Arvind Lunawat vs. Axis Bank Limited

Held

The Court held that the decisions in 'Malcolm Murayis' and 'Archana' were applicable mutatis mutandis to the present case. The Court directed that the disputed amount of Rs. 4,290/- be kept in a Fixed Deposit (FD). If any other complaint regarding a different entry was received by the bank, it could take appropriate action in accordance with law, keeping in mind the SOP issued by the Government. The disputed amount in FD would 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. Failing this, the amount in FD could be withdrawn by the petitioner under intimation to the police agency. Crucially, the Court directed that the bank account of the petitioner shall be unfrozen, and the petitioner shall be permitted to operate the account. No issue was expressly left undecided.

Facts

The petitioner, Arvind Lunawat, filed a writ petition seeking to unfreeze his bank account held with Axis Bank Limited, Indore Branch. The account was frozen based on an intimation from cyber cell police stations, alleging involvement in cyber fraud. The petitioner contended that he was unaware of any such involvement and was lawfully conducting his business. He relied on previous judgments of the High Court in similar cases, specifically 'Malcolm Murayis & Ors. Vs. State Bank of India and Others' and 'Archana Vs. The State of Madhya Pradesh and Others', which dealt with the freezing of bank accounts due to cyber fraud allegations and the Standard Operating Procedure (SOP) for grievance redressal. The disputed amount in this case was stated to be Rs. 4,290/-.

Key Issues

1. Whether the bank account of the petitioner, which has been frozen based on allegations of cyber fraud without prior notice to the petitioner, should be unfrozen or subjected to specific directions for managing the disputed amount? (Section 102 of Cr.P.C., Article 226 of the Constitution of India). Petitioner's Arguments: The petitioner argued that his bank account was frozen without any notice to him, and he was engaged in lawful business. He contended that his case was squarely covered by the High Court's decisions in 'Malcolm Murayis' and 'Archana', which provided a framework for dealing with such situations, including the application of the SOP. He sought the unfreezing of his account. Revenue/State's Arguments: The judgment does not record specific arguments from the revenue or state. However, the context implies that the freezing of the account was based on instructions from cyber cell police stations alleging cyber fraud.