MP HC Unfreezes Man’s Bank Account, Keeps Disputed ₹550 In FD But Allows Withdrawal If Magistrate Does Not Act Within 3 Months

In brief

The question

1. Whether the petitioner’s bank account should remain fully frozen where the disputed amount identified in the petition was Rs. 550.

The court held

The Court allowed the petitioner to operate the bank account after its unfreezing and directed the Bank to keep Rs. 550 in a fixed deposit.

It also directed

The disputed amount may be liquidated only after an order of the competent Judicial Magistrate; if no such order is passed within three months, the petitioner may withdraw the amount under intimation to the police agency.

The Bank may address any further complaint concerning another transaction in accordance with the SOP and applicable law.

The petition was disposed of.

01Facts

The petitioner sought a writ directing Indian Bank to unfreeze and restore full operation of his account, subject to retaining the disputed amount of Rs. 550.

¶ 1

He submitted that his case was covered by Malcolm Murayis & Ors. v. State Bank of India & Others and relied also on the grievance-redressal procedure and proportionality guidelines discussed in Archana v. State of Madhya Pradesh & Others.

¶ 2, 4

The Court considered those precedents applicable to the petitioner’s case.

¶ 5

02Issues

i.1. Whether the petitioner’s bank account should remain fully frozen where the disputed amount identified in the petition was Rs. 550.

¶ 1, 5–6

ii.2. Whether the disputed amount should instead be secured separately, with the balance of the account released for operation, subject to action by the competent authority.

¶ 6

03Law Applied

Under Article 226 of the Constitution, the High Court may grant appropriate relief where a bank-account freeze is disproportionate to the amount suspected to be linked to cybercrime.

¶ 3

The Court relied on Malcolm Murayis, which directed that the disputed amount be kept in a fixed deposit and contemplated its release if the competent Magistrate did not pass an order within three months.

¶ 3, quoting Malcolm Murayis · ¶ 9

It also applied Archana, which discussed the Ministry of Home Affairs SOP dated 10 April 2026 and the principle that account restraints should be proportionate: ordinarily, a lien or debit freeze should be limited to the suspected amount, while a freeze of the entire account requires exceptional circumstances and recorded reasons.

¶ 4, quoting Archana · ¶ 11–18

The Court directed that the police agency proceed under the relevant provisions of the BNSS or other applicable law.

¶ 6

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

Code of Criminal Procedure, 1973 Section 102

04Reasoning

Applying Malcolm Murayis and Archana mutatis mutandis, the Court treated retention of the entire account as unnecessary where the identified disputed amount was only Rs. 550.

¶ 5–6

It therefore balanced preservation of the disputed sum against the petitioner’s ability to operate the account by directing that the sum be kept in a fixed deposit and that the account be unfrozen.

¶ 6

The police agency was allowed three months to seek an order from the competent Judicial Magistrate; failing that, the fixed-deposit amount could be withdrawn by the petitioner after informing the police agency.

¶ 6