Bank accounts must be unfrozen while disputed cyber-fraud amounts remain secured in fixed deposits.

The petitioner invoked Article 226 of the Constitution seeking removal of the hold/freeze on her Bank of Maharashtra account bearing Account No. 60587870489.

Her counsel relied on Malcolm Murayis & Ors. v. State Bank of India & Others , W.P. No. 1100 of 2024, decided on 26 April 2024, concerning bank-account freezes imposed pursuant to communications from cyber-crime police authorities.

The Court found the earlier decision applicable mutatis mutandis to the petitioner’s case.

The cyber-crime agencies had identified ₹2,000 as the disputed amount connected with the account.

Whether the petitioner’s bank account, which had been placed on hold/frozen pursuant to information from crime/cyber-crime agencies, should be unfrozen subject to safeguarding the disputed amount.

Whether the disputed amount of ₹2,000 should be retained in a fixed deposit pending orders of the competent Judicial Magistrate under the applicable law.

Whether the disputed amount could be released to the petitioner if the police agency failed to obtain appropriate judicial orders within the prescribed period.

The Court exercised its writ jurisdiction under Article 226 of the Constitution to regulate the continuation of a bank-account freeze arising from a police/cyber-crime investigation.

It relied on the principle laid down in Malcolm Murayis & Ors. v. State Bank of India & Others , under which the bank may preserve the specifically disputed amount in a fixed deposit, while the account itself may be unfrozen, and the fixed deposit may be liquidated only pursuant to an order of the competent Judicial Magistrate within the prescribed period.

The earlier decision referred to compliance with Section 102 of the Code of Criminal Procedure; in the present case, the Court directed the police agency to proceed under the relevant provisions of the Bharatiya Nagarik Suraksha Sanhita, 2023, or any other applicable law.

The Court considered the petitioner’s case to be materially covered by Malcolm Murayis and therefore applied that decision mutatis mutandis .

Balancing the investigative interest in preserving allegedly tainted funds against the petitioner’s right to operate her account, the Court limited the restraint to the identified disputed amount of ₹2,000 rather than continuing a blanket freeze.

The amount was directed to be placed in a fixed deposit pending judicial scrutiny, while the remaining account was ordered to be unfrozen.

The police agency was given three months to obtain appropriate orders from the competent Judicial Magistrate under the applicable statutory procedure; failing that, the disputed amount could also be released to the petitioner after intimation to the police agency.

The fixed deposit could be liquidated only upon an order of the competent Judicial Magistrate within three months.

If the police agency failed to obtain such an order within that period, the amount could be released to the petitioner upon intimation to the agency.

No broader relief was granted, and the petition stood disposed of accordingly.