A Tamil family detained on Christmas Island and fighting deportation has been granted a 24-hour lifeline by the Federal Court.
A hearing in Melbourne on Wednesday failed to reach a resolution in the high-profile case of Priya and Nades Murugappan and their daughters Tharunicaa, two, and Kopika, four.
Federal government plans to return the family to Sri Lanka were put on hold by a previous injunction expiring at 4pm on Wednesday, with Justice Mordy Bromberg making orders stretching until 4pm Thursday.
Barrister Angel Aleksov argued on Wednesday that Australian-born Tharunicaa was legally entitled to make a visa application when "the bar was lifted" between July and August 2017, following a determination by Home Affairs Minister Peter Dutton.
That change lifted the usual limitation to apply for a visa under the Migration Act, which ordinarily deems that children of asylum seekers who arrive by boat are not entitled to refugee status.
A protection visa application was made for Tharunicaa last week, with Mr Aleksov arguing that bar should remain lifted to assess her right to stay in Australia.
But Stephen Lloyd, acting for the federal government, said the bar was only lifted temporarily and that no application was made during that time.
He conceded there was no evidence the family was notified they needed to "take advantage" of that window.
Mr Aleksov argued Tharunicaa did have a right to apply for a visa, that her matter is "still in train" and the government has no power to deport her to Sri Lanka with her family.
"It is a very serious question about whether my client has been lawfully detained," he said.
Mr Aleksov argued the minister should be required, and in fact had a duty, to consider Tharunicaa's claim, with the only issue being whether she was disqualified under legislation.
"It's accepted that if the applicant has made a valid application for a visa, there is not power to remove her until it is determined," Justice Bromberg said.
"This all turns on whether there was a power to remove ... because there was a statutory process still in place".
Mr Aleksov also argued if the family was deported, it was a "literally life or death" situation, but agreed there was no evidence before the court about their risk of serious harm in Sri Lanka.
The family had settled in the Queensland township of Biloela before being taken into detention, with Tharunicaa's parents and sister already refused refugee status in Australia.
Tamil Refugee Council representative Aran Mylvaganam said he had spoken to Priya and Nades from Christmas Island overnight, when they relayed their jail-like conditions, surrounded by guards.
"The circle of guards have been ordered by Australian Border Force to capture every moment of their stay there on video," he told AAP on Wednesday .
"It is creating some sort of fear."
Justice Bromberg is expected to deliver his decision on Thursday at 2.15pm on whether the matter proceeds to a "full and final" hearing and whether the family remains in Australia until that time.
Australian Associated Press