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2025 Supreme(Online)(Ker) 46709
IN THE HIGH COURT OF KERALA AT ERNAKULAM
M.A. ABDUL HAKHIM, J
MUBASHEER P – Appellant
Versus
ESAF SMALL FINANCE BANK – Respondent
WP(C) NO. 34993 OF 2025
For the Appellants/Petitioners: SHRI.AMAL PARTHASARADHY, SRI.GIBI.C.GEORGE
For the Respondents: SRI.B.S.SURESH KUMAR, SRI.ASHLEY JOHN, SMT.RANJANA V., SMT.ANUSREE C.S., SHRI.JAISON MATHEW, SHRI.SAVIO BINOY CORREYA
Account freezing must comply with statutory requirements ensuring property rights are not violated absent connection to alleged crimes.
Headnote:This judgment pertains to a Writ Petition challenging the debit freezing of a bank account due to police requisition. The Petitioner asserts a lack of connection to the accused in the crime. The Court found that the requisition violates relevant legislation concerning property rights. Major issues include the legality of account freezing and effective communication from police. The Court instructed that account freezes be limited to specified amounts and ordered prompt communication between authorities and banks regarding account restrictions. The final ruling confirmed the Petitioner’s right to challenge uncommunicated future seizures and provided directives for account management by the Bank and police. The judgment’s outcome emphasizes the need for lawful processes in freezing accounts linked to criminal investigations.
| Table of Content |
|---|
| 1. court's stance on account freezing based on prior judgments. (Para 5 , 6 , 7 , 8) |
| 2. requisitions' impact on bank liability. (Para 9) |
| 3. final orders regarding accountability and communication. (Para 10) |
JUDGMENT
1. The Petitioner has filed this Writ Petition challenging the debit freezing/lien of his Bank account with the Respondent/Bank at the requisition of the Police authorities. The case of the Petitioner is that the Petitioner is not an accused in the Crime registered by the Police authorities against some other persons, in which the requisition was made; that the Petitioner is in no way connected with the said Crime; and that the debit freezing/lien of the account is in violation of Sections 106 & 107 of the Bharatiya Nagarik Suraksha Sanhita, 2023 ( BNSS ) and
2. Initially, the Petitioner had impleaded only the respondent No.2 alone in the party array, which is a Cyber Crime Cell in Patna. Later, on instructions, the learned standing counsel submitted that the requisitions were received from two other Police Stations, and those Police Stations were impleaded as Respondent Nos.3 & 4.
3. The learned Counsel for the Respondent/Bank, after getting instructions from the Bank, confirms that there are no requisitions from the Respondent No.2 and the requisitions are received from the Respondent Nos.3 & 4. The Bank has received one requisition from the respondent No.3 for an amount of Rs.3,000/- and another requisition from the respondent No.4 for an amount of Rs.150/-, for marking lien of the account of the Petitioner mentioned in the Writ Petition, and hence, the Bank has effected lien of the account of the Petitioner.
4. This Court considered the same issue in Dr. Sajeer v.
Reserve Bank of India [ 2024 (1) KLT 826 ], and this Court issued the following directions.
"a. The respondent Banks arrayed in these cases, are directed to confine the order of freeze against the accounts of the respective Petitioners, only to the extent of the amounts mentioned in the order / requisition issued to them by the Police Authorities. This shall be done forthwith, so as to enable the Petitioners to deal with their accounts, and transact therein, beyond that limit.
b. The respondent - Police Authorities concerned are hereby directed to inform the respective Banks as to whether freezing of accounts of the Petitioners in these Writ Petitions will require to be continued even in the afore manner; and if so, for what further time, within a period of eight months from the date of receipt of a copy of this judgment.
c. On the Banks receiving the afore information / intimation from the Police Authorities, they will adhere with it and complete necessary action - either continuing the freeze for such period as mentioned therein; or withdrawing it, as the case may be.
d. If, however, no information or intimation is received by their Banks in terms of direction (b) above, the Petitioners or such among them, will be at full liberty to approach this Court again; for which purpose, all their contentions in these Writ Petitions are left open and reserved to them, to impel in future."
5. Subsequently, this Court considered the same issue in Nazeer K.T. v. Manager, Federal Bank, Makkaraparamba Branch [2024 KHC 768].
6. InNazeer K.T., this Court considered the scope of Section 102 of the Code of Criminal Procedure, 1973 (corresponding to Section 106 of the BNSS ), with reference to the law laid down by the Hon'ble Supreme Court inState of Maharashtra v. Tapas D. Neogy [(1999) 7 SCC 685], Teesta Atul Setalvad v. State of Gujarat [(2018) 2 SCC 372] and Shento Varghese v. Julfikar Husen and Others [ (2024) 7 SCC 23 ], concurred with the view inDr. Sajeer (supra) and added the following two more directions.
“(i) The Police officer concerned shall inform the Banks whether the seizure of the Bank account has been reported to the jurisdictional Magistrate and if not, the time limit within which the seizure will
