Only the cybercrime-linked disputed amount may remain frozen; the remaining account balance must be defreezed.

The petitioner filed a petition under Article 226 of the Constitution seeking directions to the concerned authorities and One Mobikwik Systems Limited to defreeze or remove the hold on his bank account, along with consequential reliefs and costs.

The account had been frozen pursuant to information or directions received from cyber-crime agencies concerning an amount allegedly connected with a cyber offence.

The High Court noted that the petitioner’s case was squarely covered by its earlier decision in Malcolm Murayis & Others v. State Bank of India & Others, W.P. No. 1100 of 2024, decided on 26 April 2024.

In that precedent, the Court had directed that the disputed amount be placed in fixed deposits pending appropriate orders from the competent Magistrate, while permitting the remaining balance to be operated by the account holder.

1. Whether the petitioner’s bank account, frozen pursuant to information supplied by cyber-crime or police agencies, should continue to remain completely frozen when the disputed amount can be separately secured?

2. Whether the disputed amount should be retained in fixed deposit pending orders of the competent Judicial Magistrate under the applicable law, while the remainder of the account is defreezed?

The Court applied Article 226 of the Constitution, under which the High Court may issue appropriate writs and directions to protect legal rights and ensure that public authorities act in accordance with law.

It relied principally on Malcolm Murayis & Others v. State Bank of India & Others, W.P. No. 1100 of 2024, decided on 26 April 2024, which held that where a bank account is frozen on the request of cyber-crime authorities, the disputed amount may be secured in a fixed deposit and may be liquidated only pursuant to an order of the competent Judicial Magistrate; if the investigating agency fails to obtain such an order within the prescribed period, the amount may be released to the account holder under intimation to the agency.

The earlier decision referred to compliance with Section 102 of the CrPC, or any other applicable law; in the present case, the Court directed the police agency to proceed under the relevant provisions of the BNSS or other applicable law.

The Court found the petitioner’s case to be mutatis mutandis covered by the principle laid down in Malcolm Murayis.

A complete freeze of the account was considered unnecessary where the amount allegedly linked to the cyber offence could be identified and separately protected.

Accordingly, the Court balanced the interests of the investigation and the petitioner by directing the bank to place only the disputed amount, as communicated by the crime agencies, in fixed deposits.

Such fixed deposits could be liquidated only after an order of the competent Judicial Magistrate within three months, thereby requiring the investigating agency to take timely action under the applicable law.

The Court further held that any undisputed balance was not required to remain frozen and should be released for operation by the petitioner.

The concerned bank was directed to keep the disputed amount identified by the crime agencies in fixed deposits, with liquidation permitted only pursuant to an order of the competent Judicial Magistrate within three months.

If no such order was obtained within that period, the fixed-deposit amount could also be withdrawn by the petitioner under intimation to the police agency.

The petitioner’s bank account or accounts mentioned in the relief clause were directed to be unfrozen, and the remaining undisputed amount, if any, was ordered to be released from the freeze.