- 1 - HC-KAR NC: 2026:KHC:18587 WP No. 8425 of 2026 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 6TH DAY OF APRIL, 2026 BEFORE THE HON'BLE MR. JUSTICE SACHIN SHANKAR MAGADUM WRIT PETITION NO.8425 OF 2026 (GM-RES) BETWEEN: M/S. KIRAN ENTERPRISES HAVING OFFICE AT NO.391 GROUND FLOOR MADESHWARA NAGAR MAIN ROAD MADESHWARA NAGAR BADAVANE NEAR OXBRIDGE BUSINESS SCHOOL BENGALURU - 560091 REPRESENTED BY ITS PROPRIETOR SRI.SANTHOSH V S/O VIJAY KUMAR AGED ABOUT 35 YEARS (MSME UDYAM REGISTRATION: UDYAM-KR-03-0309874) R/AT NO.391, GROUND FLOOR MADESHWARA NAGAR MAIN ROAD BENGALURU - 560091 …PETITIONER (BY SRI. SADANAND G SHASTRI, ADVOCATE) AND: 1. THE STATE OF KARNATAKA REPRESENTED BY ITS ADDL. CHIEF SECRETARY DEPARTMENT OF HOME AFFAIRS NO.222, 2ND FLOOR, VIDHANA SOUDHA DR.B.R.AMBEDKAR VEEDHI BENGALURU - 560 001 Digitally signed by NAGARAJA B M Location: HIGH COURT OF KARNATAKA - 2 - HC-KAR NC: 2026:KHC:18587 WP No. 8425 of 2026 2. DIRECTOR GENERAL AND INSPECTOR GENERAL OF POLICE KARNATAKA STATE NRUPATHUNGA ROAD BENGALURU 560001 3. THE STATION HOUSE OFFICER SANKRAIL POLICE STATION HOWRAH POLICE COMMISSIONERATE WEST BENGAL - 711302 4. AXIS BANK REPRESENTED BY ITS BRANCH MANAGER RAJARAJESHWARI NAGAR BRANCH NO.483, SEETHA COMPLEX IDEAL HOMES CO-OPERATIVE BUILDING SOCIETY LIMITED BENGALURU - 560098 …RESPONDENTS (BY SRI.K.P.YOGANNA, AGA FOR R.1 TO R.3; SRI.JAI M. PATIL, ADVOCATE FOR R.4) THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO DIRECTION TO THE RESPONDENT NO.4 TO CONSIDER THE REPRESENTATION OF THE PETITIONER AT ANNEXURE -A AND FURTHER DIRECT THE RESPONDENT NO.4 BANK TO DEFREEZE/UNFREEZE THE CURRENT ACCOUNT NO.923020058914111 OF THE PETITIONER WITH AXIS BANK, RAJARAJESHWARI NAGAR BRANCH, BENGALURU (IFSC CODE.UTIB0001770) CONSEQUENTLY AND ETC. - 3 - HC-KAR NC: 2026:KHC:18587 WP No. 8425 of 2026 THIS PETITION, COMING ON FOR PRELIMINARY HEARING, THIS DAY, ORDER WAS MADE THEREIN AS UNDER: CORAM: HON'BLE MR. JUSTICE SACHIN SHANKAR MAGADUM ORAL ORDER The captioned writ petition is filed by the petitioner seeking a writ in the nature of mandamus to direct respondent No.4 - Bank to consider petitioner's representation dated 26.02.2026 and defreeze the current account bearing number No.923020058914111. 2. The petitioner in the captioned writ petition is primarily aggrieved by the action of respondent No.4–Bank in freezing the petitioner’s bank account pursuant to a communication issued by respondent No.3–Investigating Officer. The grievance of the petitioner is that such freezing of the entire account is arbitrary, disproportionate, and beyond the scope of the request made by the Investigating Officer. 3. Learned counsel appearing for the petitioner would submit that the communication issued by respondent - 4 - HC-KAR NC: 2026:KHC:18587 WP No. 8425 of 2026 No.3–Investigating Officer only sought for marking of lien to the extent of ₹1,300/- in the petitioner’s account. However, contrary to the limited request made by the Investigating Officer, respondent No.4–Bank has proceeded to debit freeze the entire account, thereby completely disabling the petitioner from operating the same. He would further contend that the petitioner is a duly registered MSME enterprise and the subject account is a current account maintained exclusively for bona fide business transactions, including receipt of sale proceeds, payments to suppliers and employees, and discharge of statutory obligations such as GST, taxes, rent, and utility charges. The impugned action, therefore, has the effect of paralysing the petitioner’s business operations. 4. This Court has heard the learned counsel appearing for the parties and has carefully perused the material on record, more particularly Annexure-C. A perusal of the said communication issued by respondent No.3–Investigating Officer clearly indicates that the - 5 - HC-KAR NC: 2026:KHC:18587 WP No. 8425 of 2026 petitioner is alleged to have received suspected proceeds of crime to the extent of ₹1,300/-. The Investigating Officer, therefore, requested respondent No.4–Bank to mark lien in respect of the said amount. However, the records reveal that respondent No.4–Bank, instead of restricting the action to lien marking for the specified amount, has proceeded to freeze the entire account of the petitioner. 5. It is not in dispute that the petitioner is an MSME enterprise engaged in business activities and the account in question is a running current account essential for its day-to-day operations. While it is well within the powers of the Investigating Agency to secure suspected proceeds of crime and to ensure that such funds are not dissipated during the course of investigation, such power is required to be exercised in a reasonable and proportionate manner. The action taken should not result in an excessive or blanket restriction that would cripple legitimate business - 6 - HC-KAR NC: 2026:KHC:18587 WP No. 8425 of 2026 activities, particularly when the amount sought to be secured is specifically quantified. 6. In the present case, the request made by the Investigating Officer was limited to marking lien for a sum of ₹1,300/-. Therefore, the action of respondent No.4 - Bank in freezing the entire account is clearly disproportionate and not in consonance with the communication issued by the Investigating Officer. This Court is of the considered view that the ends of justice would be met if the lien is restricted strictly to the amount indicated, while permitting the petitioner to operate the account in respect of the remaining balance. 7. Accordingly, this Court deems it appropriate to issue necessary directions to respondent No.4–Bank to confine the lien to the extent of ₹1,300/- and to allow the petitioner to freely operate the account beyond the said amount, subject to the petitioner extending full cooperation to the ongoing investigation. - 7 - HC-KAR NC: 2026:KHC:18587 WP No. 8425 of 2026 8. For the foregoing reasons, this Court proceeds to pass the following; ORDER (i) The writ petition is hereby allowed. (ii) The action initiated pursuant to the communication issued by respondent No.3 – Investigating Officer directing respondent No.4 – Bank to mark lien on the petitioner’s account bearing No.923020058914111 is upheld only to the limited extent of ₹1,300/- and the said lien shall continue to remain in force. (iii) Respondent No.4 – Bank is hereby directed to defreeze the petitioner’s account forthwith, except to the extent of ₹1,300/- which shall remain under lien. (iv) The petitioner shall be permitted to operate the bank account freely in respect of any amount exceeding ₹1,300/- without any restriction, pending completion of the investigation. - 8 - HC-KAR NC: 2026:KHC:18587 WP No. 8425 of 2026 (v) The petitioner shall extend full cooperation to respondent No.3–Investigating Officer and shall appear as and when required, and furnish such information or documents as may be called for in the course of investigation. Sd/- (SACHIN SHANKAR MAGADUM) JUDGE NBM List No.: 1 Sl No.: 9