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2025 Supreme(Online)(Ker) 36580
IN THE HIGH COURT OF KERALA AT ERNAKULAM
V. G. Arun, J
PRAKHAR GUPTA – Appellant
Versus
STATE OF KERALA – Respondent
CRL.MC NO. 4327 OF 2025
For the Appellants/Petitioners: SHRI.RENOY VINCENT, SHRI.CHELSON CHEMBARATHY, SHRI.ABEE SHEJIRIK FASLA N.K, SHRI.M.N.MOHAMMED HUSSAIN
For the Respondents: SMT. SHEEBA THOMAS
Lien marking on bank accounts requires prior court order under Section 107 of BNSS; failure to comply renders the lien invalid.
Headnote:(A) Offences concerning banking and finance - Section 107 of BNSS - Release of lien on funds - The petitioner claimed the release of Rs.1,23,000/- marked as lien by the Investigating Officer in an ongoing investigation. The court found procedural flaws in the lien marking as no order from the jurisdictional Magistrate was obtained prior to marking the amount as lien. (Paras 1, 5)
(B) Procedural fairness - The absence of a clear process for lien marking compromises the legitimacy of the action against the funds in the petitioner’s account, necessitating reevaluation by the Magistrate. (Paras 2, 5)
Facts of the case:
The case originated from a complaint alleging fraudulent investment, leading to the interim attachment of the petitioner’s funds which the court deemed improperly executed without requisite orders.
Findings of Court:
The court decided to quash the prior order denying the petitioner’s request, emphasizing procedural adherence for lien marking.
Issues: The primary issue was whether the lien on the petitioner’s account was valid in light of the procedural requirements set forth by law.
Ratio Decidendi: The court ruled that lien marking should occur only after obtaining prior orders from the jurisdictional Magistrate, highlighting the need for compliance with established legal protocols.
Result: The court quashed the order denying the release of the funds and instructed reevaluation of the lien by the Magistrate.
| Table of Content |
|---|
| 1. identification of procedural deficiencies in lien marking. (Para 1) |
| 2. petitioner's claim for release of funds based on alleged improper lien. (Para 2) |
| 3. emphasis on necessity of following legal procedures for lien attachments. (Para 5) |
O R D E R
Dated this the 3rd day of July, 2025 The petitioner is aggrieved by Annexure H order, to the extent it declines the prayer for release of Rs.1,23,000/- from his account, lien marked by his own bank, pursuant to a direction in that regard issued by the Investigating Officer in Crime No.752 of 2023 registered at the Binanipuram Police Station. The essential facts are as under;
The 2nd respondent filed a complaint before the police alleging that he had transferred a sum of Rs.15 lakhs to the bank accounts of the accused named in the FIR between 09.12.2023 and 11.12.2023 by believing their promise of high dividends on investments. The accused did not pay the dividends as promised and failed to refund the amount transferred. Upon investigation, the amounts remitted in the accounts of the accused were found to have been transferred to various persons. From the amounts thus transferred, Rs.3,64,800/- was credited in the petitioner’s account. Hence, a direction was issued to lien mark Rs.1,23,000/- out of that amount. The 2nd respondent later submitted an application before the jurisdictional court seeking release of an amount of Rs.1,59,632. On being issued with notice in that application, the petitioner, on his part, filed Annexure E application seeking lifting of the lien over Rs.1,23,000/- in his account. The court below having rejected the prayer and directed retention of the amount in the petitioner’s account, this Crl.M.C is filed.
2. Learned Counsel for the petitioner submits that his client is not an accused in the crime registered at the instance of the 2nd respondent and is at the third level of the transaction. It is pointed out that even though the specific case of the de facto complainant is that he was cheated of only Rs.15 lakhs, the total of all amounts attached or lien marked by the police based on the complaint would come to around Rs.43 lakhs. It is hence contended that no loss is caused to the de facto complainant by the amount in the petitioner’s account being released to him.
3. Learned Public Prosecutor submitted that the crime is still under investigation and hence, it will not be advisable to lift the lien over the petitioner’s account.
4. The de facto complainant has not appeared, despite service of notice.
5. While considering the relief sought by the petitioner, it is pertinent to note that after the introduction of Section 107 in the BNSS, proceeds of crime can be attached only by following the procedure prescribed therein. As such, the attachment/lien marking of the amount in the petitioner’s account should be preceded by an order from the jurisdictional Magistrate. The materials on record does not reveal the obtainment of such an order prior to lien marking the amount in the petitioner’s account. As such, the procedure adopted for lien marking itself is fundamentally flawed.
The Crl.M.C is hence disposed of by quashing Annexure H order, to the extent it rejects the petitioner’s claim for lifting the lien and releasing the amount of Rs.1,23,000/- in his account. The learned Magistrate shall reconsider Annexure E petition and lift the debit freeze imposed/ lien marked over the petitioner’s bank account. The Investigating Officer can approach the jurisdictional Magistrate under Section 107 of BNSS, if attachment is warranted.
