Madras High Court pulls up Chennai cybercrime police for freezing bank account of publicly listed company

The Madras High Court criticised the Chennai cybercrime police for freezing the overdraft current account of publicly listed company V-Mart Retail, which had a sanctioned limit of ₹75 crore.

The court noted that the police froze the account merely because ₹4,194 of crime-linked money had been deposited by a customer purchasing goods – an action the judge found highly disproportionate.

Justice M. Nirmal Kumar emphasised that while preventing criminals from diverting fraudulent funds is important, such measures should not disrupt the entire business operations of genuine and unrelated companies.

The judge agreed with advocate Chevanan Mohanan, appearing for HDFC Bank, who argued that the bank simply followed police instructions and could not be held responsible for the freezing of V-Mart’s overdraft account.

He pointed out that widespread freezing of bank accounts based on complaints filed on the National Cybercrime Reporting Portal (NCRP) has remained a long-standing concern for businesses and individuals.

The High Court also recalled that the Greater Chennai Police Commissioner had, in 2021, issued a circular guiding officers on how to handle NCRP-based account-freezing requests more responsibly.

Reported on: November 6, 2025, Thursday