Freezes

Mumbai: In a significant ruling, the Bombay High Court has held that probe agencies can not `debit freeze' a bank account allegedly involved in cyber fraud transactions under the Bharatiya Nagarik Suraksha Sanhita (BNSS). A probe agency can put the disputed amount on lien, but cannot freeze the entire account, said a bench of Justices Anil Pansare and Raj Wakode at Nagpur in a judgment passed on Thursday. When a lien is put on an amount, only that particular amount can not be accessed, but the account can remain operational. Often in cyber frauds, a bank account is used for rerouting the proceeds without the account holder being aware of the transactions. Also ReadBLO dies by suicide in Gujarat, note blames SIR duty stress The order came on seven petitions filed by persons whose bank accounts were debit freezed under section 106 of the BNSS, as proceeds of alleged cyber frauds were credited to these accounts. Under the BNSS provision, an investigating agency has the power to seize property suspected of being stolen or linked to criminal activity. But the court pointed out that as per section 107 of the BNSS, police must approach a magistrate to seek attachment of any such property. "The law stands well-settled that under section 106, an investigating agency has no power to attach or debit freeze an account," the court said, quashing the orders issued by the police to debit freeze the accounts of the petitioners. The bench also noted that the `Citizen Financial Cyber Frauds Reporting and Management System', published by the Indian Cybercrime Coordination Centre under the Ministry of Home Affairs, throws light on how banks should deal with reports/ communications received from an investigating agency. "As could be seen from this system, bank/intermediaries can put the disputed amount on lien, but cannot debit freeze the account," the court said in its order. Despite this, some banks, upon receiving communications from an investigating agency which does not even call for debit freezing, proceed to take such action and cause loss to account holders, the HC said. "It is a mystery as to how the bank chose to debit freeze the accounts on their own," the HC said, and permitted the petitioners to seek compensation, if they wished, by filing appropriate proceedings.

Freezes

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