Bank must unfreeze account and secure disputed cyber-fraud funds in fixed deposits pending judicial orders.

The petitioner, Sandeep Choudhary, held a bank account (A/c No. 25030339485) with the Bank of Maharashtra which was placed under an illegal hold/freeze

The petitioner approached the High Court under Article 226 of the Constitution of India seeking a direction to the bank to remove the freeze

The petitioner contended that his case was identical to a previous decision of the same court regarding bank accounts frozen due to alleged cyber-fraud without prior notice or compliance with procedural safeguards

1. Whether the respondent bank should be directed to unfreeze the petitioner's bank account in light of similar precedents involving cyber-cell holds

2. Whether the disputed amount should be secured in a fixed deposit pending investigation by law enforcement agencies

The court primarily relied on the precedent set in Malcolm Murayis & Ors. Vs. State Bank of India and Others (W.P. No. 1100 of 2024), which addressed the freezing of accounts on mere intimation from cyber cells

The court emphasized the necessity of investigating agencies to comply with Section 102 of the Code of Criminal Procedure (Cr.P.C.)—now corresponding to relevant provisions of the Bharatiya Nagarik Suraksha Sanhita (BNSS)—which requires informing the concerned Magistrate about seizures.

The court found that the petitioner’s situation was squarely covered by the Malcolm Murayis decision, applying its findings mutatis mutandis to the present case

In the cited precedent, the court noted that investigative agencies often failed to respond to judicial inquiries or comply with statutory mandates under Section 102 Cr.P.C. after requesting banks to freeze accounts

To balance the interests of the account holder with the needs of the investigation, the court reasoned that the specific "disputed amount" allegedly linked to fraud should be isolated in a fixed deposit, while the remainder of the account should be accessible to the petitioner

The bank was ordered to keep only the disputed amount (as identified by crime agencies) in a fixed deposit. This deposit is to be liquidated only upon orders from a competent Judicial Magistrate within three months, failing which the petitioner may withdraw the amount under intimation to the police agency

The petition was disposed of with these directions