Independent criminal investigation may continue despite suspension of bank fraud classification, absent express restraint or demonstrated abuse of process.

Suspension of a borrower account's administrative fraud classification under the RBI framework does not restrain an independent criminal investigation into cognizable offences. Although the bank action and FIR may arise from overlapping facts, the investigation is not merely consequential to the regulatory classification. In the absence of an express restraint on criminal proceedings, CBI investigation and searches conducted under competent criminal court warrants may continue. Article 226 jurisdiction is not appropriate for resolving disputed allegations on affidavits regarding search execution, and cannot halt an investigation absent patent lack of jurisdiction, manifest mala fides, or clear abuse of process.

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Issues: Whether suspension of the administrative classification of the borrower account as fraud under the RBI framework barred the CBI from registering an FIR, continuing criminal investigation, and conducting searches pursuant to judicial warrants.

Analysis: The interim order concerning fraud classification was confined to its regulatory and administrative consequences. A criminal investigation into cognizable offences proceeds under an independent statutory regime; overlap between the factual basis of bank action and the FIR does not make the investigation a merely consequential administrative action. No express restraint against the investigating agency or criminal proceedings had been issued. The searches were conducted pursuant to warrants issued by the competent criminal court, and disputed allegations concerning their execution were not suitable for adjudication under Article 226 on competing affidavits. In the absence of patent lack of jurisdiction, manifest mala fides, or clear abuse of process, extraordinary writ jurisdiction could not be used to halt an investigation into serious allegations involving diversion of public funds.

Conclusion: Suspension of the fraud classification did not prohibit the FIR, criminal investigation, or search and seizure operations; no ground for interference with the ongoing investigation was established.

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