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Central Bank of India v. Husainy Fakhruddin & Ors.

Criminal Appeal · Neutral citation not assigned (Criminal Appeal No. 968 of 2011)Decided 31 Jan 2017
Criminal Appeal No. 968 of 2011
Justice Kurian Joseph · Justice A.M. Khanwilkar

Background

The respondents had deposits with Central Bank of India. When they sought to withdraw their money, the Central Bureau of Investigation (CBI) asked the bank in writing not to release the deposits pending a reference from the CBI or a Special Court. The depositors challenged this hold before the High Court, which directed the bank to release the funds, prompting the bank's appeal to the Supreme Court.

Decision Breakdown

By the time the appeal was heard, counsel for the CBI informed the Court, on instructions, that the CBI had withdrawn its earlier request to the bank and had no objection to release of the funds. Since the bank's main reason for withholding the money had disappeared, the Supreme Court found it unnecessary to examine the other legal arguments raised, left all other questions of law open, and disposed of the appeal by directing the bank to release the deposits within a week, unless there was some other valid reason to withhold them.

Lesson Learnt

A bank that freezes a depositor's funds at a government agency's request must release them once that agency itself withdraws its objection, unless an independent legal ground for withholding still exists.

Official source (sci.gov.in)View Judgment (PDF)

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