Police cannot freeze bank accounts as alleged proceeds of crime without following statutory attachment procedure

Police power to seize or prohibit operation of a bank account is confined to property that is stolen, suspected to be stolen, or otherwise found under suspicious circumstances, and cannot be used as a substitute for attachment of alleged proceeds of crime. Under the Bharatiya Nagarik Suraksha Sanhita, 2023, attachment of property believed to be derived directly or indirectly from criminal activity must be sought through the prescribed judicial process before the jurisdictional Magistrate. A debit freeze based only on a transfer trail indicating possible proceeds of crime was therefore not sustainable as a direct police measure; restraint on the account had to follow the statutory attachment procedure.

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Issues: Whether the police could debit-freeze the petitioner's bank account in exercise of the power of seizure, or whether attachment of the alleged proceeds of crime had to be sought only before the jurisdictional Magistrate under the BNSS.

Analysis: The power recognised under the earlier criminal procedure regime to seize or prohibit operation of a bank account is confined to property that is stolen, suspected to be stolen, or found under circumstances creating suspicion of an offence. The later statutory scheme under the Bharatiya Nagarik Suraksha Sanhita, 2023 separately provides for attachment, forfeiture and restoration of property, and expressly requires the investigating officer to approach the Court or Magistrate for attachment of property believed to be derived, directly or indirectly, from criminal activity. The Court held that seizure under the old regime serves evidentiary purposes, whereas attachment under the new regime is designed to secure proceeds of crime and can be ordered only through the prescribed judicial process. On the facts, the debit freeze was founded on a transfer trail that may at best indicate proceeds of crime, which could not justify direct police freeze without invoking Section 107.

Conclusion: The debit freeze could not be sustained as a police measure under the seizure power, and any restraint over the account had to be obtained by following the attachment procedure before the jurisdictional Magistrate.

Final Conclusion: The petitioner succeeded, and the impugned restraint on the bank account was set aside while leaving it open to the investigating agency to pursue the statutory attachment process.

Ratio Decidendi: A bank account that is alleged to contain proceeds of crime cannot be frozen by police as a substitute for attachment where the governing statute requires recourse to the jurisdictional Magistrate for attachment of property derived from criminal activity.

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