Vinayan K Vs Income Tax Department (Kerala High Court)
The petitioners, a husband and wife, maintained a bank account with the 3rd respondent bank. Their account had been frozen based on a written request issued by the Income Tax Department under Section 132(3) of the Income Tax Act, 1961, dated 11.08.2025.
The petitioners contended that the prohibitory order could remain in force only for 60 days under Section 132(8A) of the Income Tax Act. They stated that although this period had expired, the bank continued to prevent them from operating the account because the Income Tax authorities had not issued a communication lifting the prohibition. They therefore approached the Kerala High Court seeking directions to remove the prohibitory order.
During the hearing, the Standing Counsel for the Income Tax Department submitted that there were, as of then, no prohibitory orders concerning the freezing of the petitioners’ account.
In view of this submission, the High Court disposed of the writ petition by declaring that, in the absence of any prohibitory order from the Income Tax Department, the petitioners were entitled to operate their bank account. The Court directed the 3rd respondent bank to take the necessary steps accordingly.
FULL TEXT OF THE JUDGMENT/ORDER OF KERALA HIGH COURT
The petitioners are husband and wife, and they are maintaining an account with the 3rd respondent bank bearing No. 435010101394 at Mylapore Branch, Chennai. The grievance of the petitioners is that, the bank account of the petitioners has been frozen by the 3rd respondent, on the basis of a written request issued by the 2nd respondent under Section 132(3) of the Income Tax Act, 1961 on 11.08.2025. According to the petitioners, the prohibitory order freezing any bank account under Section 132(3) of the Income Tax Act can be in force, only for a period of 60 days from the date of the order, in the light of the stipulations contained in Section 132(8A) of the Income Tax Act. According to the petitioners, even though the said period already expired, the petitioners are unable to operate the bank account in view of the fact that, the 3rd respondent bank is not permitting to do so, in the absence of any further communication lifting the prohibitory order by the Income Tax Authorities. It was in these circumstances, this writ petition is filed seeking the following reliefs:
“a. issue a writ of mandamus or any other appropriate writ, order or direction, directing the 2nd respondent to issue a releasing order, removing the prohibitory order issued on the basis of Ext.P2 Panchnama proceedings, pertaining to the account No. 435010101394 maintained by the petitioners with the 3rd respondent.
b. issue any such other order or direction, as this Hon’ble Court may deem fit, fair and proper in the facts and circumstances of the case.
c. dispense with the production of English translation of the documents produced in vernacular language.”
2. Today when the matter came up for consideration, the learned Standing Counsel for the Income Tax Department submitted that, as of now, there are no prohibitory orders in respect of freezing the account of the petitioners.
In such circumstances, this writ petition is disposed of declaring that, in the absence of any prohibitory order by the Department of Income Tax, it shall be open to the petitioners to operate the account maintained by them with the 3rd respondent bank. Necessary steps shall be taken in this regard, by the 3rd respondent bank.
