MP High Court orders DCB Bank to unfreeze trader's account, keep Rs 4 lakh in FD

The Madhya Pradesh High Court at Indore on 12 October 2026 directed DCB Bank to unfreeze the current account of a trading firm and let it operate the account. Only the disputed amount of Rs 4,01,934.14 is to be kept in a fixed deposit, the court ordered.

What Happened

The firm, which holds its current account at a DCB Bank branch in Ujjain, filed a writ petition seeking a direction to unfreeze the account. Its counsel argued that the case was covered by two earlier decisions of the High Court.

The first, from 2024, directed banks to keep the amount flagged by cyber crime agencies in fixed deposits, to be released only after a Judicial Magistrate passes orders within three months. If no order came, the account holder could withdraw the money after informing the agencies. The second, dated 27 July 2026, from the bench at Jabalpur, relied on a Standard Operating Procedure (SOP) of 10 April 2026 issued by the Ministry of Home Affairs for accounts put on hold through the national cyber crime reporting system. It framed guidelines saying that police should ordinarily direct a lien or debit freeze only up to the suspected amount, and that freezing a whole account is for exceptional cases, with reasons recorded in writing.

The court held that both decisions apply. It ordered the Rs 4,01,934.14 kept in a fixed deposit, to be released only after a Magistrate's order within three months under the BNSS or other law, failing which the firm may withdraw it after informing the police. The account itself is to be unfrozen. The bank may still act under the SOP if another complaint about a different entry reaches it.

What It Means

For small businesses whose accounts are frozen over a cyber fraud complaint, the order shows the court limiting the hold to the disputed sum so that the rest of the account can be used. Under the guidelines the court applied, the bank must upload a customer's grievance on the portal within seven days, and the Investigating Officer must decide it within fifteen days. Unresolved grievances move to a District Grievance Redressal Officer. Cyber fraud can be reported at https://cybercrime.gov.in or on helpline 1930.

Source: High Court judgment