3 min readHyderabadMar 29, 2026 11:53 AM IST
The Telangana High Court earlier this month ordered the immediate unfreezing of a bank account belonging to a local business, emphasising that mechanical, arbitrary police action cannot indefinitely cripple a citizen’s financial autonomy without recorded reasons or legal safeguards.
The order was delivered on March 11 in a writ petition filed by The Bottle Restaurant and Bar, represented by its proprietor Kandibanda Sridhar. The petitioner approached the court after their account at the Kotak Mahindra Bank, Gandhi Chowk Branch, Khammam, was frozen in its entirety following an investigation into a crime with which they claimed to have no connection.
The petitioner stated that his name did not figure in the FIR, and no notice was issued to him. He further submitted that the action was not reported to the jurisdictional magistrate and that there was no response to his representation requesting that his account be unfrozen. The bank account was frozen on the instructions of the cybercrime wing of Etawah district, Uttar Pradesh.
Justice E V Venugopal strongly disapproved of the manner in which law enforcement agencies exercise their power to freeze accounts. While acknowledging that statutes empower agencies to freeze accounts pending investigation, the court clarified that this power is not absolute or perpetual.
The judge held, “Greezing of a citizen’s bank account, in the absence of any cogent reasons and without establishing even a prima facie nexus of such account with the commission of any cognisable offence, amounts to a grave and unwarranted intrusion into the fundamental rights guaranteed under the Constitution.”
The judge said ,“Such an action, taken in a mechanical and arbitrary manner, not only cripples the financial autonomy of an individual but also directly impinges upon the right to life and personal liberty of the account holder under Article 21 and the freedom to carry on trade, occupation and business under Article 19(1)(g).”
Highlighting that the power to interdict a bank account is an “exceptional one”, the judge said it must be used with circumspection. He stated: “Any freezing order passed dehors such safeguards betrays a colourable exercise of power, is manifestly arbitrary, and cannot be sustained in the eyes of law.”
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The court observed that although only a specific amount was disputed, the banks had frozen the account in its entirety. This blanket freeze was deemed a violation of the petitioner’s livelihood and fundamental rights.
To balance the interests of the investigation with the rights of the citizen, the court directed that only the disputed amount remain frozen, while the petitioner must be permitted to operate the account for all other lawful transactions.
The superintendent of police of the Etawah district was directed to “forthwith communicate” this order to the Kotak Mahindra Bank branch manager to ensure the account is unfrozen immediately without further delay. The writ petition was disposed of with no order as to costs.
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