MP High Court Orders SBI to Unfreeze Armed Forces Personnel's Salary Account Frozen on Cyber Cell Directions Without Notice
The Gwalior Bench held that a blanket freeze on a serving Special Armed Force personnel's salary account, without any material showing criminal involvement, violated Article 21 of the Constitution.
The High Court of Madhya Pradesh at Gwalior has directed the State Bank of India to forthwith defreeze and restore operation of a salary account belonging to Anuj Kumar Sharma, a serving personnel of the Special Armed Force, 13th Battalion, posted at Raj Bhavan, Bhopal. The account, maintained at SBI's Main Branch, Jiwaji Chowk, Gwalior, had been frozen on the basis of directions received from a Cyber Cell, without any notice to the account holder and without any criminal case or departmental proceedings pending against him. Justice Milind Ramesh Phadke, sitting singly, found that the complete restraint on the salary account, the petitioner's sole source of livelihood, in the absence of any material linking the entire account to criminal activity, caused serious prejudice to the fundamental right guaranteed under Article 21 of the Constitution.
The Dispute Before the Court
Anuj Kumar Sharma filed Writ Petition No. 9453 of 2021 under Article 226 of the Constitution seeking removal of the freeze on his salary account bearing No. 3009138445 2 with SBI, Jiwaji Chowk, Gwalior, where his monthly salary as a Special Armed Force personnel is regularly credited.
His counsel, Shri Swapnil Sharma, submitted that the respondents, without issuing any notice or assigning any valid reason, illegally restrained operation of the account, allegedly on the basis of some communication received from the Cyber Cell. At the time of freezing, no criminal case and no departmental proceedings were pending against the petitioner. Despite repeated approaches to the bank seeking release of the account, neither a written order nor any satisfactory explanation was provided to him.
The petitioner contended that the freeze deprived him and his family of access to his salary, which was the sole source of livelihood and the means for his children's education. He argued that the action was arbitrary, illegal, and violative of Articles 14, 19, and 21 of the Constitution, as he had been deprived of his right to livelihood and a dignified life without following due process of law.
The Bank's Position and the Silence of Respondent No. 2
Counsel for the respondent bank, Shri Raju Sharma, submitted that the account was restricted pursuant to directions received from the concerned Cyber Cell or competent authority regarding suspicious transactions under enquiry. The bank maintained that it acted strictly in compliance with statutory and regulatory obligations and had no arbitrary or mala fide intention against the petitioner. The restriction, it was argued, was a precautionary measure taken in accordance with law.
Respondent No. 2, despite having filed a Vakalatnama, neither appeared before the court nor filed any reply controverting the averments in the petition. No explanation or response was furnished regarding the impugned action. The court noted this absence expressly.
How the Bench Reasoned
Justice Phadke accepted that the bank is bound to comply with lawful directions issued by an investigating agency. That obligation, however, does not justify a complete and indefinite freeze on a salary account, particularly of a serving armed force personnel, when no material has been placed on record showing that the entire account and all its transactions are involved in any criminal activity.
The court found it undisputed that the petitioner had been deprived of operating the account for a considerable period of time. The Cyber Cell or competent authority, respondent No. 2, offered no justification before the court for continuing the complete freeze. In those circumstances, the court held that the petitioner cannot be deprived of access to his legitimate salary merely because certain transactions are under enquiry.
The reasoning draws a clear line between two distinct interests: the investigating agency's legitimate interest in preserving amounts linked to suspicious transactions, and the account holder's constitutional right to access salary credited for lawful service. A blanket freeze collapses that distinction and, in the court's view, crosses into a violation of Article 21.
Directions Issued
The court directed SBI to forthwith defreeze and restore operation of account No. 3009138445 2, except for the amount relating to the suspicious or disputed transactions, if any, identified by the concerned investigating agency. The bank is required to permit the petitioner to withdraw and utilise the remaining available amount, including future salary credits, for his livelihood and family expenses.
The amount pertaining to the disputed or suspicious transactions alone shall remain subject to restraint until the conclusion of the enquiry or investigation, or until appropriate orders are passed by the competent authority in accordance with law.
No order as to costs was made.
Order
Writ Petition No. 9453 of 2021 was disposed of on 13 May 2026 by Justice Milind Ramesh Phadke of the High Court of Madhya Pradesh at Gwalior. SBI, Main Branch, Jiwaji Chowk, Gwalior, was directed to forthwith restore operation of the petitioner's salary account No. 3009138445 2, permitting withdrawal of all amounts except those specifically identified by the investigating agency as pertaining to suspicious or disputed transactions, which shall remain frozen pending conclusion of the enquiry or further orders of the competent authority.