Last Updated on October 19, 2023 by News Desk
The Kerala High Court recently directed banks to limit the freezing orders issued against traders into whose accounts unknown UPI payments have been made as a part of cybercrime.
The accounts of the traders, mostly retailers and small businessmen were frozen due to a transfer made by an unknown person into their accounts through UPI as a part of financial cybercrime. The investigating police authorities had issued an advisory to freeze such accounts. Aggrieved by their frozen bank accounts, traders filed a plea before the court, seeking its intervention in regard to the matter.
The petitioners alleged that they had faced huge losses and prejudices due to their frozen accounts, which are unavailable for the service. They claimed that the trust of the business community has been adversely affected and therefore sought the intervention of the court to safeguard their interests. “On account of the orders freezing their accounts in this fashion, the trust of the business community in the ‘UPI’ system has been severely shaken; and therefore, pray that this Court comes to their aid, issuing appropriate orders and safeguards.” It asserted.
Sri. Dayasindhu Sreehari, the learned Central Government Counsel, argued that the Ministry of Home Affairs does not have any further role to play in this matter and that it is for the police authorities concerned to inform this Court whether the investigations are still continuing and if the orders freezing the accounts of the petitioners require to be maintained.
The court, after noting all the facts, raised its concern about why the entire bank accounts of the petitioners were frozen when the exact amount credited to their accounts was known.
“One fails to fathom why their bank accounts in full should remain frozen. This is more so because, even when the sums in question may have been found credited in the accounts of the petitioners, unless the investigation eventually reveals that they were complicit in the Cyber Crime, or had received the same being aware of it, they could never be construed to be accused.” the court said.
The court further observed, “I am, therefore, of the firm view that certain specific safeguards will have to be now infused into the process, lest the people loose their faith in the ‘UPI’ system itself, especially when it is spear headed and recognised internationally as a vanguard initiative of India.”
Finally, the court directed the banks to confine the order of freeze against the accounts of the respective petitioners, only to the extent of the amounts mentioned in the order/requisition issued to them by the police authorities.
Case title: Dr. Sajeer v. Reserve Bank of India & Anr.
Written by Shagun Behal
Instagram- shagun_behal
