Bank Account Frozen Over 'Suspicious Transaction' Of ₹200, Delhi HC Asks Probe Agencies To Show Compassion To Innocent Traders

It observed, “In such types of cyber-crimes, if any fraudster cheats a complainant and with the help of cheated money, when such fraudster buys something using such money, the police, chasing such money-trail, directs freezing the bank accounts of all concerned and in the process, many innocent recipients have to bear the brunt, for no fault of theirs.”

Justice Manoj Jain thus asked the Union Ministry of Home Affairs to consider consulting all stakeholders and chalk-out a SOP to ensure that such cases are handled with requisite consideration and compassion.

The bench was dealing with a petition filed by a logistics company, whose bank account having a withdrawable balance of over ₹93 crore was frozen over an innocuous entry of Rs. 200/-.

During pendency of the matter however, the account was de-freezed by marking a lien of the disputed amount.

This prompted the Court to highlight the large number of similar cases plaguing its board.

Recently, in Pawan Kumar Rai vs. Union of India the Court had ordered to de-freeze the account of a "small-scale vendor" selling Chhole-Bhature for alleged cyber fraud of Rs. 105.

Court observed, “There is no qualm about competence of any such investigating agency to issue such direction to the bank. But, what this Court finds, is lack of exhibiting any reason while exercising the same…once it chooses to do so, it must offer some justification. Such blanket measure, if taken recourse to, without offering any reason, can certainly play havoc with the financial concerns of such account holders. In relation to small-time vendors, it can disrupt prospects of their mere existence, even. It is not difficult to imagine that any such action can put their lives in a complete disarray.”

Court also noted that there was nothing to suggest that the petitioner was a suspect; rather, it was seemingly an unintended beneficiary. It suggested that in such cases, investigating agencies can order the preservation of disputed amounts.

“Possibility of marking a lien on disputed amount, whenever it is identifiable, should be explored as a more appropriate interim measure. Ideally, it should be the first and foremost option. This would, naturally, mitigate the undue hardship being caused on account of blanket freezing of account and would also ensure that the alleged cheated money remains secured and intact,” Court said.

Similarly, in Dr. Sajir Vs. Reserve Bank of India (2023) the Kerala High Court had directed Banks to limit the freezing orders issued in respect of persons into whose accounts amounts had been transferred via UPI platform as part of a cyber financial crime, to the amount involved in the crime as mentioned in the order/requisition issued by the Police Authorities.

“The aim should be to balance the rights of a complainant in any such criminal investigation vis-a-vis the right of innocent and unwary accountholder, made to face unwarranted hardship on account of blanket freezing of account, despite being completely innocent and unaware of commission of any crime,” Court finally said and disposed of the matter.

Appearance: Mr. Preetam Singh, Advocate for Petitioner; Mr. Premtosh K. Mishra, CGSC for UOI with Mr. Manish Vashist, Ms. Ms. Sanya Kalsi, Advocates and Gokul Sharma, G.P. Ms. Ritika Sisodiya, Advocate for respondent No.2/HDFC. Mr. Ramesh Babu with Ms. Tanya Choudhary and Mr. Rohan Srivastava, Advocates for RBI.

Case title: Neelkanth Pharma Logistics Pvt. Ltd. v. Union Of India & Anr.

Citation: 2025 LiveLaw (Del) 236

Case no.: W.P.(C) 17905/2024

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