Bank Accounts Cannot be Seized U/S 102 CrPC without Link to Offence

Source: Bombay High Court 

Why in News? 

Justice N.J. Jamadar of the Bombay High Court, in Geeta Kampani v. State of Maharashtra with Parag Shah v. Geeta Kampani (2026), heard two criminal applications arising from an order of the Additional Chief Metropolitan Magistrate directing the de-freezing of bank accounts and mutual fund units of the accused, subject to furnishing a bank guarantee of Rs. 6.55 crores. 

• One application was filed by the first informant challenging the very de-freezing of the accounts. The other was filed by accused no. 2 challenging the condition requiring the furnishing of the bank guarantee. The Court dismissed the first informant's application and partly allowed the application of accused no. 2 by modifying the condition imposed for de-freezing from a bank guarantee to an indemnity bond.

What was the Background of Geeta Kampani v. State of Maharashtra (2026) Case? 

• The accused contended that there was no nexus whatsoever between the frozen accounts and the alleged offences.  
• It was argued that Section 102 CrPC empowers seizure only of property having a direct connection with the offence under investigation, and not any property belonging to an accused merely by virtue of such association. 
• The Additional Chief Metropolitan Magistrate had directed the de-freezing of the bank accounts and mutual fund units subject to the condition of furnishing a bank guarantee equivalent to the frozen amount of Rs. 6.55 crores.  
• Both the first informant and accused no. 2 challenged this order before the Bombay High Court on different grounds.

What were the Court's Observations? 

• On the Scope of Section 102 CrPC: The Court held that though bank accounts constitute "property" within the meaning of Section 102 CrPC, the power to seize can be exercised only where there exists a direct link between the property and the commission of the alleged offence. The Court emphasised that the provision uses the expression "any property," but the power to seize is conditioned by the requirement that such property be alleged or suspected to be stolen, or be found in circumstances creating suspicion of the commission of an offence. 
• On the Character of the Property: The Court observed that the emphasis under Section 102 is on the character of the property rather than its association with the persons involved in the offence. Only property alleged or suspected to be stolen, or found in circumstances creating suspicion of an offence, can lawfully be seized under this provision. 
• On the Purpose of Section 102 CrPC: The Court held that Section 102 is intended to assist in investigation and the collection of evidence. It is not a mechanism to secure recovery for the complainant or to hand over property to a person whom the investigating agency believes to be the rightful owner. 
• On the Bank Guarantee Condition: The Court held that requiring the accused to furnish a bank guarantee of Rs. 6.55 crores — equivalent to the frozen amount — as a condition for de-freezing virtually amounted to a refusal of the very prayer for de-freezing. Such an onerous condition frustrated the purpose of de-freezing the accounts. The Court held that only reasonable conditions could be imposed in such circumstances. 
• On the Facts of the Case: The Court noted that the material on record did not prima facie establish the necessary nexus between the frozen bank accounts and mutual funds and the commission of the alleged offences. It accordingly modified the Magistrate's order, directing de-freezing subject to the furnishing of an indemnity bond instead of a bank guarantee.

What is Section 106 of BNSS? 

Section 106 BNSS – Power of Police Officer to Seize Certain Property:  

• This Section Corresponds to Section 102 CrPC.   
• Any police officer may seize property alleged or suspected to have been stolen, or found in circumstances creating suspicion of commission of an offence.  
• If the seizing officer is subordinate to the Station House Officer, he must forthwith report the seizure to that officer.  
• The seizing officer must also report the seizure to the jurisdictional Magistrate without delay.  
• Where the seized property cannot be conveniently transported to court, or custody is difficult, or continued police custody is unnecessary, the officer may hand it over to any person on a bond undertaking to produce it before the court as required.  
• Where seized property is subject to speedy decay, the owner is unknown or absent, and its value is below ₹500, it may be auctioned under orders of the Superintendent of Police; Sections 503 and 504 BNSS apply to the net proceeds.

Legal History of the Provision: Power of Police Officer to Seize Certain Property