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HIGH COURT OF KERALA
C. JAYACHANDRAN, J
SREEKALA K. – Appellant
Versus
CENTRAL BUREAU OF INVESTIGATION – Respondent
WP(Crl.) 1284/2022
Certainly. Based on the provided legal document, here are the key legal points:
The court affirmed that freezing bank accounts under Section 102 of the Criminal Procedure Code (Cr.P.C.) is valid, even if there is no immediate reporting of the seizure to the Magistrate. The purpose of Section 102(3) is to facilitate disposal of the seized property, but non-compliance does not automatically invalidate the seizure itself (!) (!) .
The distinction between seizure under Section 102 Cr.P.C. and attachment under the Criminal Law Amendment Ordinance, 1944, is crucial. The former is an investigative step, while the latter pertains to securing property believed to be procured through a scheduled offence, with specific safeguards like judicial orders and opportunities for the accused to be heard (!) (!) .
The validity of a seizure or freeze of bank accounts under Section 102 Cr.P.C. is supported by the interpretation that the property, including bank accounts, can be seized during investigation, and such seizure is not rendered illegal by the absence of immediate reporting to the Magistrate (!) (!) .
The failure to report the seizure to the Magistrate as mandated by Section 102(3) Cr.P.C. does not automatically invalidate the seizure or make it illegal. The legal position is that reporting is procedural and aimed at disposal of the property, but it is not a jurisdictional requirement for the validity of the seizure (!) (!) (!) .
The recent judicial stance clarifies that the power to seize property under Section 102(1) Cr.P.C. is independent of the duty to report under Section 102(3). The purpose of the reporting obligation is only to facilitate disposal, and non-compliance does not affect the legality of the seizure itself, although it may impact the rights of the property owner during trial (!) (!) (!) .
The court emphasized that the scope and purpose of the Criminal Law Amendment Ordinance, 1944, and the powers under Section 102 Cr.P.C. are different. The Ordinance's attachment provisions are separate and do not substitute or invalidate the powers under Section 102 Cr.P.C. in the context of investigations (!) (!) .
The court rejected the argument that recourse to Section 102 Cr.P.C. for freezing accounts is illegal in cases under the Prevention of Corruption Act, emphasizing that the powers under Section 102 Cr.P.C. remain applicable and valid during investigations (!) (!) .
The court directed the investigating officer to produce any document reporting the seizure to the special court or to report such seizure within one month from the judgment's receipt, ensuring procedural compliance without invalidating the seizure (!) .
The challenge to the seizure/freezing of the bank accounts was ultimately rejected, with the court noting that the seizure remains valid despite the procedural lapses, provided the report is made subsequently as directed (!) .
The court clarified that non-compliance with reporting obligations does not automatically render the seizure illegal, but the property owner retains the right to seek custody or disposal of the property through appropriate legal channels (!) .
These points reflect the court's nuanced understanding that while procedural safeguards are important, the core investigative powers under Section 102 Cr.P.C. are valid and can be exercised independently of reporting obligations, provided the seizure is made during a legitimate investigation.
| Table of Content |
|---|
| 1. arguments by learned amicus (Para 2) |
| 2. discussion on legal provisions (Para 3 , 4 , 5 , 6 , 7 , 8) |
| 3. seizure validity independent of reporting (Para 9 , 10 , 11 , 12 , 13 , 14 , 15 , 16 , 17) |
| 4. challenge against seizure repelled (Para 18 , 19 , 20 , 21 , 22 , 23 , 24 , 25 , 26 , 27 , 28) |
JUDGMENT
The petitioner herein is the 3rd accused in Crime No.VC.02/18/CRE of the Vigilance and Anti Corruption Bureau, Central Range, Ernakulam. She is aggrieved by the freezing of Exts P5 and P6 bank accounts in her name, pursuant to Exts P1 and P2 requests made by the Deputy Superintendent of Police, attached to the 4th respondent VACB. The specific ground raised is the non-adherence to the provisions of the Criminal Law Amendment Act, 1944 to freeze/attach the bank accounts of the petitioner. It is also urged that recourse to any of the provisions of the Code of Criminal Procedure is also not made. Another contention urged is that the accounts has been freezed without any enabling orders from a judicial authority. The seriousness of the issues involved impelled this Court to appoint an amicus curiae. Accordingly,Sri.John S. Ralph was appointed as the amicus.
2. Heard the learned amicus; learned counsel for the petitioner; learned Special Public Prosecutor(CBI); the learned counsel for the 2nd respondent Bar Council; and learned counsel for the 3rd respondent, Dhanlaxmi Bank.
3. Before addressing the specific issues which have surfaced for consideration, it is noticed that the offences alleged in the subject crime bearing F.I.R No. RC0342022A0001 of the Special Court – I(CBI), Ernakulam are under Sections 109, 120B, 409, 420 and 477A of the Indian Penal Code, read with Sections 13 (2) and 13(1)(c) and (d) of the Prevention of Corruption Act. There are 9 accused altogether, of whom the petitioner is the wife of the 1st accused. The gist of the prosecution allegation is that, the 1st accused (petitioner's husband), while working as the Accountant of the Kerala Bar Council, had misappropriated money to the tune of ₹ 7.6 Crores from the Kerala Bar Council Welfare fund during the period from 2007 to 2017. According to the prosecution, the petitioner had conspired with and abetted the commission of the crime, by siphoning off the amount misappropriated through two of her bank accounts, maintained with the 3rd respondent Dhanlaxmi Bank, to the extent of ₹96 lakhs, approximately.
4. Arguments advanced by the learned amicus The first point mooted by the learned amicus is that, when there exists a specific provision under the Criminal Law Amendment Ordinance, 1944 for attachment of properties involved in a crime, recourse to freeze the account, purportedly under Section 102 of the Code of Criminal Procedure, is illegal. Learned amicus would elaborate that, by virtue of Section 18 A of the Prevention of Corruption Act, the Criminal Law Amendment Ordinance, 1944 has been made applicable to an offence committed under the said Act; and by virtue of Section 5 (6) of the Act, the special Judge is empowered to exercise the powers and functions of a District Judge under the Criminal Law Amendment Ordinance, 1944. According to the learned amicus, the Prevention of Corruption Act is a complete Code; and so is the Ordinance of the year 1944, as regards the procedure for attachment. That being the situation, recourse to Section 102 Cr.P.C - when there exists a special provision in the 1944 Ordinance, as made applicable to the offences under the Prevention of Corruption Act - is illegal. Learned amicus would also submit that, under the 1944 Ordinance, a person aggrieved by the attachment has more protection, since it mandates a judicial Order, coupled with an opportunity of hearing and also to adduce evidence. No such safeguard is available with respect to a seizure under Section 102 of the Cr.P.C. It was specifically pointed out that the impugned order freezing the bank accounts was passed on 13.12.2017, a date before Section 18A was inserted to t
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