The Madras High Court on Friday called for an explanation from an Inspector of Police for having frozen Shriram Life Insurance Company’s bank account with a balance of ₹6.5 crore just because an individual had lodged a complaint accusing the company of having cheated him to the tune of ₹30,000. The court also directed the High Court Registry to take the issue to the notice of the Greater Chennai Commissioner of Police.
Justice M. Nirmal Kumar wanted the Registry to forward a copy of his interim order to the Commissioner of Police “for information and to give necessary instructions and directions to his personnel conducting investigation in such cases and see to it that there is no colourable exercise of power”. The judge also ordered immediate defreezing of the company’s bank account with a rider to maintain a minimum balance of ₹1 lakh.
According to the complainant, an agent of the insurance company had promised to get him a loan if he paid ₹30,000 towards an insurance policy. He alleged that the loan was not sanctioned despite taking the insurance policy and that the company demanded more money. He also lodged a complaint in this regard with the Central Crime Branch and the matter was taken up for investigation by the bank fraud investigation wing.
Advocate Chevanan Mohan, representing HDFC Bank, said the bank received a request from an Inspector of Police on May 25 to freeze the bank account and hence it was frozen on May 27. Aggrieved over such action, the insurance company had approached the court now seeking a direction to defreeze the account. On coming to know about the facts of the case, the judge expressed shock over the action initiated by the police.
The act of the Inspector “seems to be high-handed and without authority of law,” the judge wrote in his interim order and stated that the entire business of the insurance company had been crippled. “The above act is condemnable and not to be repeated in future,” he said and directed the Inspector to explain by June 25 the circumstances under which he had written a letter to the bank to freeze the account of the insurance company.
