Prayagraj: The Allahabad high court has expressed serious concern over the manner in which bank accounts are being frozen in cyber fraud investigations, observing that authorities cannot act in a mechanical or high-handed manner merely on the basis of communications from police or cybercrime units.
The court said freezing accounts without informing account holders of the reasons and without placing relevant documents on record violates principles of due process and leaves citizens in prolonged financial uncertainty.
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The observations came while hearing a writ petition filed by Tarkeswar Tiwari, who challenged the freezing of his bank account. The division bench noted that multiple petitions before it indicate a pattern in which banks freeze accounts citing instructions from investigating agencies but fail to disclose the underlying material to the account holders.
According to the court, when customers seek clarification, banks simply refer to letters received from police or cyber authorities. However, despite earlier directions, those communications have not been produced before the court, raising concerns about procedural transparency.
The bench directed the Centre to address the issue and consider framing clear guidelines to eliminate anomalies in the current system. It noted that several courts have dealt with similar grievances in the past, yet the problem persists at the ground level.
While acknowledging the importance of swift action in cyber fraud cases, the court stressed that such measures must be balanced with the protection of citizens’ rights. Any decision to freeze a bank account must be backed by proper documentation, clear reasons and adherence to a fair procedure.
The court also pointed out that prolonged freezing of accounts without sufficient justification can severely disrupt an individual’s financial activities and livelihood, particularly when no timeline or mechanism for review is provided.
During the hearing, questions were raised about whether an effective, time-bound remedy exists for account holders seeking relief. The court observed that the process must be structured in a manner that allows investigating agencies to act against fraud while ensuring that innocent customers are not subjected to undue hardship.
The issue has gained significance amid a rise in cyber fraud cases, where multiple accounts are often frozen based on suspicious transaction trails. In many instances, affected account holders are required to prove the legitimacy of their funds over extended periods before access is restored.
The court has sought a response from the Centre and indicated that in the absence of clear procedural safeguards, judicial intervention in such matters will continue.
About the author — Suvedita Nath is a science student with a growing interest in cybercrime and digital safety. She writes on online activity, cyber threats, and technology-driven risks. Her work focuses on clarity, accuracy, and public awareness.
