SC places petition seeking SOP on freezing accounts before CJI’s Bench

The Supreme Court has directed a petition seeking directions to the Centre and the RBI to formulate a Standard Operating Procedure (SOP) governing freezing and de-freezing of bank accounts during cybercrime probes to be placed before CJI Surya Kant for assigning it to an appropriate Bench.

A Bench led by Justice Pankaj Mithal on January 16 ordered the top court’s Registry to seek instruction from the CJI after the Centre informed it that a CJI-led Bench was already hearing a suo moto matter related to digital arrests.

The Supreme Court had earlier agreed to examine the plea that said no bank account should be frozen without a written reasoned order and intimation to the account holder within 24 hours of such action and every freezing order shall be forthwith reported to the jurisdictional magistrate as mandated under Section 106(3) of BNSS/ 102(3) of the CrPC.

The petitioner had also sought a direction to the Centre and the RBI to formulate a uniform SOP governing freezing and de-freezing of bank accounts during cybercrime investigations, so as to prevent arbitrary action and ensure procedural fairness nationwide.

At the outset, ASG Anil Kaushik informed the bench that the Centre had not freezed the bank accounts of petitioners, who alleged the action was taken without intimation.

On January 6, the top court had asked for a copy of the petition to be served on the Centre within three days, and listed the matter next week.

The petition also sought the issuance of appropriate guidelines to all investigating agencies, including cyber cells across the country, to ensure that no bank account was frozen without a written, reasoned order and intimation to the account holder within 24 hours of such action.

Petitioner Vivek Varshney said he was aggrieved by the “arbitrary freezing/holding” of his bank account(s) by the Cyber Cell of the Tamil Nadu police allegedly without any prior notice, communication or judicial approval, thereby violating his fundamental rights under Articles 19(1)(g) and 21 of the Constitution.

The freezing order in his case has resulted in complete financial paralysis, restricting him from carrying out his professional and personal obligations, including payment of essential expenses, taxes and liabilities, he said.

Section 106(3) of BNSS/102(3) of the CrPC mandates that any seizure or freezing of property must be forthwith reported to the jurisdictional magistrate. However, in the instant case, no such compliance was made, he contended.

Varshney, whose bank account was allegedly frozen due to transaction related to the sale of jewellery, submitted that his writ petition was filed to formulate a rule that unless an account holder was proven to be complicit in a crime, their entire bank account or amount more than alleged to be involved in the crime should not be frozen merely because a suspicious transaction has been traced to it.

He urged the court to direct the Ministry of Home Affairs to formulate a uniform policy and SOP in the cases of similar nature where cyber cell issues notices for freezing accounts.