Kerala High Court
Yousafali Kolathekkatt Aydrosskutty vs State Of Kerala on 6 September, 2024
Author: V.G.Arun
Bench: V.G.Arun
2024:KER:68312
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE MR.JUSTICE V.G.ARUN
FRIDAY, THE 6TH DAY OF SEPTEMBER 2024 / 15TH BHADRA, 1946
WP(C) NO. 30489 OF 2024
PETITIONER:
YOUSAFALI KOLATHEKKATT AYDROSSKUTTY
AGED 56 YEARS
S/O AYDROSSUKUTTY, R/O KOLATTEHKKAT HOUSE, MMABIKADAVU,
TALIKKULAM, KERALA, PIN-680569
BY ADVS.
GAYATHRI MURALEEDHARAN
ARATHY P.
ARCHANA B.
RESPONDENTS:
1 STATE OF KERALA
REPRESENTED BY THE HOME SECRETARY, HOME DEPARTMENT,
GOVERNMENT SECRETARIAT, THIRUVANANTHAPURAM,KERALA,
PIN-695001
2 THE RESERVE BANK OF INDIA
REPRESENTED BY ITS GOVERNER, HEAD OFFICE, MUMBAI,
MAHARASHTRA, PIN-400029
3 AXIS BANK
KOCHI BRANCH, 41/419, GROUND FLOOR CHICAGO PLAZA,
RAJAJI ROAD, ERNAKULAM, PIN-682035
4 STATION HOUSE OFFICER
CANTONMENT POLICE STATION, CHHATRAPATI SAMBHAJINAGAR
CITY, PURA ROAD, MAHARASHTRA, PIN-411001
5 STATION HOUSE OFFICER
KASHINGAON POLICE STATION, SILVER SARITA, VINAY NAGER,
KASHINGAON MIRA ROAD (E), PIN-401107
WP(C)No.30489 of 2024 2024:KER:68312
2
6 NATIONAL CYBER CRIME REPORTING PORTAL
NATIONAL HIGH WAY- MAHPALPUR, NEW DWLHI, REP BY ITS
DIRECTOR, PIN-110037
DSGI IN CHARGE T.C. KRISHNA. SRI. P.S. APPU,
GOVERNMENT PLEADER. SRI. PRADEESH CHACKO FOR BANK.
THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON
06.09.2024, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:
WP(C)No.30489 of 2024 2024:KER:68312
3
JUDGMENT
Dated this the 6th day of September, 2024
The petitioner is aggrieved by the sudden freezing
of his account by the bank based on
requisitions/intimation received from the police. The
police in turn has acted on the basis of Cyber Crime
Incident Reports filed by persons subjected to online
financial fraud/UPI fraud.
2. Learned counsel for the petitioner submitted
that this Court in Dr.Sajeer v. Reserve Bank of
India [2024 (1) KLT 826] has addressed the plight of
similarly situated persons, and after elaborately
dealing with the revolutionary change in money
transactions with the advent of Unified Payment
Interface (UPI for short), as also the positives and
negatives of UPI transactions in the context of Cyber
crimes and Online fraud, the writ petitions were
WP(C)No.30489 of 2024 2024:KER:68312
disposed of with certain directions. The petitioner is
also seeking disposal of his case in similar manner.
3. Heard learned Counsel for the petitioner, the
Standing Counsel for the bank, Central Government
Counsel and the learned Government Pleader.
4. For convenience, the directions in
Dr.Sajeer's case (supra) is extracted hereunder:-
" a. The respondent Banks arrayed in these cases, are
directed to confine the order of freeze against the
accounts of the respective petitioners, only to the
extent of the amounts mentioned in the
order/requisition issued to them by the Police
Authorities. This shall be done forthwith, so as to
enable the petitioners to deal with their accounts, and
transact therein, beyond that limit.
b. The respondent - Police Authorities concerned are
hereby directed to inform the respective Banks as to
whether freezing of accounts of the petitioners in
these Writ Petitions will require to be continued even
in the afore manner; and if so, for what further time,
within a period of eight months from the date of
receipt of a copy of this judgment.
c. On the Banks receiving the afore
information/intimation from the Police Authorities,
they will adhere with it and complete necessary action
WP(C)No.30489 of 2024 2024:KER:68312
- either continuing the freeze for such period as
mentioned therein; or withdrawing it, as the case
may be.
d. If, however, no information or intimation is
received by their Banks in terms of directions (b)
above, the petitioners or such among them, will be at
full liberty to approach this Court again; for which
purpose, all their contentions in these Writ Petitions
are left open and reserved to them, to impel in
future."
5. While I am in respectful agreement with the
above directions, I also consider it apposite to
scrutinise the issue in the context of the applicable
provision and the precedents on the point. The
intimation from the police, in most of the cases, refers
to Section 102 of Cr.P.C., which, no doubt, is the
applicable provision. Hence, Section 102 is extracted
hereunder for easy reference. Here, it is essential to
note that Section 106 of the Bharatiya Nagarik
Suraksha Sanhita, 2023, which is the corresponding
provision, is also identically worded.
WP(C)No.30489 of 2024 2024:KER:68312
"Section 102:- Power of police officer to seize
certain property- (1) Any police officer may seize
any property which may be alleged or suspected to
have been stolen, or which may be found under
circumstances which create suspicion of the
commission of any offence.
(2) Such police officer, if subordinate to the officer
in charge of a police station, shall forthwith report the
seizure to that officer.
(3) Every police officer acting under Sub-Section (1)
shall forthwith report the seizure to the Magistrate
having jurisdiction and where the property seized is
such that it cannot be, conveniently transported to
the Court or where there is difficulty in securing
proper accommodation for the custody of such
property, or where the continued retention of the
property in police custody may not be considered
necessary for the purpose of investigation, he may
give custody thereof to any person on his executing a
bond undertaking to produce the property before the
Court as and when required and to give effect to the
further orders of the Court as to the disposal of the
same.
Provided that where the property seized under Sub-
Section (1) is subject to speedy and natural decay
and if the person entitled to the possession of such
property is unknown or absent and the value of such
property is less than five hundred rupees, it may
forthwith be sold by auction under the orders of the
WP(C)No.30489 of 2024 2024:KER:68312
Superintendent of Police and the provisions of
sections 457 and 458 shall, as nearly as may be
practicable, apply to the net proceeds of such sale."
6. A reading of Section 102, makes it clear that
the police has the power to seize any property which
may be alleged or suspected to have been stolen, or
which may be found under circumstances which create
suspicion of the commission of any offence. The Apex
Court in State of Maharashtra v. Tapas D Neogy
[(1999) 7 SCC 685] has held that the bank account of
the accused or any of his relatives can be treated as
"property" for the purpose of Section 102 of the Code.
Later, in Teesta Atul Setalvad v. State of Gujarat
[(2018) (2) SCC 372], the Supreme Court also held
that the Investigating Officer can issue instruction to
seize the suspected bank accounts, subject to his
submitting a report to the Magistrate concerned, as
mandated in sub-section (3) of Section 102.
Thereafter, another issue arose with respect to cases in
which there was delay in reporting the seizure to the
WP(C)No.30489 of 2024 2024:KER:68312
Magistrate. This led to divergent views being
expressed by different High Courts. Some High Courts
held that delayed reporting to the Magistrate would,
ipso facto, vitiate the seizure order; certain other High
Courts held that the delay in reporting would constitute
a mere irregularity and would not vitiate the seizure
order. The issue was set at rest by the Supreme Court
in Shento Varghese v. Julfikar Husen and others
[2024 SCC OnLine SC 895]. For that purpose, a
comparative analysis of the legislative history of
Section 102 Cr.PC was undertaken. After elaborate
discussion, the Apex Court held in Shento Varghese's
case (supra) as under:-
"22.From the discussion made above, it would emerge
that the expression 'forthwith' means 'as soon as may
be', 'with reasonable speed and expedition', 'with a
sense of urgency', and 'without any unnecessary
delay'. In other words, it would mean as soon as
possible, judged in the context of the object sought to
be achieved or accomplished.
23. We are of the considered view that the said
expression must receive a reasonable construction
WP(C)No.30489 of 2024 2024:KER:68312
and in giving such construction, regard must be had
to the nature of the act or thing to be performed and
the prevailing circumstances of the case. When it is
not the mandate of the law that the act should be
done within a fixed time, it would mean that the act
must be done within a reasonable time. It all depends
upon the circumstances that may unfold in a given
case and there cannot be a straight-jacket formula
prescribed in this regard. In that sense, the
interpretation of the word 'forthwith' would depend
upon the terrain in which it travels and would take its
colour depending upon the prevailing circumstances
which can be variable.
24. Therefore, in deciding whether the police officer
has properly discharged his obligation under Section
102(3) Cr. P.C., the Magistrate would have to, firstly,
examine whether the seizure was reported forthwith.
In doing so, it ought to have regard to the
interpretation of the expression, 'forthwith' as
discussed above. If it finds that the report was not
sent forthwith, then it must examine whether there is
any explanation offered in support of the delay. If the
Magistrate finds that the delay has been properly
explained, it would leave the matter at that. However,
if it finds that there is no reasonable explanation for
the delay or that the official has acted with deliberate
disregard/wanton negligence, then it may direct for
appropriate departmental action to be initiated against
such erring official. We once again reiterate that the
WP(C)No.30489 of 2024 2024:KER:68312
act of seizure would not get vitiated by virtue of such
delay, as discussed in detail herein above."
7. Thus it is no longer open for any person to
contend that the delay in complying with Section 102
Cr.P.C would vitiate the seizure as such. This gives rise
to an ancillary question, as to the impact of non-
compliance of Section 102(3), by the failure on the
part of the police officer concerned to report the
seizure of bank account to the jurisdictional Magistrate.
In my opinion, this question has to be addressed in the
light of Article 300A of the Constitution of India, which
stipulates that no person shall be deprived of his
property except by authority of law. The authority of
law in the cases under consideration is conferred by
Section 102 Cr.P.C. Therefore, abject violation of the
procedure prescribed therein will definitely affect the
validity of the seizure. While on the subject, it will be
profitable to refer the well considered judgment
rendered by a learned single Judge of this Court in
WP(C)No.30489 of 2024 2024:KER:68312
Madhu K v. Sub Inspector of Police and others
[2020 (5) KLT 483]. Therein, the practice of certain
police officers of directing freezing of accounts without
reporting to the Magistrate concerned was deprecated.
As rightly observed in the judgment, the police officer
acting under Section 102 Cr.P.C cannot be permitted to
arrogate to himself an unregulated and unbridled
power to freeze the bank account of a person on mere
surmise and conjuncture, since such unguarded power
may bring about drastic consequences affecting the
right to privacy as well as reputation of the account
holder. The other relevant portion of that judgment
reads as under:-
"If it finds that the report was not sent forthwith, then
it must examine whether there is any explanation
offered in support of the delay. If the Magistrate finds
that the delay has been properly explained, it would
leave the matter at that. However, if it finds that there
is no reasonable explanation for the delay or that the
official has acted with deliberate disregard/wanton
negligence, then it may direct for appropriate
departmental action to be initiated against such erring
WP(C)No.30489 of 2024 2024:KER:68312
official. We once again reiterate that the act of seizure
would not get vitiated by virtue of such delay, as
discussed in detail herein above."
The learned single Judge finally held that the breach of
procedure can be considered as irregular and not
illegal.
8. The above discussion leads to the conclusion
that, while delay in forthwith reporting the seizure to
the Magistrate may only be an irregularity, total failure
to report the seizure will definitely have a negative
impact on the validity of the seizure. In such
circumstances, account holders like the petitioner, most
of whom are not even made accused in the crimes
registered, cannot be made to wait indefinitely hoping
that the police may act in tune with Section 102 and
report the seizure as mandated under Sub-section (3)
at some point of time. In that view of the matter, the
following direction is issued, in addition to the
directions in Dr.Sajeer (supra).
WP(C)No.30489 of 2024 2024:KER:68312
(i) The police officer concerned shall inform the
banks whether the seizure of the bank account has
been reported to the jurisdictional Magistrate and if
not, the time limit within which the seizure will be
reported. If no intimation as to the compliance or the
proposal to comply with the Section 102 is informed to
the bank within one month of receipt of a copy of this
judgment, the bank shall lift the debit freeze imposed
on the petitioner's account.
(ii) In order to enable the police to comply with
the above direction the bank, as well as the petitioner,
shall forthwith serve a copy of this judgment to the
officer concerned and retain proof of such service.
Ordered accordingly.
Sd/-
V.G.ARUN
JUDGE
BG/SSK
WP(C)No.30489 of 2024 2024:KER:68312
APPENDIX OF WP(C) 30489/2024
PETITIONER EXHIBITS
EXHIBIT P1 THE TRUE COPY OF THE AUTHORIZATION LETTER
ISSUED BY THE MANAGING PARTNER OF THE SNAP
CINE DIGITAL DATED 22.05.2024
EXHIBIT P2 THE TRUE COPY OF NOTICE SENT BY THE 5TH
RESPONDENT POLICE STATION TO THE 3RD
RESPONDENT BANK, UNDER SECTION 94 AND 106
OF BHARTIYA NAGARIK SURAKSHA SANHITA, 2023
DATED 22.08.2024
RESPONDENTS EXHIBITS NIL
TRUE COPY
P.A. TO JUDGE
