In an order dated 5 November 2026, the Rajasthan High Court directed State Bank of India to restrict the freeze of a customer's account to the disputed amount linked to an alleged illegal transfer. It said the remaining balance should remain available for transactions and gave a procedure for seeking the exact lien figure from investigating police.
The court’s direction
The Rajasthan High Court at Jodhpur disposed of Suresh Chand Sharma v. State Bank of India, S.B. Civil Writ Petition No. 26524/2026, on 5 November 2026. The petitioner had asked for his SBI bank account to be unfrozen. As an alternative, he sought a lien on only the disputed credit instead of restrictions on the entire account.
The court directed SBI to keep the amount alleged to have been illegally transferred under freeze, while permitting transactions from the remaining account balance. The order does not identify a final judicial finding of fraud against the account holder; its focus is the scope and implementation of the freeze.
What if the disputed amount is not known?
The order sets out a specific coordination process. If SBI has not been told the exact sum that police consider to be linked to the alleged offence, the bank must write to the investigating officer or police, asking them to specify the amount to be marked as a lien. The bank must also enclose a copy of the order.
The investigating agency must convey that figure to the bank within seven days of receiving the request. SBI must then comply with the court’s directions. The court added that the bank remains bound to act in accordance with the order even if the investigating agency does not reply. This does not authorise the bank to guess an amount or ignore other lawful restrictions that might independently apply.
Why this matters for branch and compliance teams
Account-freeze instructions often involve a branch, a central operations team and an investigating agency. This judgment illustrates the importance of accurately recording the amount in dispute, the source and date of the instruction, the available balance, communications with police and any subsequent court order. Staff handling the particular account should implement the actual order and seek legal/compliance guidance where instructions conflict or the exact amount remains unclear.
It would be incorrect to describe this case-specific judicial direction as a new RBI circular or a universal instruction automatically lifting every police-related account freeze. Different statutory powers, court orders and case facts can require different treatment.
What the judgment does not settle
The short order does not determine criminal liability or resolve any underlying cybercrime investigation. It also does not establish that a bank officer acted improperly. The judgment records the required action for this particular SBI account and a seven-day communication window for the police response.
Sources and References
Please consult the cited sources and check the exact applicability of any legal or employment change. Corrections are welcomed.
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