Police Can Ask Bank To Freeze Account If Suspicious Transaction Found During Investigation; Affected Party Can Approach Magistrate: Allahabad High Court

The Petition before the High Court was filed under Article 226 of the Constitution against the action of freezing the bank account of the petitioner by the respondent bank, with the prayer to direct the respondent bank to defreeze her Savings Account maintained with Bank of Baroda and to permit her to withdraw the amount from her account.

The Division Bench of Justice Swarupama Chaturvedi and Justice Ajit Kumar explained, “Thus, in the event police comes to conclude that during investigation a bank account is to be freezed for suspicious transaction, it can always direct the bank to freeze such bank account. And of course, such freezing of the account shall depend upon the outcome of investigation. The affected party can of course, seek remedy from the Magistrate concerned after the investigation is concluded and if chargesheet is filed, to limit freezing of account to the extent of money involved.”

Advocate Anoop Kumar Sharma represented the Petitioner, while Additional Solicitor General of India represented the Respondent.

Factual Background

As per the Petitioner, she was employed as a Teacher at Prathmik Vidyalaya, Sakhadha, Block Mooratganj, District Kaushambi. The salary of the petitioner was credited into her savings account maintained with Bank of Baroda. It was alleged that on September 1, 2022, an amount of Rs 35,000 was credited to the said account from an Account maintained with the Federal Bank, Puthiyara Branch (Gujarat). Subsequently, the petitioner’s aforesaid account stood frozen by the respondent Bank.

Reasoning

On a perusal of the facts of the case, the Bench noted that the petitioner’s bank account had been freezed pursuant to directions issued by the investigating authorities in connection with a transaction alleged to have originated from an account unknown to the petitioner, and the transaction was suspicious in the eyes of the concerned investigating agency. The Bench referred to the judgment in Teesta Atul Setalvad vs. The State of Gujarat (2018), upholding the justness of the action of the investigating officer in the context of the bank account freezing.

Referring to Section 102 CrPC, now reincorporated as Section 106 BNSS, the Bench stated, “From a bare reading of the aforesaid provision it is clear that a police officer is entitled to seize property of accused persons during investigation by passing orders and the only duty is to report such seizure to Magistrate concerned. There is no obligation cast upon police to seek prior order from Magistrate for seizure of property.”

In the totality of the facts and circumstances of the case and in the light of the legal position, the Bench noted that the respondent bank acted in accordance with law in freezing the petitioner’s account pursuant to the directions issued and the request made by the Cyber Crime Department. As per the Bench, if the petitioner was aggrieved by freezing and wanted to get her account defreezed, it was open to her to approach the investigating authorities or a court of competent jurisdiction for appropriate relief in accordance with law as observed above.

The Bench thus found no ground to exercise the extraordinary jurisdiction under Article 226 of the Constitution of India to grant relief as prayed for. “Accordingly, the writ petition is consigned to records with liberty to the petitioner to avail such remedies as may be available to her in law”, it stated.

Cause Title: Marufa Begum v. Union Of India (Neutral Citation: 2025:AHC:190289-DB)

Appearance

Petitioner: Advocates Anoop Kumar Sharma, Vikas Rastogi

Respondent: Additional Solicitor General of India, Anadi Krishna Narayana, Central Standing Counsel

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