Fundamental Right Article 21 Freezing of Bank Account Karnataka Hcwatermark 400251

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IN
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R
IN THE HIGH COURT OF KARNATAKA
KALABURAGI BENCH
DATED THIS THE 30TH DAY OF AUGUST, 2021
BEFORE
THE HON’BLE MR. JUSTICE MOHAMMAD NAWAZ
WRIT PETITION NO.226989/2020 (GM-RES)
Between:
Sri Narayan Yadav

C/o Rambir Yadav,
Aged about 30 years,
R/o B-75, Patel Gardens,
Uttam Nagar, Near Dwarka Hospitals,
D.K.Mohan Gardens, Uttam Nagar,
West Delhi, Delhi - 110059.
… Petitioner
(By Sri S.Manoj Kumar and

Sri Anilkumar, Advocates)
And:
1. State of Karnataka
Through CEN Police Station, Yadgiri,
Shahapur, Yadgir,
Karnataka - 585 223.
Represented by Police Inspector.
2. MS.Ludra Mary,
D/o Jamesh Poul,
Aged about 30 years,
Primary Arogya Centre, Hatigudur,
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Shahapur, Yadgir,
Karnataka - 585 223.
… Respondents
(By Sri Mallikarjun Sahukar, HCGP R1;

R2 - served)
This petition is filed under Article 226 and 227 of

Constitution of India read with Section 482 of Code of
Criminal Procedure praying to quash the notice dated
22.06.2020 bearing No.08/CEN/PS/2020 passed by the
respondent No.1 to Axis Bank directing to freeze the
petitioner's bank account bearing No.27801010006117 as
per Annexure-A and other linked and connected accounts
and direct the petitioners bank to unfreeze the petitioner
all Bank accounts and to pass any other appropriate
orders.
This petition coming on for Hearing this day, the

Court made the following:
ORDER
Notice issued to respondent No.2 is served, but
respondent No.2 is not represented.
2. In this writ petition the petitioner has sought
to quash the notice dated 22.06.2020 at Annexure-A
issued by the Police Inspector, CEN Police Station, Yadgiri,
to the Manager of Axis Bank, Yadgiri for de-freezing
petitioner's account No.278010100061117 and linked
account numbers.
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3. The request at Annexure-A by the Police
Inspector, appears to be in connection with an
investigation relating to Crime No.4/2020 of Yadgiri CEN
Police Station which was registered on a complaint lodged
by respondent No.2.
4. The gist of the complaint is that, complainant
received a mail on 27.05.2020 stating that she has won
`48,47,80,346/- lottery and to transfer the said amount,
she has to login to certain user ID. Accordingly, she
entered the password and the user name provided and
filled-up the information requested. In response, she was
asked to deposit certain amount to the account numbers
provided. As such, between 06.05.2020 to 10.06.2020, a
total sum of `3,73,899/- was deposited to those accounts.
Thereafter, no amount as assured was transferred to her
account and thereby she was cheated by some unknown
persons.
5. The notice at Annexure-A to defreeze the bank
account pertaining to the petitioner appears to be on the

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ground that transaction of `99,999/- made by the
complainant to the Axis Bank account bearing
No.278010100061117, belong to the petitioner.
6. It is the contention of the learned counsel for
the petitioner that the petitioner is running Chain
Electronics Stores in Delhi. The proceeds of the business
were transferred to the premium company account that
was maintained at Axis Bank, Dwarka Branch, Delhi. It is
submitted that the petitioner was taken by surprise on
receiving an intimation from Axis Bank that his account
has been frozen and no debit card transactions can take
place, which is certainly on the basis of the complaint
lodged by respondent No.2. It is submitted that revised
notice is also issued ordering for a complete freezing of
petitioner’s current account and to freeze all the linked
accounts.
7. It is also contended that the petitioner is
nowhere involved in the crime that has been alleged and
freezing of the account of the petitioner, both business and

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personal has severely affected the livelihood of the
petitioner and he is unable to make ends meet as he has
no alternative source to meet his financial obligations.
8. The learned counsel for petitioner has further
contended that the petitioner is carrying out a legitimate
business and he is able to justify each credit transaction
that has taken place and therefore the freezing of
petitioner’s account, without following due procedure, is
wholly arbitrary.
9. The learned counsel for petitioner has also
contended that Crime No.4/2020 was registered by the
respondent/police on 29.06.2020 and even prior to
registration of the case, as per the endorsement in the
notice, the concerned bank has been intimated to freeze
petitioner's bank account on 22.06.2020. He submits that
the freezing of account by respondent No.1 without
informing the petitioner and without affording him an
opportunity is in violation of the principles of natural

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justice and also in violation of his fundamental rights under
Article 21 of the Constitution of India.
10. In support of his contention, the learned
counsel for the petitioner has relied on the following
decisions :-
i. Mr.Prakash Padukone and others vs. State of

Karnataka
[W.P.No.13516-13518/2018 (GM-POLICE) -
4.04.2018];
ii. Smt.Neeta Shanthilal vs. State of Karnataka

[Crl.Pet.No.5847/2016 - 18.08.2016];
iii. Uma Maheshwari v. The State, Rep. by The Inspector

of Police, Central Crime Branch, Egmore, Chennai
Criminal O.P.Nos.15467 of 2013 and connected
matters dated 20.12.2013].
11. The learned High Court Government Pleader
would contend that as per complaint averments
complainant was asked to deposit certain amount and a
sum of `99,999/- was deposited in the Axis Bank account
belonging to the petitioner. He contends that the
statement of accounts clearly disclose that the said
amount has been deposited on 26.05.2020 in the said

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account belonging to the petitioner. He therefore contends
that it was necessary for the Investigating Agency to
freeze the accounts belonging to the petitioner for the
purpose of investigation and also to avoid the petitioner
transacting further. He submits there is nexus between the
accused, petitioner and the fraud committed against the
complainant and therefore seeks to dismiss the petition.
12. As per Annexure-A the bank account
No.278010100061117 and the linked account numbers
belonging to the petitioner have been freezed. From the
material on record, it can be seen that the said notice was
issued in connection with the fraud alleged to have been
committed against respondent No.2 wherein she is duped
of `3,73,899/- by some unknown person. Since a sum of
`99,999/- was found deposited in the Axis Bank account
belonging to the petitioner, the said account as well as the
other linked accounts appears to have been freezed at the
request of the Investigating Officer.

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13. In 'Smt.Neeta Shanthilal' (supra) in a similar
circumstance, this Court has observed that such a freezing
of bank accounts is unfair and unjust.
14. In 'Prakash Padukone', (supra) it is observed
as under -
"This court is of the firm opinion that

unless and until there is a strong suspicion
against the petitioners, the police would not be
justified in freezing the account belonging to
the petitioners. For, such freezing of account
adversely affects the right to life under
Article 21 of Constitution of India. But, in order
to balance the conflicting interest of the
petitioners, with the interest of the
Investigating Agency, and the interest of the
complainant, in the interest of justice,
respondent Nos.1 and 2 are directed to de-
freeze the account belonging to the petitioners,
provided, the petitioner No.1 submits a bond of
`20,00,000/- (Rupees Twenty Lakh only)
before the learned Sessions Judge, before
whom the present case is pending."
15. It is also contended by the learned counsel for
petitioner that Section 102 of Code of Criminal Procedure,
which is mandatory, has not been followed while freezing
the bank account. He has relied on the decision in 'Uma

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Maheswari' (supra), disposed of on 20.12.2013 by the
High Court Judicature at Madras. Para 40 to 45 are
extracted hereunder -
"40. In VINOSHKUMAR RAMACHANDRAN

VALLUVAR VS. THE STATE OF MAHARASHTRA
[2011 (1) MWN (Cr.) 497 (FB)(Bom.)], a Full
Bench of the Bombay High Court held that the
requirement of reporting of freezing of bank
account to the Magistrate prescribed under
Section 102(3) Cr.P.C is mandatory in nature.
41. In pursuing investigation under
Section 102 Cr.P.C., the Code empowered the
police officers to deprive a person of his properties.
In this context, the phrase, "shall" employed in
Section 102(3) Cr.P.C, is held to be mandatory in
nature. Violation of it goes to the root of the
matter.
42. In K.MAHENDRAN Vs. STATE REP. BY

THE SUB INSPECTOR OF POLICE, XII TEAM,
CENTRAL CRIME BRANCH, CHENNAI, [2007 (1) MLJ
(Crl) 794], cited by the learned Senior Counsel for
the petitioner, a learned Single Judge of this Court
referring to section 105(E)(2) Cr.P.C. held that the
freezing of the Bank accounts will have no effect
unless it is confirmed by the Magistrate within 30
days of freezing of the Bank account.
43. The said Section 105(E) occurs in

Chapter VII-A of the Cr.P.C. The said Chapter
consisting of Section 105(A) to 105(L) was inserted
in the Code of Criminal Procedure on 20.7.1994 by
way of Central Act 14/1993. It is intended by way
of reciprocal arrangement for assistance in certain
matters and procedures for attachment or
forfeiture of the property. With regard to certain
extra-territorial activity, in other words it is
intended for collecting evidence outside India and
matters connected thereto in India elaborate
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procedure has been made in Section 105(A) to

105(L) Cr.P.C. In that connection in
Section 105(E)(2) Cr.P.C. confirmation within 30
days of seizure has been prescribed.
Section 105(E) Cr.P.C. has nothing to do with the
seizure provided in Section 102 Cr.P.C. Our case is
covered under Section 102 Cr.P.C. Let us focus our
attention only on Section 102 Cr.P.C.
44. The Investigation Officer has suspected

that the moneys swindled were secreted by the
accused persons in their Bank accounts. Thus, he
took steps to freeze the Bank accounts.
45. We have elaborately seen that such

freezing of the Bank accounts shall be reported to
the jurisdiction Magistrate. When it is to be
reported has been stated in Section 102(3) Cr.P.C.
It is stated therein that it shall be reported
"forthwith" to the jurisdiction Magistrate. The
reporting of the freezing of the Bank accounts is
mandatory. Failure to do so will vitiate the freezing
of the bank account. In this back drop of the
matter, the word "forthwith" shall mean
'immediately', 'without delay', 'soon'."
16. It is the contention that the freezing of bank
account of the petitioner was not reported forthwith to the
jurisdictional Magistrate, which is mandatory.
17. It is not in dispute that all the four bank
accounts of the petitioner have been freezed by virtue of
the notice issued by the Investigating officer. Certainly
such freezing of account would adversely affect his right to

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life under Article 21 of the Constitution of India. According
to the complaint, she was duped of `3,73,899/- and it is
alleged that a sum of `99,999/- was deposited in the Axis
bank Account No.278010100061117 of the petitioner. The
petitioner has undertaken to offer sufficient bank
guarantee and also to abide by conditions. Hence, to meet
the ends of justice, the respondent No.1 is directed to
intimate the concerned banks to defreeze the accounts,
provided the petitioner offering a bank guarantee for a
sum of `3,73,899/-. Petitioner shall make himself available
for the purpose of investigation whenever required.
18. Petition is allowed in the above terms. No
order as to costs. I.A–1/2021 is disposed of.
Sd/-
JUDGE
sn

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DATED THIS THE 30TH DAY OF AUGUST, 2021

THE HON’BLE MR. JUSTICE MOHAMMAD NAWAZ

WRIT PETITION NO.226989/2020 (GM-RES)

Sri Narayan Yadav

(By Sri S.Manoj Kumar and

(By Sri Mallikarjun Sahukar, HCGP R1;

This petition is filed under Article 226 and 227 of

This petition coming on for Hearing this day, the

Notice issued to respondent No.2 is served, but

respondent No.2 is not represented.

2. In this writ petition the petitioner has sought

to quash the notice dated 22.06.2020 at Annexure-A

issued by the Police Inspector, CEN Police Station, Yadgiri,

to the Manager of Axis Bank, Yadgiri for de-freezing

petitioner's account No.278010100061117 and linked

3. The request at Annexure-A by the Police

Inspector, appears to be in connection with an

investigation relating to Crime No.4/2020 of Yadgiri CEN

Police Station which was registered on a complaint lodged

4. The gist of the complaint is that, complainant

received a mail on 27.05.2020 stating that she has won

`48,47,80,346/- lottery and to transfer the said amount,

she has to login to certain user ID. Accordingly, she

entered the password and the user name provided and

filled-up the information requested. In response, she was

asked to deposit certain amount to the account numbers

provided. As such, between 06.05.2020 to 10.06.2020, a

total sum of `3,73,899/- was deposited to those accounts.

Thereafter, no amount as assured was transferred to her

account and thereby she was cheated by some unknown

5. The notice at Annexure-A to defreeze the bank

account pertaining to the petitioner appears to be on the

ground that transaction of `99,999/- made by the

complainant to the Axis Bank account bearing

No.278010100061117, belong to the petitioner.

6. It is the contention of the learned counsel for

the petitioner that the petitioner is running Chain

Electronics Stores in Delhi. The proceeds of the business

were transferred to the premium company account that

was maintained at Axis Bank, Dwarka Branch, Delhi. It is

submitted that the petitioner was taken by surprise on

receiving an intimation from Axis Bank that his account

has been frozen and no debit card transactions can take

place, which is certainly on the basis of the complaint

lodged by respondent No.2. It is submitted that revised

notice is also issued ordering for a complete freezing of

petitioner’s current account and to freeze all the linked

7. It is also contended that the petitioner is

nowhere involved in the crime that has been alleged and

freezing of the account of the petitioner, both business and

personal has severely affected the livelihood of the

petitioner and he is unable to make ends meet as he has

no alternative source to meet his financial obligations.

8. The learned counsel for petitioner has further

contended that the petitioner is carrying out a legitimate

business and he is able to justify each credit transaction

that has taken place and therefore the freezing of