The Dilemma Over Interpretation of Section 102 of Code of

Criminal Procedure, 1973

Ravi Singh Chhikara and Kanishk Aroraβ

It has been often observed that the ambiguous text of provisions causes abuse and misuse
of investigation powers by police officers often leading to harsh ramifications for ostensible
innocent parties as well as accused persons. One of such provisions is Clause (1) of Section 102,
Code of Criminal Procedure, 1973 (hereinafter “CrPC”), wherein police officers are empowered
to freeze the bank accounts of a person. However, the issue that surrounds the interpretation of
Section 102(1) is the condition precedent for seizing the bank accounts of a person. The
conundrum is that whether this condition precedent before seizing the bank account is (a) that the
transactions of the bank account must create the suspicion of the commission of any offence by
the bank account holder, or (b) simply that the bank account holder must be an accused in the
commission of any offence and there should be a nexus between the bank account and the
alleged offence.

In other words, whether the discovery of an offence must follow the discovery of
suspicious bank transactions always, or the discovery of any offence can precede the discovery
of suspicious bank transactions?

Conflicting judgments

Clause (1) of Section 102 states that “Any police officer may seize any property which
may be alleged or suspected to have been stolen, or which may be found under circumstances
which create suspicion of the commission of any offence.” The term “create” has created an
ambiguity that whether the discovery of the offence should be a sequel to the discovery of
suspicious bank transactions and not the other way around. On this aspect, the Supreme Court
has taken a view in the case of State of Maharashtra Vs. Tapas D.N. Neogy1 that there is no
such requirement that the bank transactions must create the suspicion of an offence in every case.
It was held that the police officer can seize the bank account if there is any direct link with the
commission of the offence for which the police officer is investigating into. However,

Associate at Salvador Raghav & Co.
ββ
Associate at Salvador Raghav & Co.
1
1999 (5) SCALE 613.
subsequently, the High Court of Madras in the case of R. Chandrasekar vs. Inspector of
Police, Fair Land Police Station Salem and Ors.2 held that the discovery of the offence must
precede the discovery of the suspicious transactions. The Court concluded that “There are no
circumstances attendant upon the bank account or its operation that have led the police to
suspect that some offence has been committed somewhere. The allegation of the prosecution is
that the bank account in this case is a sequel to the discovery of the commission of the offence.
This is not sufficient to attract Section 102 of Cr.P.C. as it cannot be since that the bank account
has been traced or discovered in circumstance which have made the police aware of the
commission of an offence.” Then, the High Court of Allahabad in Suninder Sandha vs. State of
U.P. and Ors.3 considered the decision of Apex Court in State of Maharashtra Vs. Tapas D.N.
Neogy4 and held that discovery of any offence can precede the discovery of suspicious bank
transactions. It was held that “Thus, various judgments of the High Courts cited by learned
counsel for the applicant on the proposition that powers under Section 102 of the Code, are to
be exercised only when discovery of a property leads to suspicion of a commission of an offence,
does not represent the correct statement of law in view of Neogy (supra), wherein it has been
held that if the property seized has links with commission of an offence under investigation,
power under Section 102 of the Code can be exercised.”

However, recently, the Supreme Court of Indi in Nevada Properties Private Limited vs.
State of Maharashtra and Ors.5 has held that Section 102“would not be attracted where the
property has not been traced or discovered which leads to a suspicion of an offence having been
committed. Discovery of property should precede the detection of crime.” However, again, the
Supreme Court of India in the case of OPTO Circuits (India) Ltd. v. Axis Bank, (2021) 6 SCC
707 held that the “……power under Section 102 CrPC is to the police officer during the course
of investigation.” Similarly, various High Courts such as Delhi High Court 6 and Karnataka High
Court7 have justified the act of investigation authorities of freezing the bank account during the
investigation of an offence which have come after the decision of Nevada Properties (supra).

2
2003 Cri LJ 294.
3
MANU/UP/0018/2018.
4
1999 (5) SCALE 613.
5
(2019) 20 SCC 119.
6
Ravina and Associates Pvt. Ltd. and Another v. Central Bureau of Investigation and Another, CRL.M.C. 1372/2021
and CRL. M.A. 8423/2021.
7
See R. Aneppa v. State of Karnataka, Represented by Police Inspector, CRL.R.P. No. 646/2020.
True Interpretation
The question now arises is which interpretation is more appropriate as per the settled
principles of statutory interpretation. The principles of interpretation have settled that the
intention of the legislature is primarily to be gathered from the language used, which means that
attention should be paid to what has been said as also to what has not been said. As a
consequence, a construction that requires for its support, addition or substitution of words or
which results in rejection of words as meaningless has to be avoided. 8 As settled by Privy
Council in the case of Renula Bose (Smt.) v. Rai Manmathnath Bose9 that “it is contrary to all
rules of construction to read words into an Act unless it is absolutely necessary to do so”.
Similarly, it is wrong and dangerous to proceed by substituting some other words for words of
the statute.

If we follow these settled principles of law, we would observe that clause (1) of Section
102 CrPC is very plain and does not create any ambiguity in itself. The words of a statute are
first understood in their natural, ordinary and popular sense. The phrases and sentences are
construed according to their grammatical meaning unless that leads to some absurdity or unless
there is something in the context, or in the object of the statute to suggest the contrary. 10 Thus, if
we read clause (1) of Section 102, CrPC, we would find that the legislature has stated in a very
plain language that “any police officer may seize any property…. which may be found under
circumstances which create suspicion of the commission of any offence.” The word “create” very
clearly and in very plain language specifies the condition that the property must create the
suspicion of commission of an offence. Any other interpretation tantamount to the substitution of
own meaning which is impermissible by the settled principles of statutory interpretation.

Thus, the interpretation of the courts that the police officer is empowered to seize the
bank account of an accused person during the investigation if there is any nexus between the
offence and the bank account seems incorrect in view of the above-said principles.

Conclusion

Although, it seemed that the decision of Nevada Properties (supra) would end the issue
of the true interpretation of clause (1) of Section 102 CrPC, the subsequent judgments of the
8
Shyam Kishori Devi v. Patna Municipal Corporation, AIR 1966 SC 1678.
9
AIR 1945 PC 108.
10
Crawford v. Spooner, (1846) 4 MIA 179.
Hon’ble Supreme Court and High Courts as above-cited show that the issue is yet to mature.
Probably, the issue that courts are facing is that if Section 102 CrPC does not empower the police
office to seize the bank accounts during the investigation, then under which provision the police
officer can prevent the future damage to happen if economic offences are allegedly committed
under the provisions of Indian Penal Code, 1860. It appears that the legislature needs to amend
the said provision to provide more clarity in respect to the powers of police officers under
Section 102 CrPC.