SC agrees to examine plea for SOP on freezing, de-freezing of bank accounts

New Delhi: The Supreme Court on Tuesday agreed to examine a petition seeking directions to the Union government and the Reserve Bank of India to put in place a uniform Standard Operating Procedure governing the freezing and de-freezing of bank accounts during cybercrime investigations.

A bench comprising Justices Pankaj Mithal and S V N Bhatti directed that a copy of the plea be served on the Centre within three days and listed the matter for hearing next week.

The petition seeks nationwide guidelines for investigating agencies, including cyber cells, to ensure that bank accounts are not frozen without a written and reasoned order, and that account holders are informed of such action within 24 hours. It also calls for safeguards to prevent prolonged restrictions on access to funds without due process.

Filed by Vivek Varshney through advocate Tushar Manohar Khairnar, the plea alleges that Varshney’s bank accounts were frozen by the Cyber Cell of the Tamil Nadu police without prior notice, communication or judicial approval. The petitioner claimed this action violated his fundamental rights under Articles 19(1)(g) and 21 of the Constitution. “Direct the respondent Union of India and the Reserve Bank of India to formulate a uniform Standard Operating Procedure governing freezing and de-freezing of bank accounts during cybercrime investigations, so as to prevent arbitrary action and ensure procedural fairness nationwide,” the plea stated.

According to the petition, the freezing of Varshney’s accounts resulted in “complete financial paralysis”, preventing him from meeting professional and personal obligations, including payment of essential expenses, taxes and liabilities. The plea noted that the account was allegedly frozen in connection with a transaction related to the sale of jewellery.

The petitioner further contended that the procedure followed by the authorities did not comply with statutory requirements. It pointed to Section 106(3) of the Bharatiya Nagarik Suraksha Sanhita and Section 102(3) of the Code of Criminal Procedure, which require that any seizure or freezing of property be promptly reported to the jurisdictional magistrate. “In the instant case, no such compliance has been made,” the plea said, describing the action as without jurisdiction and unconstitutional.

The petition highlighted the absence of a uniform protocol for freezing and unfreezing bank accounts during cybercrime or financial investigations. As a result, it said, citizens in different

states face inconsistent practices, extended freezing periods and loss of access to funds without adequate safeguards.

Along with seeking immediate de-freezing of his accounts, Varshney urged the court to frame uniform guidelines to ensure proportionality and accountability in future cases. He also requested directions to the Ministry of Home Affairs to formulate a standard policy for instances where cyber cells issue notices freezing bank accounts, arguing that accounts should not be entirely frozen unless the holder is shown to be complicit in an offence.