What Should You Do If Your Bank Account Has Been Frozen by the Cyber Cell in India?

To curb cybercrimes and fraudulent activities intended to cause monetary loss to one person and financial gain to another, investigating authorities may direct the concerned banks to freeze an account through which any part of the disputed transaction was received or withdrawn. This action helps the investigating authorities secure the victim’s money at the earliest stage. If such a measure is not taken, it may become extremely difficult to recover the disputed money and trace the offender.

However, it is undeniable that the actions of investigating authorities can adversely affect the lives of a large number of innocent people. To assist these innocent individuals, this article addresses the following questions:

1. What is the difference between a lien and a freeze on an account?

2. Can a police official ask a bank to freeze your entire account when the disputed amount is small?

3. What remedies are available against an account-freeze order or to remove a lien?

4. Is any other speedy and efficacious alternative remedy available?

Although technological advancements have made life easier, individual safety in every sphere has become a matter of concern. The scope of crime has widened, and criminals are no longer easily traceable. Earlier, it was easier to trace criminals because abundant direct or circumstantial evidence was often available. However, that is not always the case in the present technological era.

Difference Between a Lien and a Freeze on a Bank Account

What Is a Lien on a Bank Account (Hold on Disputed Amount)?

When an investigating officer or a court directs a bank to freeze an account, the account holder is prohibited from using the banking services associated with that account. In short, the account holder can neither withdraw nor spend the money held in that account.

What Is a Bank Account Debit Freeze by the Cyber Cell?

In the above context, a lien means that an investigating officer or a court directs the bank to seize or attach a particular amount of money in an account without restricting the account holder from using the other banking services associated with that account. Put simply, the only effect of such a direction is that the account holder cannot withdraw the amount subject to the lien.

Can Cyber Cell Police Freeze Your Entire Bank Account When the Disputed Amount Is Small?

Procedure Under Sections 106 and 107 of the Bharatiya Nagarik Suraksha Sanhita (BNSS), 2023

1. Bank Representation and NCRP Grievance Redressal Mechanism (GRM Portal)

Visit your bank and ask for the reason for the freeze and any other relevant details. Complete the customer due-diligence form and seek assistance from the bank so that the Grievance Officer can upload the relevant documents to the GRM (Grievance Redressal Mechanism) and make a representation on your behalf.

2. Representation Before the Investigating Officer (In Person or via Video Conference)

Appear before the concerned investigating officer and furnish the relevant documents to establish that the transaction was bona fide. If the direction to freeze the account or place a lien on a particular amount was issued by the cyber cell of another State, you may appear by video conference and furnish the relevant documents.

3. Application Before the Judicial Magistrate to Defreeze the Bank Account

You may also file an application before the concerned Judicial Magistrate seeking a direction to the bank to defreeze the account or remove the lien from the particular amount.

4. Writ Petition Before the High Court (Speedy and Efficacious Alternative Remedy)

An effective and speedy alternative remedy may also be available against an account-freeze order or a lien order: a writ petition before the concerned High Court.

Fundamental Rights Under Articles 19 and 21: Lien vs. Disproportionate Account Freeze

It is pertinent to mention that an investigating officer is required to issue such a direction strictly in accordance with the procedure prescribed under Sections 106 and 107 of the Bharatiya Nagarik Suraksha Sanhita, 2023.

How to Unfreeze a Bank Account Frozen by Cyber Cell or Remove a Lien: Legal Remedies

It is well established that banking services in today’s digital India form an important part of an individual’s life. Access to banking services is essential for carrying out daily activities and business operations, however small. Therefore, it falls within the ambit of the fundamental rights guaranteed under Article 19 and, implicitly, Article 21 of the Constitution of India. Accordingly, to balance individual and societal interests, as recognised by various High Courts, an investigating officer should place a lien on the disputed amount rather than direct the bank to freeze the entire account, as the latter course is harsh and disproportionate.