Having your bank account frozen can be a distressing experience, especially if it happens without prior notice. In India, this usually occurs when investigating cyber crime or fraudulent activities. Suppose a particular police station or cyber cell has frozen your account or marked a lien. In that case, it is essential to understand the reasons behind it and the steps you can take to resolve the situation. This guide outlines a clear legal process to help you unfreeze your account effectively.

1. Understand the reasons behind the freeze

Understanding why the police froze your account is the first step towards regaining control. While tracking fraudulent transactions, the police typically freezes all the accounts that received a part of the source transaction. Account freezing can happen even if you do not have direct involvement with the incident.

2. Contact your bank’s home branch for information

Immediately contact your home branch for detailed information regarding the freeze. Ideally, your branch manager should share the notice or email they have received from the concerned law enforcement agency. If not, you should at least ask for the following pieces of information:

• Name of the police station
• Complaint/FIR number
• Name of the officer-in-charge
• Contact details

This will help you understand the nature of the investigation and how to proceed further.

3. Gather essential documentation

You should collect all the relevant documents that can support your case. This includes:

• Transaction records: Details of the transactions marked as suspicious, leading to your account being frozen
• Proof of income: Documenting proving the legitimate source of your funds, such as salary slips, business earnings, contracts, payment screenshots, etc.
• Communication records: Any relevant communication related to the transaction in question with any other third parties.

 4. Consult a lawyer

We usually recommend getting legal and professional help as soon as possible. Consider consulting a lawyer who specialises in cyber crime or financial disputes. A legal expert can offer crucial advice on how to proceed and represent you in your formal communication with the police. This step is essential if the situation complicates further or escalates. While you can engage a lawyer in your city, it is more beneficial to engage a lawyer from the same city as the police station, which has frozen your account. Why? We will discuss this in point 7.

Having coordinated legal assistance in over 600 such incidents across the country, we cannot stress enough the importance of engaging a lawyer at the right time and before it is too late.

5. Communicate with the police station

The police station can be general or specialised, such as a full-fledged cyber crime police station. With your lawyer’s guidance, initiate communication with them. It is necessary to communicate clearly and professionally, providing all requested information and documentation. Demonstrating your willingness to cooperate can positively influence the investigation’s outcome.

6. Submit a representation to the investigating authority

You may need to submit a formal representation to the concerned police station. You will need to explain your situation and provide evidence to support the legitimacy of your account activities. As per Section 102 of the Code of Criminal Procedure, 1973 (or Section 106 of the Bhartiya Nagrik Suraksha Sanhita, 2023), the investigating authority has the discretion to release seized property. This includes bank accounts if continued retention is not necessary for the investigation.

7. File an application with the jurisdictional Magistrate

If the investigating authority does not resolve the issue, you must move an application under Section 451 or 457 of the Code of Criminal Procedure, 1973 (Section 499 or 505 of the Bhartiya Nagrik Suraksha Sanhita, 2023). These provisions allow the Magistrate to order the release of seized property, including bank accounts. The Magistrate can require you to execute a bond or deliver the property directly to you if you prove rightful ownership.

In most cases, the Magistrate’s court should give you the desired relief, provided you have a decent lawyer who understands how tracking transactions works. We have seen cases where the lawyers could not explain P2P (peer-to-peer) transactions to the judge. This essentially prevented their clients from getting the desired result, even after having all the necessary documentation.

8. Consider approaching the High Court

If the jurisdictional Magistrate rejects your application, you may consider filing a petition before the concerned High Court. You can file a writ petition alleging that continued freeze without FIR violates your fundamental rights. This includes the right to livelihood under Article 21 or protection against arbitrary actions under Article 14. However, we have seen that some High Courts require a petitioner to exhaust all other remedies first.

Miscellaneous Tips

• Follow-up: Throughout the process, ensure that you regularly follow up with your bank’s home branch, the police station, and your lawyer. Staying informed and proactive can avoid delays and help expedite the resolution of your case.
• Seeking professional help: There is no harm in trying to do this yourself. If you find the process overwhelming or if your initial attempts do not yield results, remember that professional help is always available. Law firms specialising in cyber law, financial disputes, and litigation can provide the necessary expertise to navigate the complexities of the legal system and advocate on your behalf, giving you the support and guidance you need.

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