Hi all, this is What a lawyer said regarding my situation. Comments needed please. I think the lawyer is missing something out. (sushdmehta please I need your comment) :
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Lawyers comments below
To be clear you are on 3c leave when appealing the decision to refuse by the Home office, as this is a continuation of the same decision, and a decision which can be challenged. ( a final decision on that case has not been taken) In essence you are still on a tier 2 Visa, but with the conditions that were in place for the last grant of tier 2. This will remain the position until such time as you either succeed on ILR or god forbid it is refused and appeals right exhausted.
There is no issue in changing categories for 3c leave purposes, but until the next VISA is granted, the previous VISA is continued.
As for curtailment, this does not apply here, as you have made in time applications each time. Your VISA cannot be curtailed, but the variation can be refused as you will by withdrawing your appeal AND ARGUABLY precluding yourself from the HO being able to curtail your leave, so at the point you submit letter withdrawing appeal, my view, and that of counsel ( advocate) is that it would be dangerous, if not negligent to withdraw the appeal. That is unless we can get it in writing from the HO that for the purposes of the 10 year route they will not consider it as a period of overstaying.
I have spoken to an advocate and they both agree that this is treading on dangerous water, and by withdrawing appeal, even they cannot give a definitive answer. If however you allow the appeal to proceed, and at the end of becoming appeals right exhausted, as you have not withdrawn the appeal, the HO would then have to allow a further period for you to voluntarily leave the country at which time you could apply
Hope this helps.