Police Can Freeze Bank Accounts U/S 102 CrPC For Crimes Under Prevention Of Corruption Act: Kerala High Court

Kerala High Court has held that freezing of a person's bank accounts under Section 102 of Code of Criminal Procedure while investigating his involvement in offences under Prevention of Corruption Act (PC Act) is valid. Justice C. Jayachandran rejected the petitioner-accused's argument that the freezing should have been done only through the Criminal Law Amendment Ordinance, 1944.Advocate John S. Ralph who was appointed as the amicus had also submitted that when the 1944 Ordinance was a special statute made applicable to the offences under Prevention of Corruption Act, the general provision under Section 102 of CrPC cannot be resorted to. Section 18A of the PC Act has extended the applicability of the ordinance to the Act. The amicus further submitted that the ordinance provides additional safeguards to an accused like a mandatory judicial order along with an opportunity of hearing and to adduce evidence. The Court however held that these provisions had separate objectives and the seizure under CrPC cannot be found fault with. The Court said that Section 102 provides for seizure of property which is suspected to have been stolen or which is found in circumstances creating suspicion of commission of an offence. It observed that Section 102 is invoked as a step in aid of investigation, to seize a piece of evidence. On the other hand, the Ordinance aims to secure the money which has been procured by the accused by means of a scheduled offence so that the same can be forfeited if the accused is ultimately found guilty.The Court then relied on State of Maharashtra v Tapas D. Neogy (1999) where the Supreme Court had held that bank accounts come under the definition of property which can be seized under Section 102. Hence, the Court held that bank accounts can be seized under Section 102 of CrPC for offences under PC Act.Notably, diverse views have been taken by the High Courts of Madras and Patna with regard to applicability of Section 102 CrPC in seizure and freezing of bank accounts in a criminal case registered under the PC Act. While the Madras High Court has held in favor of such application, the Patna High Court has held that such seizure and freezing can be made only under Section 18A of PC Act. The Supreme Court is thus set to decide the issue.Background of the caseThe prosecution case was that Petitioner abetted and aided 1st accused, who was working as the Accountant of the Kerala Bar Council, to misappropriate an amount of Rs. 7.6 Crores from the Kerala Bar Council Welfare Fund. Crimes are under Section 109, 120B, 409, 420 and 477A of IPC r/w Sections 13(2) and 13(1)(c) of the PC Act were alleged against her and two of her bank accounts were freezed. It is challenging this order that she approached High Court, arguing that the attachment was done under Section 102 of CrPC without adhering to the provisions of Criminal Law Amendment Act. It was also argued that the seizure is illegal for non-compliance of Section 102(3) Cr.P.C in as much as the seizure was not reported to the Magistrate concerned.Non-Compliance With Section 102(3) is not Fatal To The SeizureThe Court relied on Supreme Court judgment in Shento Varghese v Julfikar Husen and Others (2024) which held that the obligation to report the seizure to Magistrate under Section 102(2) CrPC is not a jurisdictional pre-requisite to exercise the power of seizure nor is the seizure subject to compliance of Section 102(3). In that case, it was held that the delay in reporting will at best, dent the veracity of the prosecution case regarding the date, time and occasion for seizure of the property. The High Court in the instanct case held that it is open to the accused to show the prejudice regarding time, place of the articles seized during trial. It however cautioned the police that it was their duty to comply with Section 102(3) though non-compliance would not vitiate the seizure. The Court added that if the provision is not complied with, the right of the property holder to seek disposal of the property is seriously affected.It finally dismissed the petition directing the investigating officer to comply with Section 102(3) within one month.Counsel for the Petitioners: Advocates N. J. Mathews, Ashik K. Mohamed Ali, Mohamed Rifa P. M., Ramseena N.Counsel for the Respondents: Advocates Srrelal Warriar (Spl PP), M. U. Vijayalakshmi, Saijo Hassan, Nagaraj Narayanan, Rafeek V. K., Aathira Sunny, Bincy Job, Neema Neerackal, Ambadi Dinesh L. K., Salman Faris, K. Jaju BabuCase No: WP(Crl.) 1284 of 2022Case Title: Sreekala K. v Central Bureau of Investigation and OthersCitation: 2025 LiveLaw (Ker) 126Click Here To Read/ Download Order

Police Can Freeze Bank Accounts U/S 102 CrPC For Crimes Under Prevention Of Corruption Act: Kerala High Court

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Police Can Freeze Bank Accounts U/S 102 CrPC For Crimes Under Prevention Of Corruption Act: Kerala High Court

Manju Elsa Isac

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