remain, by the Secretary of State.
The question for the court was whether “leave to remain” includes indefinite leave to remain. Jay J had “reluctantly” (his own word) agreed that it did not, and so the Home Secretary’s purported cancellation of C1’s ILR had no legal effect.
The Court of Appeal found otherwise:
Section 3B of the 1971 Act authorises a power, and article 13(7) of the Order confers a power, to cancel both limited and indefinite leave to remain which are in force by virtue of article 13.
Those interested in the reasoning can gorge themselves on the 94 paragraphs that follow.