M/S Gahna Jewelers Through Its Proprietor Sharad Mangal vs. Hdfc Bank Limited

Held

The Court decided not to enter into the merits of the rival claims or examine the legality of the action impugned. Instead, to serve the ends of justice by securing the disputed amount pending investigation, the Court directed respondent no. 1-Bank to keep the withheld amount of Rs. 19,05,500/- in a Fixed Deposit Receipt (FDR) with a nationalized bank, if not already invested. The FDR is to be created for an appropriate tenure to earn the highest applicable rate of interest and renewed as required, until further orders from a competent Judicial Magistrate or other competent Court/authority. The amount in FDR will remain subject to the outcome of the investigation and any subsequent proceedings, and will not be released or dealt with except as ordered by a competent court. The Court explicitly stated that it had not expressed any opinion on the merits of the matter. The petition was disposed of with these directions.

Facts

The petitioner, M/s Gahna Jewelers, a business firm dealing in jewellery, filed a writ petition seeking the release of Rs. 19,05,500/-. This amount was withheld from their bank account (account no. 50200069226431) maintained with HDFC Bank Limited (respondent no. 1) on the instructions of respondent no. 2. The petitioner stated that they had sold goods against valid tax invoices, received sale consideration through RTGS, and duly discharged their GST liability. They further submitted that they had not been arrayed as an accused, nor had they received any intimation of involvement in a criminal case. The petitioner relied on a previous order of the High Court in a similar case (W.P. No. 375/2025) where a direction was issued to keep the disputed amount in fixed deposit and permit the petitioner to operate the account.

Key Issues

1. Whether the Court should direct the release of Rs. 19,05,500/- withheld from the petitioner's bank account on the instructions of respondent no. 2, given the petitioner's assertion of having discharged GST liability and no intimation of criminal involvement? Petitioner's arguments: The petitioner argued that the amount was withheld without proper cause, as they had fulfilled their GST obligations and were not involved in any criminal proceedings. They sought relief by referring to a prior High Court order in a similar case, proposing that the disputed amount be placed in a Fixed Deposit Receipt (FDR) to protect all parties' interests during the pendency of any investigation. Revenue/State's arguments: The judgment records that the learned counsel appearing for the respondents had no objection if an appropriate order was passed protecting the disputed amount, without prejudice to the rights and contentions of either party.