Summary of the Case
The petitioner, Neelkanth Pharma Logistics Pvt. Ltd., approached the Court after its bank account at HDFC Bank was completely frozen. This action followed a directive from the Vartaknagar Police Station in Thane, Maharashtra, linked to a cybercrime investigation.
Despite the account having a withdrawable balance of over Rs. 93.5 crore, the entire account was frozen due to a single suspicious entry of only Rs. 200. This blanket freeze led to significant financial distress, including the dishonoring of cheques and the disruption of business operations.
Key Judicial Observations
The Court, presided over by Hon’ble Mr. Justice Manoj Jain, made several critical observations regarding the conduct of investigating agencies:
- Lack of Proportionality: The Court found it “difficult to comprehend” why an entire account should be frozen when a specific, small sum of disputed money has been identified.
- Violation of Rights: Citing previous manual, the Court noted that freezing an entire account without evidence of the holder’s complicity undermines the Right to Livelihood under Article 21 of the Constitution.
- Need for Compassion: Law enforcement agencies were urged to act with “care, caution and… compassion,” exploring the marking of a lien on the disputed amount as the primary interim measure instead of a total freeze.
- Innocent Recipients: The Court acknowledged that in cybercrime “money-trails,” many innocent recipients bear the brunt of investigations despite being unintended beneficiaries or completely unaware of any crime.
Final Decision and Directives
During the proceedings, a subsequent communication from the investigating agency directed the bank to remove the freeze and instead mark a lien of Rs. 200. Consequently, the petitioner chose not to press the petition further.
However, due to the recurring nature of these cases, the Court directed the Ministry of Home Affairs (MHA) to take proactive steps. The MHA is encouraged to consult stakeholders and establish a uniform policy or Standard Operating Procedure (SOP) to balance the rights of complainants with those of innocent account holders.