Delhi HC Warns Agencies: No blanket freezing of bank accounts
The Delhi High Court urged probe agencies to avoid blanket freezing of bank accounts. Justice Manoj Jain addressed a case where an agency froze a company’s account with over ₹93 crore, citing a ₹200 entry.
The court warned that such actions without justification could severely impact account holders. It stressed the need for care, caution, and compassion. Instead of freezing accounts entirely, agencies should mark a lien on disputed amounts to minimize hardship.
The court noted a surge in similar cases and asked the Union Ministry of Home Affairs to create a uniform policy. It directed the ministry to consult stakeholders, including states and union territories, to draft standard guidelines.
The case involved a company that was neither a suspect nor linked to the crime. The court observed that cyber-criminals often misuse innocent parties in financial frauds. Agencies, in their pursuit of fraudsters, end up freezing accounts of those with no fault.
In this case, instead of securing only ₹200, authorities froze the entire account. The court acknowledged the investigating agency’s power but stressed the need for reasoning when taking such actions.
Unjust freezing of accounts can disrupt small vendors’ businesses and endanger livelihoods. The petitioner suffered financial setbacks, dishonored cheques, and operational disruptions.
The court emphasized balancing victims’ rights with the rights of innocent account holders. It urged probe agencies to act with responsibility and avoid unnecessary financial distress.
