Banks must unfreeze accounts while retaining disputed cyber-fraud amounts in fixed deposits.

The petitioner invoked Article 226 of the Constitution seeking removal of a freeze/hold on its Axis Bank account.

The petitioner submitted that its case was covered by Malcolm Murayis & Ors. v. State Bank of India and Others and relied also on the guidelines in Archana v. State of Madhya Pradesh and Others concerning bank-account freezes arising from cybercrime complaints.

The disputed amount identified in the petition was Rs. 10,000.

1. Whether the petitioner’s account freeze should be addressed in accordance with the principles in Malcolm Murayis and the SOP-based guidelines in Archana.

2. Whether the disputed sum of Rs. 10,000 should remain secured while the petitioner is permitted to operate the account.

Under Article 226, the Court may grant appropriate relief concerning a bank-account freeze. The SOP dated 10 April 2026 and the guidelines discussed in Archana require account restraints to be proportionate, with a lien or freeze ordinarily limited to the suspected amount where that is sufficient to protect the investigation; the investigating agency is also expected to proceed in accordance with law and inform the competent Magistrate.

Applying Malcolm Murayis, the disputed amount may be secured in a fixed deposit pending orders of the competent Judicial Magistrate, and may be released to the account holder if the requisite orders are not passed within the prescribed three-month period.

The Court considered the cited precedents applicable mutatis mutandis to the petitioner’s case.

Consistent with those authorities, it separated the comparatively limited disputed amount from the account as a whole: Rs. 10,000 was to be kept in a fixed deposit, while the account itself was to be unfrozen.

The investigating agency was expected to proceed under the relevant provisions of the BNSS or other applicable law and obtain orders from the competent Judicial Magistrate within three months.

The disputed Rs. 10,000 must be kept in a fixed deposit and may be liquidated only after orders of the competent Judicial Magistrate; if such orders are not passed within three months, the petitioner may withdraw the amount under intimation to the police agency.

The Bank may act in accordance with law if it receives a complaint concerning any other transaction, keeping the SOP in view.