Cyber-fraud account freezes must be proportionate, securing the disputed amount while restoring legitimate account operations.

The petitioner sought directions to unfreeze his Equitas Small Finance Bank current account, restore its digital banking facilities, and keep the disputed amount in a fixed deposit pending orders of the competent Judicial Magistrate.

He relied on Malcolm Murayis & Ors. v. State Bank of India & Others and the later decision in Archana v. State of Madhya Pradesh & Others, which discussed the Ministry of Home Affairs’ Standard Operating Procedure dated 10.04.2026 for grievances concerning accounts placed on hold through the NCRP-CFCFRMS.

The Court identified the disputed amount as Rs. 16,878 and applied those decisions to the petitioner’s case.

1. Whether the petitioner’s bank account should remain entirely frozen when the disputed amount is identifiable and can be secured separately.

2. Whether the disputed amount should be retained in a fixed deposit pending action by the competent Judicial Magistrate under the applicable law.

Under Article 226 of the Constitution, the High Court may grant appropriate relief concerning an account freeze.

The Court applied the principles in Malcolm Murayis and Archana: a restraint on a bank account should be proportionate to the suspected proceeds of crime, and a specific disputed amount may be secured separately rather than by freezing the entire account where that is sufficient to protect the investigation.

The Archana decision discussed the SOP dated 10.04.2026, including its grievance-redressal mechanism and the responsibilities of banks and investigating agencies.

The Court also directed that the disputed amount be dealt with under the relevant provisions of the BNSS or other applicable law, with the competent Judicial Magistrate to pass orders within three months.

The Court considered the petitioner’s case covered mutatis mutandis by Malcolm Murayis and Archana.

Since the disputed sum was identified as Rs. 16,878, the Court directed that this amount be preserved in a fixed deposit while allowing the petitioner to operate the account, rather than continuing a freeze on the entire account.

It also required the police agency to proceed in accordance with law and obtain orders from the competent Judicial Magistrate within three months; absent such orders, the fixed-deposit amount could be withdrawn by the petitioner after informing the police agency.

The disputed amount of Rs. 16,878 was directed to be kept in a fixed deposit, withdrawable only after orders of the competent Judicial Magistrate within three months; if no such orders were passed within that period, the petitioner could withdraw the amount after intimating the police agency.

The bank account was to be unfrozen, and the petitioner permitted to operate it.