Rajesh Patidar vs. Bank Of INDIA

Held

The Court held that the decisions in Malcolm Murayis and Archana Vs. The State of Madhya Pradesh and Others, which dealt with similar issues of bank accounts being frozen, were applicable mutatis mutandis to the present case. The Court directed that the disputed amount of Rs. 20,200/- mentioned in the petition shall be kept in a Fixed Deposit (FD). If any other complaint is received by the bank regarding another entry, the bank can take appropriate action in accordance with law, keeping in mind the SOP issued by the Government. The disputed amount shall be allowed to be liquidated only after orders are passed by the competent Judicial Magistrate within three months. If the police agency fails to proceed in accordance with law within this period, the amount kept in FD may be withdrawn by the petitioner under intimation to the police agency. The Court further directed that the bank account of the petitioner shall be unfrozen, and the petitioner shall be permitted to operate the account. The Court did not expressly leave any issue undecided.

Facts

The petitioner, Rajesh Patidar, filed a writ petition seeking to quash the freezing of his savings bank account by the Bank of India. He also sought the immediate restoration of his account's operational rights and a declaration that the freezing was illegal and arbitrary. The petitioner contended that his case was covered by previous judgments of the High Court, specifically Malcolm Murayis & Ors. Vs. State Bank of India and Others, which dealt with similar issues of bank accounts being frozen based on intimation from cyber cells without prior notice to the account holders. The petitioner argued that he was lawfully carrying out his business and that the freezing was done without following due process. The Bank of India stated that it froze the account solely on instructions from cyber cell police stations.

Key Issues

1. Whether the freezing of the petitioner's savings bank account by Respondent No.1 (Bank of India) is illegal, arbitrary, and violative of Articles 14, 19(1), and 21 of the Constitution of India, considering the lack of prior notice or opportunity to be heard. 2. Whether the procedure followed by the cyber cell police stations in directing the freezing of the bank account, without adhering to Section 102 of the Cr.P.C. or providing proper intimation to the concerned Magistrate, is in accordance with law. Petitioner's Arguments: The petitioner argued that the freezing of his account was done without any notice or opportunity to present his case, making it arbitrary and violative of his constitutional rights. He relied on the High Court's decision in Malcolm Murayis, which held that accounts should not be frozen mechanically and that proper procedure under Section 102 of Cr.P.C. should be followed. He also pointed to the Standard Operating Procedure (SOP) for Grievance Redressal Mechanism in respect of bank accounts put on hold through NCRP-CFCFRMS, which mandates a structured procedure and timelines. Revenue/State's Arguments: The judgment does not record specific arguments from the revenue or state beyond the bank's submission that it acted on instructions from cyber cell police stations.