Allahabad High Court Rejects Private Company’s Petition Challenging Bank Official’s Seizure of Bank Account

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The Allahabad High Court has dismissed a petition by a limited company filed against the seizure of its bank account on the instructions of the investigator by the Bank.

The debit of the applicants (limited liability company and others) bank account was frozen on the instructions of the investigator dated 24.03.2022 by the Bank following the FIR lodged at the police station of Gomti Nagar, district of Lucknow Eastern ( Commissionerate Lucknow) on 16 September 2021 for an offense punishable under sections 409, 420, 467, 468, 471 IPC

Feeling aggrieved by the freezing of the debit from the applicants’ account on the instructions of the investigating officer, the application was filed by the applicants.

The contention of counsel for the applicants is that under section 102(3) of the Code of Criminal Procedure 1973 the seizure of a bank account must be immediately reported to the relevant magistrate having jurisdiction and this is mandatory in nature, as prescribed under Section 102(3) Cr.PC but in the present case, the investigating officer failed to report the seizure/freezing of the debit from the applicants account to the competent competent magistrate, hence the contested action to freeze the Applicants’ debtor account is contrary to the provisions of Section 102(3) Cr.PC, the entire proceeding against the Applicants is therefore subject to annulment.

On the other hand, the Government’s additional counsel argued that the question whether Section 102(3) Cr.PC is mandatory or directive, has already been decided by a co-ordinated bench of this Court in Allahabad in Criminal Misc. Written Petition No. 11201 of 2021: Amit Singh Vs. State of UP and others, decision of 18.04.2022, in which while finding that Section 102(3) Cr.PC is not mandatory but that it is directive, the Coordinating Chamber of the High Court dismissed the petition.

The Divisional Bench of Judge Ramesh Sinha and Judge Saroj Yadav observed that failure to report the seizure immediately, as provided for in Section 102(3) Cr.PC, will not ipso facto render the seizure unlawful, d especially since no deadline is specified and its consequences have not been provided. Thus, the petition in writ is also likely to be rejected.

Amit Singh vs. State Of UP and 3 others 2022 LiveLaw (AB) 207,

“(22) The petitioner’s bank account was frozen in the exercise of the powers granted under Section 102 Cr.PC and the Code of Criminal Procedure limits the release of this bank account only to an order made by the magistrate , which is not the case here. The provisions of the Code therefore cannot be circumvented on the ground that Article 300-A of the Constitution of India is violated. Simply because the freezing of the bank account does not is not reported immediately and reported only on a request made by the petitioner, it cannot be said that there is any violation of the right of ownership given under Section 300-A of the Constitution of India. of the petitioner in this regard is erroneous and untenable. The motion in writ is therefore devoid of merit and is dismissed. No order is made as to costs.”

Bearing in mind the aforesaid Judgment and Order dated 18.04.2022 (supra) and also taking into account the facts and circumstances of the case, the High Court is in full agreement with the opinion expressed by the Bench Coordinating Court in Allahabad void Judgment and Order of 18.04.2022 passed in the case of Amit Singh Vs. State of UP and others and hence the High Court dismissed the petition.


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