MP HC Unfreezes Bank Account, Allows Disputed ₹47,000 In FD To Be Withdrawn If No Magistrate Order Within 3 Months

In brief

The question

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

The court held

The petition was disposed of with directions to keep Rs. 47,000 in a fixed deposit and to unfreeze the petitioner’s bank account for operation.

It also directed

The fixed deposit may be liquidated only after orders of the competent Judicial Magistrate, which the police were expected to obtain within three months by proceeding under the relevant law.

If they fail to do so within that period, the petitioner may withdraw the amount in the fixed deposit after informing the police agency.

The Bank may take appropriate action in accordance with law and the SOP if it receives a complaint concerning another transaction.

01Facts

The petitioner filed a petition under Article 226 of the Constitution seeking to unfreeze his bank account. He relied on the Madhya Pradesh High Court’s decisions in Malcolm Murayis & Ors. v. State Bank of India & Ors. and Archana v. State of Madhya Pradesh & Ors.

¶ 1–4

The Court recorded that the disputed amount was Rs. 47,000 and considered the appropriate treatment of that amount alongside the petitioner’s request to operate the account.

¶ 6

02Issues

i.Whether the petitioner’s bank account should be unfrozen while the disputed amount is secured separately.

¶ 5–6

ii.Whether the disputed amount should remain secured pending action by the police and orders of the competent Judicial Magistrate.

¶ 6

03Law Applied

Article 226 empowers the High Court to grant appropriate relief where a bank-account freeze requires judicial intervention.

In Malcolm Murayis, the Court directed that the disputed amount be kept in a fixed deposit and made its release contingent on proceedings before the competent Magistrate within the specified period.

¶ 3

Archana sets out principles for proportionate freezing of accounts and a grievance-redressal process under the Ministry of Home Affairs’ Standard Operating Procedure dated 10.04.2026, including that restraints should ordinarily be limited to the suspected amount where that adequately protects the investigation.

¶ 4

The Court applied these decisions mutatis mutandis and required the police to proceed under the relevant provisions of the BNSS or other applicable law.

¶ 5–6

Provisions in the judgment · 1 · Linked ones open on LawLens

Code of Criminal Procedure, 1973 Section 102

04Reasoning

The Court considered Malcolm Murayis and Archana applicable to the petitioner’s case.

¶ 5

Applying their approach, it separated the alleged disputed sum of Rs. 47,000 from the rest of the account: the sum was to be secured in a fixed deposit, while the account itself was to be unfrozen so the petitioner could operate it. This preserved the disputed amount pending lawful action without continuing the restraint on the entire account.

¶ 6

05Holding

The petition was disposed of with directions to keep Rs. 47,000 in a fixed deposit and to unfreeze the petitioner’s bank account for operation.

¶ 6

The fixed deposit may be liquidated only after orders of the competent Judicial Magistrate, which the police were expected to obtain within three months by proceeding under the relevant law.

¶ 6

If they fail to do so within that period, the petitioner may withdraw the amount in the fixed deposit after informing the police agency.

¶ 6

The Bank may take appropriate action in accordance with law and the SOP if it receives a complaint concerning another transaction.

¶ 6

LawLens.Madhya Pradesh High Court

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