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

The petitioner sought a writ directing State Bank of India to unfreeze his account, which had been frozen following action by cyber-crime authorities. He alternatively asked that any freeze be limited to the disputed amount of ₹20, and sought disclosure of the complaint underlying the freeze

Relying on Malcolm Murayis & Ors. v. State Bank of India and Others, W.P. Nos. 1100 and 1185 of 2024, decided on 26 April 2024, the petitioner argued that the same approach should apply

1. Whether the petitioner’s bank account should be unfrozen while the disputed amount of ₹20 is separately secured.

2. Whether the disputed amount should remain secured pending orders of a competent Judicial Magistrate, and what should follow if no such orders are passed within three months.

The Court exercised its jurisdiction under Article 226 of the Constitution and applied its decision in Malcolm Murayis & Ors. v. State Bank of India and Others, W.P. Nos. 1100 and 1185 of 2024 (26 April 2024).

Under that decision, the bank is to place the amount identified by the cyber-crime authorities in a fixed deposit, releasable only pursuant to an order of the competent Judicial Magistrate within three months; if no such order is passed within that period, the amount may be withdrawn by the account holder under intimation to the cyber-crime authorities.

The present order refers to action under the relevant provisions of the BNSS or any other law relied upon by the police, without identifying a specific provision.

The Court found the facts and relief sought to be governed by the approach in Malcolm Murayis and applied that decision mutatis mutandis.

It therefore separated preservation of the potentially disputed sum from restrictions on the account as a whole: only ₹20 was to be retained in a fixed deposit, while the account was to be unfrozen and any remaining balance made available to the petitioner.

The fixed deposit would remain subject to an order of the competent Judicial Magistrate within three months; absent such an order, the petitioner could withdraw it after informing the police agency.

The petition was disposed of accordingly.