Nikhil vs. Branch Manager
Held
The Court held that the principles laid down in the cases of Malcolm Murayis and Archana would apply mutatis mutandis to the present case. It directed that the disputed amount of Rs. 10,298.98/- in the petitioner's account be kept in a Fixed Deposit (FD). The bank was instructed to unfreeze the petitioner's account and permit him to operate it. The FD was to be liquidated only after orders were passed by the competent Judicial Magistrate within three months, with the expectation that the police agency would proceed according to law. If the police agency failed to act within this timeframe, the amount in FD could be withdrawn by the petitioner, with intimation to the police agency. The Court also noted that it was open for the petitioner to file a separate petition regarding an amount of Rs. 23,000/- frozen by Punjab National Bank, which was not a party to the present petition. The Court emphasized adherence to the SOP issued by the Government for handling such matters.
Facts
The petitioner, Nikhil, filed a writ petition seeking to unfreeze his bank account. The account had been frozen by the bank upon intimation from cyber cells of various police stations, alleging involvement in cyber fraud. The petitioner contended that he was engaged in lawful trading of crypto and virtual currency and had not received any notice regarding involvement in any offense. He argued that the freezing was done without complying with Section 102 of the Cr.P.C. and without informing the concerned Magistrate. The bank stated it acted solely on instructions from investigating authorities. The Court referred to previous judgments in "Malcolm Murayis & Ors. Vs. State Bank of India and Others" and "Archana Vs. The State of Madhya Pradesh and Others," which dealt with similar issues and introduced a Standard Operating Procedure (SOP) for grievance redressal in cyber crime cases involving frozen bank accounts.
Key Issues
1. Whether the freezing of the petitioner's bank account by the respondent bank, based on intimation from cyber cell police stations, was done in accordance with law, particularly Section 102 of the Code of Criminal Procedure, 1973 (Cr.P.C.)? Petitioner's arguments: The petitioner argued that the freezing was arbitrary and illegal as no notice was served, and Section 102 Cr.P.C. was not complied with, including the requirement to inform the Magistrate. He contended that his business was lawful and that the freezing prevented him from operating his account. Revenue/State's arguments: The respondent banks argued that they acted solely on the instructions of the investigating authorities (cyber cell police stations) and were bound by those directives. They did not present independent arguments regarding the legality of the freezing itself but rather their procedural compliance.
Sections Cited
Section 102
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Cause title — parties, addresses and appearances
ORDER This writ petition has been preferred by the petitioner under Article 226 of the Constitution of India praying for the following reliefs: i) to issue appropriate writ and directions, orders may kindly be given to the respondents to unfreeze the bank account of the petitioner in the interest of justice. ii) Any other writ direction or orders which this Hon’ble Court may deem fit and proper in the circumstances of the case.
Learned counsel for the petitioner has submitted that the case of the petitioner is squarely covered by the decision rendered by this Court in the case of Malcolm Murayis & Ors. Vs. State Bank of India and Others Malcolm Murayis & concerned, the same reads as under:- "1] This order shall also gove
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