1 2025:CGHC:55342 NAFR HIGH COURT OF CHHATTISGARH, BILASPUR CRMP No. 1982 of 2024 Vinayak Jayant Kulkarni (Wrongly Mentioned As Vinayak Kulkarni) S/o Jayant Kulkarni Aged About 65 Years (Aadhar No. 8625 4428 9937), Director Of K And M Gold Medallion Company, R/o A/8, Asian Building, Manmala Tank Road, Near Starcity Cinema, Matunga West, Mumbai (Maharashtra) Pin-400016 (Correct Age And Address Mentioned) ... Petitioner versus 1 - State Of Chhattisgarh Through The State Cyber Police Station, Nava Raipur (Wrongly Mentioned As Nava), District - Raipur (C.G.) 2 - Dr. Sanjiv Purkayastha S/o Late Rishikesh Purkayastha Aged About 56 Years R/o Quarter No. 9a, Jindalgarh, Jindal Steel And Power Limited, Raigarh, District Raigarh (C.G.) (Complainant) ---- Respondents ___________________________________________________________ For Petitioner : Mr. Hari Agrawal, Advocate For State/Respondent No.1 : Mr. Ajit Singh, Govt. Advocate For Respondent No.2 : Mr. Dharmesh Shrivastava, Advocate ___________________________________________________________ Hon'ble Shri Justice Arvind Kumar Verma Judgment On Board 2 13/11/2025 1. With the consent of counsel for the parties, the matter is heard finally. 2. The Petitioner has filed the instant petition under Section 528 of the BNSS, 2023 by challenging the impugned order dated 05.07.2024 (Annexure P-1) passed in Criminal Revision No.170/2024 passed by the 14th Additional Sessions Judge, Raipur, District Raipur (C.G.), whereby the revisional Court was rejected the application for de-freezing the bank account of the petitioner bearing number 2011320467 K&M Gold Medallion Pvt. Ltd. 3. Briefly stated facts of the case leading to the disposal of this petition are that the complainant was defrauded in an online trading scam in 2021, where fraudsters asked him to deposit “holding charges” into certain bank accounts. During investigation, police found that part of the fraudulent money had passed through several intermediary accounts and ultimately reached B.D. Bangles & Jewellers, which had purchased bullion from the petitioner’s firm, K&M Gold Medallion Pvt. Ltd. Although the police found the petitioner to be a genuine businessman and made him a prosecution witness, his Kotak Mahindra Bank account containing Rs. 47 lakhs was frozen on 3 04.02.2022. 4. Despite no material showing his involvement, the trial Court rejected his de-freezing application, and the Revisional Court dismissed his revision on technical grounds. Meanwhile, orders granting interim custody of amounts from all frozen accounts, including the petitioner’s, were passed without giving him notice or hearing. The petitioner has now approached this Court seeking de-freezing of his account and correction of the miscarriage of justice. 5. Learned counsel for the petitioner would submit that the Petitioner is the lawful and bona fide owner of the amount lying in the frozen bank account, the same being genuine proceeds arising out of legitimate bullion transactions, duly supported by invoices, bank entries, and statutory compliance. It is argued that investigation material itself demonstrates that the amount was first deposited by the Petitioner in the account of Kreativecrew and thereafter transferred to Awlencan Enterprises, reflecting a clear chain of lawful commercial dealings. It is further submitted that the learned Revisional Court passed the impugned order without considering the pendency of another connected revision, owing to concealment of material facts by the Respondents. This has resulted in serious procedural irregularity and miscarriage of 4 justice, vitiating the entire proceedings. Counsel submits that the settled principle of law mandates that interim custody of seized property must go to the person who prima facie appears to be the rightful owner, and the same principle equally applies in matters of freezing and de-freezing of bank accounts. The Court’s machinery cannot be permitted to operate as an instrument of oppression, particularly when the transactions in question are fully explained and are in no manner connected with any alleged offence. It is therefore submitted that the impugned order dated 05.07.2024 deserves to be set aside, and the Petitioner’s application for de-freezing of the bank account is liable to be allowed in the interest of justice. 6. On the other hand, learned counsel for the State opposes the petition and submits that the investigation has revealed serious discrepancies in the financial trail shown by the Petitioner. It is argued that the flow of funds from the Petitioner’s account to entities such as Kreativecrew and Awlencan Enterprises appears suspicious, lacking satisfactory explanation and indicating possible layering of funds. Therefore, the amount in the frozen bank account cannot be treated as bona fide business proceeds at this stage. It is further contended that the freezing of the bank account was carried out strictly in accordance with law to preserve the evidence and prevent dissipation of funds which are under 5 investigation. Premature de-freezing would seriously hamper the ongoing inquiry, which is at a crucial stage. The State also submits that the Petitioner’s allegation of concealment or mala fides is unfounded and baseless, as the Revisional Court passed orders on the basis of the record available and in accordance with judicial proceedings. It is argued that the Petitioner is attempting to misrepresent the process to obtain an order of de-freezing without cooperating fully in the investigation. Therefore, in view of the seriousness of the allegations, ongoing investigation, and the doubtful nature of the financial transactions, the State submits that the petition is misconceived and no ground is made out for interference with the impugned order. 7. Learned counsel for respondent No.2 also opposes the petition and submits that the Petitioner has failed to establish any clear ownership of the seized amount. It is contended that the alleged business transactions are not supported by credible documents, and multiple inconsistencies have been identified in the invoices and banking pattern relied upon by the Petitioner. It is further submitted that the learned Revisional Court had no obligation to consider any parallel proceedings unless specifically brought to its notice, and the Petitioner cannot take advantage of his own omissions or misrepresentations. The allegation that Respondent No. 2 acted mala fidely or concealed facts is strongly denied. 6 Respondent No. 2 argues that the principles regarding interim custody of seized goods cannot be stretched to grant de-freezing of accounts when the origin of the funds is itself under serious suspicion. It is submitted that premature release of such funds would defeat the very purpose of seizure and may result in irretrievable loss to the investigation. Accordingly, Respondent No. 2 submits that the petition is devoid of merit and the impugned order has been rightly passed, warranting no interference by this Court. 8. I have heard learned counsel for the parties and perused the record with utmost circumspection. 9. Having considered the rival submissions and perused the material placed on record, looking to the entire facts of the case particularly that the petitioner has not an accused in the present case and concerned police station has made a witness to the petitioner, therefore, as per the established story of the prosecution, the petitioner is not involvement in the crime in question, this Court is of the considered view that the Petitioner has successfully demonstrated a prima facie lawful and bona fide claim over the amount lying in the frozen bank account. The investigation papers produced before this Court reveal a continuous and explained trail of transactions arising out of 7 genuine commercial dealings in bullion, supported by invoices, bank entries and other statutory documentation. No material of substantive probative value has been placed by the Respondents to indicate that the said amount constitutes proceeds of crime or that the Petitioner’s claim is fabricated or doubtful. 10. This Court also finds merit in the submission that the pendency of another connected revision was not placed before the Revisional Court, which has resulted in procedural irregularity and caused prejudice to the Petitioner. The concealment of such material proceedings has vitiated the decision-making process and has materially affected the impugned order. 11. In Final Report (Annexure P-4), it is specifically mentioned that : "्ቚकरण ेሰ ेሰम्बई ቝኌ त KM GOLD एवं B BANGLES क सा AD SILVER क साचालक ቛኋर खरदी-बिबቅኍ साबधी दी तवंज एवं साचालन साबधिधीत दी तवंज ्ቚ तत बिकया गया। उ्ሹ साचालक क ቛኋर वं(धी करबर साबधिधीत दी तवंज पेश बिकया है(. अत- ्ቚकरण ेሰ उ्ሹ क पेबिनया. क/ सालिल्቎त ्ቚदीቦኌशत नहै3 है रहै है(।" 12. It is a settled principle that interim custody or control over seized property is to be entrusted to the person who prima facie appears to be the rightful and lawful owner. The same principle applies with equal force to cases of freezing and de- freezing of bank accounts. In the absence of any conclusive 8 material suggesting criminality, there remains no justification to continue the freezing of the Petitioner’s bank account. Continued freezing, in the facts of the present case, would amount to oppression and unnecessary interference with legitimate business rights. Accordingly, this Court is satisfied that the impugned order dated 05.07.2024 is unsustainable in law, having been passed without proper appreciation of the material on record and in disregard of pertinent facts. 13. Having considered the submissions and perused the material placed on record, this Court is of the view that the petitioner has satisfactorily established his undisputed ownership over the amount of ₹47,00,000/-, lying in the bank account, for which interim custody/de-freezing was sought. The Courts below failed to appreciate this foundational fact and, therefore, the impugned orders cannot be sustained. 14. Accordingly, the instant petition is allowed and the impugned order dated 05.07.2024 (Annexure P-1) is hereby set aside. The concerned Bank is directed to forthwith de-freeze the bank account of the Petitioner bearing number 2011320467 K&M Gold Medallion Pvt. Ltd.. However, as a measure of safeguard, it is directed that the petitioner shall furnish a surety to the satisfaction of the trial Court for the aforesaid amount of ₹47,00,000/-. Upon 9 furnishing of such surety, the concerned bank shall forthwith permit operation of the said account and release the amount in favour of the petitioner and the same shall remain subject to final outcome of matter and the Petitioner shall extend full cooperation with the ongoing investigation, if any, and subject to any further orders that may be passed by the competent Court. Sd/- (Arvind Kumar Verma) Judge Vasant