Axis Bank Limited Vs the State of Karnataka — Company and Corporate | Karnataka HC (2025)

Axis Bank Limited Vs the State of Karnataka — Company and Corporate | Karnataka HC (2025)

What the court decided

AI extract

Outcome

Impugned order dated 24.09.2024 (Chief Judicial Magistrate, Bengaluru Rural District, in Crime No.212/2024) set aside; matter remanded to the Chief Judicial Magistrate for fresh consideration of the application under Sections 451 and 457 Cr.P.C. after hearing the petitioner-bank; until disposal of the application, the petitioner-bank restrained from releasing money from the subject account; petition disposed of accordingly.

Issue for consideration

Whether the order dated 24.09.2024 passed by the Chief Judicial Magistrate, Bengaluru Rural District, Bengaluru, in Crime No.212/2024 (Annexure-C), directing the petitioner-bank to defreeze the savings account bearing No.92301006961631 and transfer the amount to the account of respondent No.2, ought to be set aside.

Court's answer

The issue in controversy in the present petition is covered by the judgment of this Court in Axis Bank Ltd. (Crl.P.No.1787/2023 dated 14.12.2023), and the petition is disposed of in terms of that order.

Ratio / Principle

The petition is allowed and the order dated 24.09.2024 passed by the Chief Judicial Magistrate, Bengaluru Rural District, Bengaluru, in Crime No.212/2024 is set aside.

Key takeaways

The matter is remanded to the Chief Judicial Magistrate, Bengaluru Rural District, Bengaluru, to reconsider the application filed under Sections 451 and 457 of Cr.P.C. afresh, after giving the opportunity of hearing to the petitioner-bank.ratio¶66
Till the application is disposed of, the petitioner-bank is restrained from releasing the money in favour of any person from the subject account.ratio¶67

Detailed headnote1 paragraphs

Criminal Petition (CRL.P No.4081 of 2025) filed under S.482 Cr.P.C. (also under S.528 BNSS) by Axis Bank Limited before the High Court of Karnataka (S.R. Krishna Kumar J., 06.06.2025), challenging the order dated 24.09.2024 passed by the Chief Judicial Magistrate, Bengaluru Rural District, in Crime No.212/2024 (Electronic City Police Station), whereby the petitioner-bank was directed to defreeze the savings account bearing No.92301006961631 maintained with it and transfer the amount to the account of respondent No.2 (the complainant). Holding: the issue in controversy is covered by the Co-ordinate Bench judgment in Axis Bank Ltd. v. State of Karnataka, Crl.P.No.1787/2023 dated 14.12.2023 (which held that a Magistrate must hear the petitioner-bank before directing unfreezing and transfer of amounts, since multiple release orders across courts can exceed the balance available in the subject accounts). Accordingly the petition was allowed; the impugned order dated 24.09.2024 was set aside; the matter was remanded to the Chief Judicial Magistrate, Bengaluru Rural District, to reconsider the application under Sections 451 and 457 Cr.P.C. afresh after affording the petitioner-bank an opportunity of hearing; and until disposal of the application, the petitioner-bank was restrained from releasing money in favour of any person from the subject account.

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IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 6^TH DAY OF JUNE, 2025

BEFORE

THE HON'BLE MR JUSTICE S.R.KRISHNA KUMAR CRIMINAL PETITION NO.4081 OF 2025 (482(Cr.PC) / 528(BNSS)

BETWEEN:

AXIS BANK LIMITED A BANKING COMPANY, CARRYING ON THE BANKING BUSINESS, UNDER THE BANKING REGULATION ACT, 1949, INCORPORATED UNDER THE COMPANIES ACT, 1956 AND HAVING ITS REGISTERED OFFICE AT ‘TRISHUL’, 3^RD FLOOR, OPP. SAMARTHESHWAR TEMPLE, LAW GARDEN, ELLIS BRIDGE, AHMEDABAD – 380 006. GUJARAT

Digitally signed by CHANDANA B M Location: High Court of Karnataka

AND HAVING ONE OF ITS BRANCH OFFICES AT GROUND FLOOR AND PART FIRST FLOOR, CLASSIC COMPLEX, PLOT NO.9, SERVICE CENTRE, SECTOR-5, ROHINI, DELHI – 110 084. REPRESENTED BY ITS BRANCH HEAD, MRS. AANCHAL ARORA, AGED ABOUT 42 YEARS,

ALSO AT: KOHAT METRO STATION, 232, FIRST FLOOR, KOHAT ENCLAVE, VTC: PITAM PURA, NORTH WEST DELHI, DELHI – 110 034.

…PETITIONER

(BY SRI. UNNIKRISHNAN M., ADVOCATE)

AND:

THE STATE OF KARNATAKA BY ELECTRONIC CITY POLICE STATION, ELECTRONIC CITY SUB - DIVISION,

BANGALORE DISTRICT. REPRESENTED BY SPP, HON'BLE HIGH COURT OF KARNATAKA,

BANGALORE – 01.

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SMT. A. MEENAKSHEE, W/O. ARUN BALAKRISHNA, AGED ABOUT 63 YEARS, RESIDING AT N-3 BLOCK, N-112. GODREJ E-CITY APT. DODDATHOGURU, BENGALURU CITY – 560 100.

…RESPONDENTS

(BY SRI. CHANNAPPA ERAPPA, HCGP FOR R1; R2 IS SERVED BUT UNREPRESENTED)

THIS CRIMINAL PETITION IS FILED U/S 482 CR.PC (FILED U/S 528 BNSS) PRAYING TO SET ASIDE THE ORDER, DATED 24.09.2024 PASSED BY THE HON'BLE CHIEF JUDICIAL MAGISTRATE, BENGALURU RURAL DISTRICT, BENGALURU IN CRIME NO.212/2024 I.E., ANNEXURE-C IN TERMS OF WHICH, THE PETITIONER IS DIRECTED TO DEFREEZE THE SAVING ACCOUNT BEARING NO.92301006961631 MAINTAINED IN THE PETITIONER'S BANK AND TRANSFER THE SAME TO THE ACCOUNT OF THE RESPONDENT NO.2.

THIS PETITION, COMING ON FOR ADMISSION , THIS DAY, ORDER WAS MADE THEREIN AS UNDER:

CORAM: HON'BLE MR JUSTICE S.R.KRISHNA KUMAR

ORAL ORDER

In this petition, the petitioner seeks the following reliefs:

“a) To set-aside the order dated 24.09.2024 passed by the Hon’ble Chief Judicial Magistrate, Bengaluru Rural District, Bengaluru, in Crime No.212/2024 i.e., Annexure-‘C’ in terms of which, the petitioner is directed to defreeze the Savings / Current account bearing A/c. No.92301006961631 maintained in the petitioner’s Bank and transfer the same to the account of the Respondent No.2.

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b) To pass such other orders as may be deemed expedient in the circumstances of the case and in the interest of justice.”

Heard learned counsel for the petitioner and learned

HCGP for respondent No.1 and perused the material on record.

In addition to reiterating the various contentions urged

in the memorandum of petition and referring to the material on record, learned counsel for the petitioner submits that the issue in controversy involved in the present petition is directly and squarely covered by the judgment of the Co-ordinate Bench of this Court in

the case of Axis Bank Ltd., Vs. The State of Karnataka and Anr. – Crl.P.No.1787/2023 dated 14.12.2023, and the present petition may be disposed of in the above terms.

As rightly contended by the learned counsel for the petitioner, the issue in controversy in the present petition is covered by the judgment of this Court in the case of Axis Bank Ltd. Supra, wherein it is held as under:

“The Petitioner which is a Financial Institution is before this Court challenging the order passed by 1^st Additional Chief Metropolitan Magistrate on an application filed under Sections 451 and 457 of

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Cr.P.C. by the complainant/respondent No.2 directing the petitioner-Bank to defreeze the amount belonging to the accused and transfer the said amount to the bank account of the complainants/respondent No.2.

2. The petitioner’s concern is that the order passed by the Jurisdictional Magistrate cannot be executed because it surpasses the specified release amount, and numerous courts across the Country have issued directives to the investigating agencies to unfreeze the bank accounts of the accused therein.

3. Learned Special Public Prosecutor on instructions would suggest that the matter may be remanded to the Jurisdictional Courts to consider the application filed under Sections 451 and 457 of Cr.P.C. afresh, by affording an opportunity of hearing to the petitioner.

4. Admittedly, multiple cases are registered against the accused herein within the State and across the country and there are multiple orders passed by the Jurisdictional Magistrates directing the petitioner to unfreeze the account of the accused and transfer the amount to the bank account of the complainants. The passing of multiple orders has caused difficulty to the petitioner/bank in executing the said order, since the amount ordered to be released in some accounts

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exceeds the amount available in the subject accounts of the accused. Therefore, the learned Magistrate before passing an order directing the petitioner to unfreeze and transfer the amount to the accounts of the complainants, is required to hear the petitioner. Accordingly, I pass the following:

ORDER

i. Criminal Petition is allowed .

ii. The order dated 26.11.2021 passed by the 1^st Additional Chief Metropolitan Magistrate, Bengaluru in Cr.No.452/2021 is hereby set aside.

iii. Matter is remanded to 1^st Additional Chief Metropolitan Magistrate, Bengaluru to reconsider the application filed under Sections 451 and 457 of Cr.P.C. afresh, after giving the opportunity of hearing to the petitioner.

5. Till the application is disposed of, the petitioner/bank is restrained from releasing the money in favour of any person from the subject account.”

In view of the above, the petition is disposed of in

terms of the order passed in the case of Axis Bank Ltd. supra.

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6. Accordingly, I pass the following:

ORDER

i. The petition is hereby allowed .

ii. The order dated 24.09.2024 passed by the Chief Judicial Magistrate, Bengaluru Rural District, Bengaluru, in Crime No.212/2024 is hereby set aside.

iii. Matter is remanded to Chief Judicial Magistrate, Bengaluru Rural District, Bengaluru, to reconsider the application filed under Sections 451 and 457 of Cr.P.C. afresh, after giving the opportunity of hearing to the petitioner.

iv. Till the application is disposed of, the petitioner / bank is restrained from releasing the money in favour of any person from the subject account.

Subject to the aforesaid observations and directions, the

petition stands disposed of.

Sd/-

(S.R.KRISHNA KUMAR) JUDGE

SV

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