Bank accounts frozen on police instructions must be unfrozen by securing disputed amounts in fixed deposits.

The petitioner, Mr. Navneet Bhawsar, maintains a current-saving bank account with IDBI Bank at the Tehsil Chouraha Branch, Sehore

On the instructions of the Cyber Police (Respondent No. 2), the bank placed a hold on an amount of ₹3,700 in the said account

The petitioner challenged this action, seeking a direction to remove the hold and quash the seizure order, alleging that the freezing of the account was conducted without complying with the statutory procedures under the Bharatiya Nagarik Suraksha Sanhita (BNSS), 2023, and violated constitutional mandates

1. Whether the action of marking an indefinite hold on the petitioner’s bank account without complying with Sections 106(3) and 107 of the BNSS, 2023, is illegal and unconstitutional

2. Whether the petitioner is entitled to have the bank account unfrozen and the disputed amount dealt with through an alternative mechanism to balance the interests of the investigation and the account holder

The Court primarily applied the ratio from the precedent Malcolm Murayis & Ors. v. State Bank of India and Others (W.P. No. 1100 of 2024), which addressed similar grievances regarding cyber-cell-directed account freezes

The Court referred to Sections 106(3) and 107 of the Bharatiya Nagarik Suraksha Sanhita (BNSS), 2023 (the successor to Section 102 of the Cr.P.C.), regarding the power of police to seize property and the requirement to report such seizures to a Magistrate

It also considered the protection of rights under Articles 14, 19(1)(g), 21, and 300A of the Constitution of India

The Court determined that the petitioner’s situation was identical to the circumstances in Malcolm Murayis, where accounts were frozen based solely on police intimations of suspected cyber fraud without further procedural follow-up

The Court noted that cyber crime cells often exhibit an "irresponsible approach" by instructing banks to freeze accounts but failing to respond to inquiries or comply with Section 102 of the Cr.P.C. (now BNSS)

To mitigate the hardship caused to the account holder while preserving the disputed funds for the investigation, the Court held that the disputed amount should be isolated in a fixed deposit rather than freezing the entire account

The Court concluded that the same directions must apply mutatis mutandis to the present case to ensure legal compliance

The bank was directed to keep the disputed amount of ₹3,700 in a fixed deposit (FD)

The FD shall only be liquidated upon the orders of a competent Judicial Magistrate within a period of three months

If the police agency fails to proceed in accordance with the law within this timeframe, the petitioner is permitted to withdraw the FD amount under intimation to the agency