HC Quashes Criminal Case Against HSBC in 50-Year-Old Joint Account Dispute | Kashmir Life

SRINAGAR: The High Court of Jammu Kashmir and Ladakh on Wednesday quashed criminal proceedings against the Hongkong and Shanghai Banking Corporation (HSBC) and attorney-holder Shabeena Ibrahim in a 50-year-old joint account dispute, terming the complaint “an abuse of the legal process.”

The case arose from multiple joint accounts and fixed deposits opened in 1975 by the late Habibullah Mir and his daughter Jehan Habibullah, with survivorship instructions listed as “either or survivor.” Following Habibullah’s death in 2007, Jehan continued to operate the accounts as the surviving holder. The complainant, Mir Usman Disooki, alleged that HSBC had fraudulently changed account numbers and allowed Jehan to divert funds exceeding Rs 80 lakh, depriving other legal heirs of their share.

The Chief Judicial Magistrate, Srinagar, had taken cognisance of the complaint and issued a process. The complainant accused HSBC of releasing funds to Jehan without informing other heirs and alleged that Jehan diverted deposits to unknown accounts.

HSBC argued that the Magistrate lacked territorial jurisdiction and that payments to the surviving account holder constituted lawful discharge of liability under banking regulations. The bank maintained that no fixed deposits were prematurely encashed and that all transfers followed maturity instructions. Shabeena Ibrahim denied any role in the alleged diversion, stating her only involvement was filing a revocation petition of the succession certificate as attorney-holder.

Justice Sanjay Dhar observed that payment to the surviving joint account holder under RBI circulars provided a valid discharge to the bank. The Court ruled that any dispute over the funds could only be pursued between the legal heirs and the surviving holder, not against HSBC or Shabeena Ibrahim.

The High Court noted that the complaint contained “bald and vague allegations” against Ibrahim and that no material suggested wrongdoing by either petitioner. It concluded that filing the complaint against HSBC and Ibrahim was “nothing but an abuse of process of law.”

The Court clarified that any claims must be directed against Jehan Habibullah alone and affirmed that while alleged acts occurred in Delhi or Mumbai, the CJM Srinagar had territorial jurisdiction over the matter.

Both petitions were allowed, quashing the complaint and proceedings against HSBC and Shabeena Ibrahim. Proceedings against co-accused Jehan Habibullah, however, continue.