Delhi court slams CBI for 'draconian' bank account freeze, orders unfreezing

A Delhi court has pulled up the CBI for what it described as the "completely arbitrary" and "draconian" freezing of the bank accounts of a man whose son-in-law is an accused in a Rs 3-crore bribery case, observing that criminal investigations cannot be used to harass relatives who have no demonstrable link to the alleged offence.

In an order passed on Tuesday, 7 July, special judge Sushant Changotra directed the agency to unfreeze three bank accounts belonging to Gulshan Kumar, holding that there was no material to show that the accounts had any connection with the alleged proceeds of crime.

"The arbitrary exercise of... discretion in freezing the bank accounts of individuals who do not have any direct or remote connection with the commission of offences is completely draconian in nature," the court said, adding that investigating agencies cannot "arbitrarily attach/freeze/seize the bank accounts or other valuable assets of individuals on their whims".

The court was hearing Gulshan Kumar's plea, filed through advocate Prateek Som, challenging the freezing of his accounts as illegal. Noting that Gulshan was merely the father-in-law of one of the accused, the court said the CBI itself had not alleged that he played any role in the demand, acceptance or transportation of the alleged bribe amount.

It further observed that the investigating officer had failed to record any reasons for freezing the accounts.

While the CBI argued that Gulshan had helped conceal his absconding son-in-law, the court pointed to a discrepancy in the agency's case, noting that the accused had been arrested on 16 June, whereas the bank accounts were frozen only two days later.

"The investigating agency can proceed to freeze bank accounts of individuals, but it has to be done with the object of safeguarding and preventing the loss of proceeds of crime," Judge Changotra said.

The court found no evidence linking the applicant's accounts to the alleged crime, observing there was not "a whisper of allegation" that accused Prabhat Kumar Kapoor had transferred any money to his father-in-law after an alleged conspiracy meeting on 14 May.

Referring to its earlier order of 2 June rejecting the CBI's plea for further custodial interrogation of Haryana cadre IPS officer Deepak Gahlawat in the same bribery case, the court noted it had then also found no financial transactions in Gahlawat's account following the alleged conspiracy meeting.

The bribery case is linked to the CBI's investigation into an alleged fake drug manufacturing racket.

Emphasising the legal threshold for freezing bank accounts, the court said an investigating officer must have reasonable grounds to believe that an account was used, directly or indirectly, to receive or layer the proceeds of crime. In the present case, however, the court said the CBI had not even obtained the bank statements before deciding to freeze the accounts.

"The investigating agency is bound to act within the four corners of the law and investigation of alleged offences cannot be made a tool for harassing ordinary citizenry only because their relatives are suspected of having committed certain offences," the order said. "It is extremely important that such draconian and arbitrary practices are shunned to protect the valuable rights of law-abiding citizens."

Holding that the freezing of Gulshan Kumar's accounts was, prima facie, "completely arbitrary and devoid of any plausible explanation", the court ordered that all three bank accounts be unfrozen.

With PTI inputs