Freezing bank accounts jeopardise Article 21 of the constitution: Karnataka High Court

While accepting a plea submitted by Narayana Yadav, a New Delhi-based businessman, Justice Mohammed Nawaz made this observation and instructed the CEN police station in Yadgir to inform banks to de-freeze his accounts. The court stated that the de-freezing is conditional on the businessman honouring his promise to provide a bank guarantee in the amount of Rs 3.7 lakh. Yadav has appealed the police notification asking the manager of Axis Bank to freeze his account and four associated account numbers by June 22, 2020.

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“It is undeniable that the petitioner’s four bank accounts have been blocked as a result of the Investigating Officer’s notification.” Certainly, the freezing of his accounts would jeopardise his right to life as guaranteed by Article 21 of the Indian Constitution.”

The move was prompted by a complaint from Ludra Mary, a resident of Shahpur in Yadgir, who said that on May 27, 2020, she got an email informing her that she had won a lottery for Rs 48.5 lakh. She had to check in to a website in order to obtain the. She filled in the required details after entering the password and user name. A total of Rs 3.7 lakh was placed in such accounts till June 10, 2020, however, Ludra did not get the funds. Ludra went to the police, who ordered Yadav’s account to be frozen since his Axis Bank account had received Rs 99,999 from her.

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Finally, it was said that the authorities’ freezing of accounts without notifying the petitioner and giving him an opportunity to respond is a breach of natural justice principles as well as his basic rights under Article 21 of the Indian Constitution.

Advocates S Manoj Kumar and Anilkumar argued that the petitioner owns and operates a chain of electronic stores in Delhi and is not engaged in the alleged crime. It was alleged that the petitioner’s company earnings are transferred to an account that has now been frozen, leaving him unable to make ends meet and significantly affecting his livelihood. The petitioner stated that he can defend each credit transaction made from the accounts in question, and also the freezing of his account without due process is completely arbitrary.

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