Cyber-fraud holds must be limited to disputed sums, with the remaining bank balance unfrozen.

The petitioner sought relief under Article 226 of the Constitution against the freeze/hold imposed on its IndusInd Bank account, alleging that it had been frozen without lawful authority or an order

Counsel submitted that the matter was covered by Malcolm Murayis & Ors. v. State Bank of India & Others, W.P. No. 1100 of 2024, decided on 26 April 2024

1. Whether the petitioner’s account, frozen following action by crime agencies, should be unfrozen while preserving the disputed amount pending proceedings before a competent Judicial Magistrate

2. Whether the disputed amount could remain in fixed deposits indefinitely absent an order by a competent Judicial Magistrate within the prescribed period

Article 226 of the Constitution provides the basis for the High Court’s power to grant writ relief.

The Court applied Malcolm Murayis (W.P. No. 1100 of 2024, decided 26 April 2024), which directed that the amount identified by cybercrime agencies be kept in fixed deposits and permitted its release if the competent Judicial Magistrate did not pass an order within three months, following action by the police under Section 102 of the CrPC or other applicable law. In this case, the Court referred to the relevant provisions of the BNSS or other law relied upon by the police

The Court considered the petitioner’s case covered by Malcolm Murayis and applied that decision mutatis mutandis

It balanced preservation of the disputed amount with the petitioner’s access to the rest of its funds: the identified amount was to remain in fixed deposits pending a competent Judicial Magistrate’s order within three months, while the account was to be unfrozen and any remaining amount released

Any other funds in the account were not to remain frozen