Karnataka High Court Directs Police To Examine Unauthorised SIM Card Activations; Seeks Review Of Verification Safeguards

The Court was hearing a criminal petition seeking quashing of proceedings under Sections 406, 419 and 420 of the Indian Penal Code, 1860, pending before the III Additional Chief Judicial Magistrate, Bengaluru, concerning the alleged possession and proposed sale of 75 pre-activated SIM cards.

A Bench of Justice Suraj Govindaraj observed: “The facts alleged in the present case, particularly the alleged possession of 75 SIM cards belonging to two different mobile service operators and the assertion that the cards had been activated in the names of different individuals, warrant examination of whether the existing safeguards are adequate to prevent the unauthorised activation and subsequent circulation of SIM cards. The matter also calls for consideration of the measures available to identify suspicious patterns of activation and to enable persons whose identification particulars have been misused to obtain timely information and seek corrective action.”

Advocate Vijay Kumar T. appeared for the petitioner. High Court Government Pleader Ranjith Kumar N. appeared for the State.

Background

The police registered a suo motu case alleging that the petitioner had obtained Aadhaar numbers and photographs from customers who approached him to purchase SIM cards, used those particulars for unauthorised activations and attempted to sell the pre-activated cards to members of the public.

The prosecution alleged that the petitioner, while employed as a promoter for Jio, was authorised only to sell non-activated SIM cards. It alleged that 55 Jio SIM cards and 20 Vodafone SIM cards, activated in the names of different individuals, were found in his possession.

The petitioner submitted that the Jio SIM cards had been lawfully entrusted to him during his employment. He denied activating the cards or putting them to unlawful use and relied upon the Area Manager’s statement that promoters received only non-activated SIM cards.

The State relied upon a memo containing particulars of persons in whose names some of the recovered SIM cards had allegedly been activated. It submitted that the possession of 75 activated cards registered to unrelated persons required a full trial.

Court’s Observations

Unauthorised SIM Cards Create Wider Systemic Risks

The Court observed that the alleged facts raised concerns extending beyond the conduct attributed to an individual promoter. The Bench stated that the adequacy of systems governing the custody, distribution, activation and monitoring of SIM cards by mobile service operators also required examination.

The Court explained: “A SIM card is not merely a device for accessing a telecommunications network. It is also capable of being used as an instrument for establishing digital identity, receiving one-time passwords, registering online accounts, communicating with financial institutions and accessing services linked to a mobile number. Consequently, the unauthorised activation and circulation of SIM cards in the names of unsuspecting individuals may expose such individuals to identity misuse, financial fraud and other forms of cybercrime.”

The Court added that pre-activated SIM cards circulated without the registered persons’ knowledge or consent could conceal the actual users’ identities and complicate investigations into unlawful activities. However, the Bench clarified that it was not finding that the petitioner had committed cyber fraud or that any of the cards had been used for a further offence.

Police To Examine Unauthorised Activation Patterns

The Court directed the DGP, Cyber Command, to examine unauthorised SIM activation and circulation, their potential use in cyber-enabled offences and the difficulties faced by investigating agencies in identifying the cards’ actual users.

The Bench further directed the DGP to consider issuing instructions requiring jurisdictional police authorities to promptly examine credible information concerning unauthorised activation, possession or distribution. Appropriate action must be taken where a cognisable offence is disclosed.

The Court also asked the police authorities to consider whether cases involving multiple SIM cards activated through third-party identification particulars disclosed a wider pattern requiring coordinated investigation. The Bench stated that such consideration would remain subject to the governing legal requirements and the evidence available in each case.

Operators To Review Verification And Inventory Controls

The Court directed the DGP to issue appropriate directions requiring the concerned mobile service operators, including Jio and Vodafone to the extent relevant, to examine their procedures for appointing, authorising and supervising promoters, distributors and other intermediaries entrusted with SIM cards.

The review must cover the custody and movement of non-activated SIM cards, the recording of cards issued to and returned by intermediaries, customer verification before activation and the detection of departures from the authorised distribution process.

On inventory controls, the Court directed: “The Director General of Police, Cyber Command shall issue appropriate directions to the concerned mobile service operators to examine whether appropriate systems are in place to reconcile the SIM cards supplied to promoters and distributors with the SIM cards sold, returned, cancelled or otherwise accounted for. Such systems should, to the extent technically feasible and legally permissible, facilitate the identification of unexplained discrepancies between SIM cards issued to an intermediary and those subsequently activated or otherwise disposed of.”

The Court further required operators to review whether their systems could identify repeated or unusual activation activity associated with a particular intermediary, point of sale or distribution channel. The Bench clarified that relevant facts must be verified before adverse action is taken against any person.

Complaint And Corrective-Action Mechanisms

The Court directed the DGP to require operators to examine whether customers had an accessible and effective mechanism for reporting suspected unauthorised activations in their names.

The Bench stated: “The mechanism should enable complaints to be recorded, verified and acted upon within a reasonable period, in accordance with applicable law. The operators shall also consider appropriate means of informing affected customers of confirmed unauthorised activations and of facilitating necessary corrective action, including the rectification of inaccurate records and the prevention of further misuse, subject to the applicable legal and regulatory requirements.”

The Court also directed consideration of stronger instructions, training, supervision and accountability mechanisms for promoters, distributors and other authorised intermediaries.

Directions Do Not Authorise Indiscriminate Surveillance

The Court clarified that every measure considered or implemented must comply with telecommunications law and the legal requirements governing the collection, verification, retention, use and disclosure of customer identification particulars.

The Bench emphasised: “Nothing in these directions shall be construed as authorising indiscriminate surveillance, unrestricted access to customer data or disclosure of personal information otherwise than in accordance with law.”

The Court added that its directions were preventive and did not amount to a finding that the petitioner was guilty or that the SIM cards had been used to commit another offence.

Criminal Case Requires Trial

The Court held that the petitioner’s employment with Jio did not explain, at the quashing stage, his alleged possession of 20 Vodafone SIM cards. It further observed that the circumstances surrounding the cards’ activation, custody and proposed sale required oral and documentary evidence.

The Bench consequently held that the material did not justify quashing the proceedings. It clarified that each alleged offence must independently satisfy its statutory ingredients and that nothing in the order expressed an opinion on the petitioner’s ultimate guilt or innocence.

Conclusion

The Karnataka High Court dismissed the criminal petition and declined to interfere with the proceedings pending before the trial court.

Despite dismissing the petition, the Court directed that the matter be relisted on November 27, 2026, for the DGP, Cyber Command, to report compliance with the preventive directions. The High Court Government Pleader was directed to communicate the order to the DGP.

Cause Title: Mallikarjuna v. State of Karnataka (Neutral Citation: 2026:KHC:54091)

Click here to read/download Judgment