The present policy of not allowing a foreign carrier to hold stake in domestic airlines has put a question mark on Virgin Atlantic chief Richard Branson's plans to acquire equity in private Indian airline companies.

"We are visualising a hypothetical situation where an investment needs to be scrutinised (as to) whether it conforms to the guidelines or not. Every case of foreign investment would be subjected to due scrutiny," Civil Aviation Secretary Ajay Prasad told reporters when asked about Branson's announcement that he was in talks with some existing private carriers as well as those groups intending to set up one in India.

Asked about Branson's proposal in view of the Virgin Group's varied business interests, including mobile phones, health clubs, hotels and hospitality, he said it would have to be ascertained as to whether such investment in the airline industry is 'a surrogate investment or a legitimate one.'

"If a person has a number of business interests and desires to invest in one capacity, it need not be considered as an investment by an airline," Prasad, however, said.

Branson had on Saturday announced plans to pick up stake in the existing Indian carriers or invest in launching new ones.