Police freezing of a bank account without court order during investigation, defreeze ordered as police request was illegal

The dominant issue was whether the police could freeze a bank account solely on an investigating officer's instruction without a judicial order. The HC held that, consistent with other HCs' interpretation of the power to freeze accounts, the investigating officer must obtain an order from the competent court during investigation; absent any order under the relevant CrPC/BNSS provisions, the direction to the bank was ultra vires and illegal. As no judicial authorization was produced and the freeze was based only on the police request, the HC directed the bank to defreeze the petitioner's account and permit its operation, and disposed of the petition.

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ISSUES PRESENTED AND CONSIDERED

1. Whether a bank account can be frozen solely on an investigating officer's written direction, in the absence of any order obtained from a competent court/magistrate under the applicable criminal procedure provisions.

2. Whether, on the facts placed before the Court, the freezing instruction and consequential freezing of the account was legally sustainable, and whether a direction for defreezing ought to be granted.

ISSUE-WISE DETAILED ANALYSIS

Issue 1: Legality of freezing a bank account only on an investigating officer's instruction without a court/magistrate order

Legal framework: The Court considered the position that debit freezing/attachment of a bank account during investigation requires an order of the competent court/magistrate under the relevant criminal procedure provisions dealing with attachment/freezing, and that an investigating agency cannot, by itself, effect such debit freeze merely by issuing a request/communication to a bank.

Interpretation and reasoning: The Court found as a fact that the account was frozen by the bank solely on the investigating officer's letter. Despite notice, the investigating authorities did not appear and no material was produced to show that any order had been obtained from a magistrate/court authorising the freezing. The Court relied on the legal principle, as applied in the judgment it discussed, that absent such judicial authorisation, an investigating officer's request cannot sustain a debit freeze of an account.

Conclusion: The direction to freeze the account, issued without any court/magistrate order, was held to be bad in law, and the bank's freezing action based only on such instruction could not be sustained.

Issue 2: Entitlement to relief of defreezing and restoration of account operations

Interpretation and reasoning: The Court noted that after the initial instruction to freeze, there was no further communication from the investigating officer to the bank. It further noted the absence of any judicial order backing the freezing, despite opportunities for the authorities to appear and justify the action. On this basis, and having held the freezing instruction unlawful, the Court determined that continued freezing could not be permitted.

Conclusion: The Court directed the bank to defreeze the account and permit the account holder to operate it.

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