India

I. Introduction The Attorney–client privilege (“ACP”) is a legal doctrine with origins in the 16th century English common law that, broadly speaking, protects all confidential communication made between an advocate and their client(s) to secure legal advice.[1] It is based on the fact that a client can have effective representation only when they are able to disclose every fact, favourable or unfavourable, without fear that such information may later be revealed or used against them.[2]  The major legal provisions governing the doctrine of attorney–client privilege in India are found in the Sections 132 to 134 of the Bharatiya Sakshya Adhiniyam, 2023 (“BSA”), the Advocates Act, 1961, and the Bar Council of India Rules,[3] which also provide for its exceptions, which broadly are - i. The client expressly consents to the advocate to divulge such communication.[4] ii. The client makes such communication to the advocate in “furtherance of any illegal purpose”.[5] iii. If a crime or fraud was committed after the start of an Advocate’s employment, does not remain protected by privilege.[6] iv. If any party calls the advocate as a witness, the party shall be considered to have consented to disclosing privileged matters only if he questions the advocate on these matters which, but for such questioning, the advocate would not be entitled to reveal.[7] v. If the client offers himself as a witness, he may be compelled to disclose information otherwise protected under this doctrine, to the extent that the Court deems it necessary for explaining or clarifying any part of his testimony.[8] The High Court (“HC”) of Jharkhand has observed in Nishikant Dubey[9] that the attorney client privilege protects not only the client but also the counsel. The advocate bound by his noble profession merely represents the accused without any personal interest in such cases, and just because for carrying out his duties, if proceedings were to be initiated against advocates for the acts of their clients, “no lawyer would be able to discharge his function without fear”. However, in recent times, there has been a noticeable surge in instances of investigating agencies and police summoning and searching advocates, raising serious concerns regarding their encroachment into the advocate–client privilege and the independence of the Bar.[10] This paper examines current position of the Indian judiciary on the limits of investigative powers in relation to the ACP through recent cases and points out that the lack of comprehensive guidelines has led to these recurring instances of overreach by investigating agencies. It finally concludes with some recommendations to ensure that investigative action does not encroach upon the independence of the legal profession. II. Limitation on Investigating Agencies through Attorney-Client Privilege. The Hon’ble Supreme Court (“SC”) had recently initiated suo motu proceedings in In Re: Summoning of Advocates Who Give Legal Opinions or Represent Parties During Investigation of Cases, taking cognisance of the increasing trend of investigating agencies summoning practising lawyers.[11] The issue gained prominence after the Gujarat Police summoned an advocate representing his client and the Enforcement Directorate (“ED”) issued summons to Senior Advocates Arvind Datar and Pratap Venugopal for their advisory work for Care Health Insurance.[12] In a Special Leave Petition (“SLP”), Ashwinkumar Govindbhai Prajapati v. State of Gujarat, the Police called upon the lawyer who filed a regular bail application on behalf of his client under 179 of the Bhartiya Nagarik Suraksha Sanhita, 2023 (“BNSS”), “to know the true details of facts and circumstances” the petitioner was asked to appear at the office of the police commissioner.[13] The HC had allowed the summons, noting that it was in the capacity of a witness. The SC prima facie agrees that lawyer was not personally involved in any manner in the case and was merely representing the accused. “The FIR pertains to a dispute between the complainant and the accused, and the petitioner has no connection beyond his role as a lawyer for the accused.” [14] The Court recognised the importance of the legal profession as an integral part of the judicial system and noted that advocates possess certain rights and privileges essential to its functioning.[15] Allowing investigating agencies to summon defence counsel or advising lawyers directly would seriously undermine professional autonomy and the independence of the justice process.[16] And thus, the bench placed before the Chief Justice of India (“CJI”) two questions to be taken up- [17] When an individual is engaged with a case merely as a lawyer advising the party, can they be directly summoned by such agencies for questioning? If there is evidence by such agencies that their enagement in such cases is beyond that of a mere lawyer, whether judicial oversight should be prescribed or direct summons by them should be allowed? In this context, it becomes necessary to examine the current position adopted by Indian courts on the limits of investigative authority and the protection of attorney–client privilege. Current Legal Position The current legal position governing investigations against advocates in India is broadly based on the SC’s judgement in Punjab vs. Sodhi Sukhdev Singh[18] in 1961 – “It is a settled legal position that a communication is privileged if it is made to a legal advisor by a client after the commission of a crime and with a view to his defence, but it is not privileged if it is made before the commission of the crime or wrong and for the purpose of being guided or assisted in furthering or committing it.” This distinction, based on the exceptions to Section 132 of the BSA, still forms the basis for determining when investigative authorities may lawfully access privileged communications between advocate and their client. In Puneet Batra vs. Union of India[19] – The Anti evasion branch of the Goods and Services Tax (“GST”) department conducted a search at the attorney’s office after he failed to appear for the summons orders, and seized materials including electronic records that contained confidential information regarding his clients. The court held that such materials are protected by the attorney client privilege and unless there is prima facie evidence to prove that the attorney is also personally involved along with the client, such a measure amounts to harassment of an advocate. In, Himanshu Kumar Ray vs. West Bengal,[20] The police officers sending standardised general notices to lawyers for appearing as witnesses under S. 160 of The Code of Criminal Procedure, (“CrPC”), without individually investigating them first. The court informed them that they could not investigate advocates for information regarding their clients as it is protected by attorney-client privilege. Further held that such generalised standard form notices sent to lawyers is violation of Section 160 of CrPC. In AK Pavithran vs. Cental Bureau of Investigation (“CBI”)[21] where the attorney was summoned under Section 160 of CrPC. to the Inspector’s office to question him regarding information on his client who was accused under the Prevention of Corruption Act, 1988 (“PC Act”), the court said that neither was any evidence against the attorney placed on record, nor was the case brought in any of the two exceptions provided under 126 of the Indian Evidence Act (“IEA”). It was said that “Deference to the provisions of Section 126 of the Evidence Act does not amount to interference with investigations.” Thus, Investigative action against a lawyer requires case-specific prima facie evidence of personal involvement or should show that the two exceptions of S.132 apply – communications made in furtherance of an illegal purpose or relating to a crime or fraud committed after the commencement of professional engagement.[22] Routine or standardised summons against lawyers by the Police or other investigative agencies are a clear violation of their powers. Recent precedents also show that if an advocate’s testimony is considered necessary by the police and the investigative agencies, the summons must explicitly state that it is issued in the capacity of a witness and not in their professional capacity. Any such inquiry must remain confined to independent factual matters and cannot compel the disclosure of privileged communications between lawyer and client. Else, it only amounts to intimidation and  harassment and a violation of the advocate’s right to practise freely under Article 19(1)(g) of the Constitution.[23] In Ajithkumar v Kerala,[24] it was said that under 179 of BNSS, “the police can issue a summons to an advocate as a suspect or witness, and not in his professional capacity”. 179(1) cannot be used by the police to breach the attorney client privilege. When issuing a notice under Section 35(3), instead of issuing them routinely, the police must show reasonable basis. Else, it would violate the attorney’s fundamental rights. Here an advocate was representing a couple who were alleged to be Bangladeshi nationals. He received a notice under S. 35(3) BNSS summoning him for questioning and warning of arrest if he chose not to appear. The advocate approached the High Court, and following their reprimand, the notice was withdrawn by the police. As will be seen in these cases, the Courts have, even after such notices were withdrawn, still proceeded against these authorities, to ensure they do not “set a dangerous precedent”[25] which is significant as the very act of issuing such notices are a gross disregard for the attorney–client privilege. In Praram Infra v. State of M.P,[26] The client in this case was accused of financial fraud of crores of rupees under the Indian Penal Code (“IPC”). After the advocate filed a writ petition (which was later disposed) asking for an unbiased probe into the matter, he was summoned by the Police to provide statements and signature samples under 91 & 160 of CrPC. Though the notice was later withdrawn, to avoid setting a dangerous precedent, the court heard the attorney and held since neither was there any evidence that there was any “furtherance of illegal purpose” and since clearly the lawyer was representing the accused after the alleged act had occured neither could he have been a witness and nor was he an accused and could not have been summoned under S.160 of CrPC. Finally, In Maulikkumar Satishbhai Sheth,[27] the Court laid down certain guidelines regarding investigation procedures under Section 132 of the Income Tax (“IT”) Act. Such people can only be summoned when the exercise of this power can only follow a reasonable belief that any of the three conditions mentioned in section 132 of the Income Tax exists and the Director of Inspection or the Commissioner has to record his reasons before the authorisation is given. Attorney–client privilege shall extend to the documents or data seized from the petitioner, in exception to the IEA’s provisions on ACP. Therefore, in order to apply the provision of Section 126 of the authorities can consider the documents which are incriminating which falls under the two exceptions of s.126 of the Evidence Act. However, for the documents under illust. (a) Section 126, no action can be taken. “No further litigation would arise in the case of third parties whose documents were found during the course of the search."[28] This privilege shall also protect the 3rd parties / client of the advocate in the event that any proceedings are initiated by the IT Dept. on the basis of material seized from the advocate’s office. These guidelines, even though laid under the Income Tax Act, such should also be applicable to the customs law and GST investigations due to their similarity.[29] As for the Prevention of Money Laundering Act, 2002 (“PMLA”), Under Section 50, the Enforcement Directorate’s Director exercises powers akin to those of a civil court, and summons proceedings under Section 50(2), (3) of the PMLA is deemed to be a judicial proceeding as per the Bharatiya Nyaya Sanhita, (“BNS”).[30] As Section 1 of the BSA[31] extends the Act’s applicability to all judicial proceedings before any court or authority, the provisions of Sections 132 to 134—governing attorney–client privilege—are thus applicable here.[32] In light of these decisions, the Gujarat HC’s decision in Ashwinkumar Prajapati stands as an anomaly. Such inconsistency, howsoever little, shows the need for clear guidelines to ensure protection of advocates against overreach by these investigative agencies. Recommendations i. Judicial oversight in Summoning Lawyers and conducting searches and seizures Judicial oversight is crucial to prevent the misuse of investigative powers against advocates and to maintain the sanctity of the advocate–client relationship. Without such scrutiny, the power to summon lawyers risks becoming a tool of intimidation rather than investigation, deterring lawyers from freely representing clients in sensitive or adversarial matters.[33] Oversight by a judicial authority ensures that any interference with legal privilege occurs only when supported by credible and specific material, thereby preserving both the independence of the Bar and public confidence in the fairness of investigations.[34] Support for judicial oversight in summoning advocates can be found both in Indian precedents and in comparative legal systems. In Jacob Mathew,[35] the Supreme Court of India held that criminal proceedings against doctors for negligence can be initiated only after obtaining an independent and competent medical opinion and framed guidelines in this regards. This logic should extend to the legal profession, where a similar threshold of review may be necessary before interfering with an advocate’s role.[36] Internationally, In Niemietz v. Germany, the European Court of Human Rights held that searches of a lawyer’s office engage the right to privacy under Article 8 of the European Convention on Human Rights, noting that such searches “may have repercussions on the proper administration of justice,” and therefore lawyer’s offices are to have enhanced protection.[37] The US also has rules framed by the US Department of Justice to safeguard the interest of lawyers during search and seizures.[38] Further, Section 223 of the BNSS establishes a new pre-cognizance stage for complaint cases, requiring a Magistrate to give the accused an opportunity to be heard before taking cognizance of an offense.[39] This provision reflects a legislative intent to institutionalise judicial oversight as a procedural safeguard against arbitrary or premature criminal prosecution. This model may be can be modified and adopted for advocates, ensuring that any summons or search against them is subjected to a stricter scrutiny before investigative action is permitted. At present, there are no proper guidelines to protect privileged material during searches or seizures, in Maulikkumar HC has laid down guidelines but they are only limited to the Income Tax Department, and it is a High Court precedent.[40] This gap is worsened by the absence of uniform standards across bodies like the ED, CBI, GST Dept., and even intra bodies, (The ED being the investigating body in the PMLA, Foreign Exchange Management Act (“FEMA”), and the Fugitive Economic Offenders Act (“FEOA”) ), each applying its own inconsistent approach.[41] Such unchecked executive discretion has led to instances of harassment and a chilling effect on advocacy, which lawyers face merely for representing their clients. In the United Kingdom, searches and seizures need to be authorised by a justice of the peace.[42] Further, during searches of a lawyer’s offices, agencies must employ independent officers to segregate privileged materials before review. This was considered by the court in Maulikkumar, but disregarded saying it might set a dangerous precedent but the court was wary of the possibility of misuse by the investigating authorities against third parties and warned them against it.[43] The USA has a similar practice where the judge in certain cases appoints a “neutral third party” who reviews such documents.[44] ii. Lawyers may not be summoned when they are a solely advising party. This position seems to be settled as the different HCs through many cases like Puneet Batra, Ajithkumar, Praram Infra, which have been discussed above in Section II(1). It has been repeatedly held that advocates acting purely in their professional capacity cannot be summoned or compelled by investigating agencies to disclose information protected by Attorney client privilege.[45] This position preserves not only the sanctity of privilege but also the nobility and independence of the legal profession as subjecting lawyers to repeated summons or raids for acts done in their professional capacity amounts to intimidation and harassment, eroding the dignity attached to the practice of law.[46] Moreover, compelling a lawyer to assist in an investigation violates the fundamental right under Article 19(1)(g) to practice one’s profession freely.[47] These actions create a chilling effect on the legal profession, deterring advocates from discharging their duties with the independence essential to the proper administration of justice.[48] iii. Illegally obtained evidence through search and seizures In India, whether the fact in question is a “relevant fact” under the BSA is the only bar to its admissibility unless any legislation explicitly bars the admissibility of such illegally obtained evidence.[49] This was laid down by the SC in Pooran Mal v. Director of Inspection [50] where it was examining obtained evidence from an allegedly illegal search operation conducted by the Income Tax department. Even after the Puttaswamy judgement, the Pooran Mal position was reiterated in Yashwant Sinha[51] too in 2019. This is the strictest of approaches, unlike the doctrine of the "Fruit of the poisonous tree", which prohibits the admissibility of illegally obtained evidence in the USA.[52] This gap effectively incentivises investigative agencies to bypass privilege through unlawful searches or seizures; However, Indian HCs have refused to entertain any evidence obtained in violation of the attorney client privilege as observed in Puneet Batra and Maulikkumar.[53] But as Pooran Mal still continues to be good law, it must be noted that S.132 of the BSA[54] places a bar on what an advocate may disclose, but it does not bar a court from admitting such illegal evidence obtained. Therefore, if privileged material is acquired by an investigating agency—through an illegal search or seizure—the provision does not explicitly prevent the court from admitting it. Hence, an explicit statutory bar on the admissibility of such material should be incorporated, as the Pooran Mal judgement so requires. Recently, the Apex Court has finally pronounced judgement in this matter in the suo motu case of “Re: Summoning Advocates Who Give Legal Opinion or Represent Parties During Investigation of Cases and Related Issues”.[55] Where, although it refused to offer magisterial oversight in summons issued to lawyers by such agencies, it did quash all the summons in question in the case and laid down certain directives for the agencies to conform to.[56] It categorically held that lawyers could only be summoned under the two exceptions stated under the S. 132 of BSA, which as discussed, has before this been repeatedly affirmed by the HCs in many decisions. Secondly, it has said judicial review under inherent powers of the High Court can be resorted to by the lawyers and their clients to challenge the summons.[57] However, such review operates only after issuance, and thus does not substitute for preventive judicial scrutiny that the magistrate’s oversight could provide before such summons would be issued in the first place, particularly in filtering out cases lacking prima facie material. Thirdly, it held that digital records seized must only be opened in the lawyer and the parties’ presence, an adaptation from the Maulikkumar guidelines that the Delhi HC recently pronounced.[58] Fourthly, the court reaffirmed its previous position that in-house counsels cannot avail the attorney client privilege afforded under these provisions.[59] The judgment effectively consolidates earlier High Court rulings on this matter. While the Court described its directions as an attempt to “harmonise evidentiary and procedural rules,”[60] it stopped short of prescribing preventive judicial oversight, leaving a crucial gap in safeguarding advocates from investigative overreach. iv. Conclusion Attorney–client privilege is vital to an independent judiciary, yet its protection in India still remains slightly inconsistent.[61] Although the HCs and the Hon’ble SC have held that advocates cannot be summoned in their professional capacity, the absence of uniform statutory safeguards allows investigative overreach to persist.[62] The current judicial pronouncements on this matters offers some protection, but without proper guidelines, investigative agencies continue their overreach without any clear restraint.[63] To preserve both the independence of the Bar and public confidence in justice, explicit legislative guidelines, prior judicial oversight, and a bar on the admissibility of illegally obtained privileged material are urgently needed.[64] [1] Karandeep Makkar, “Client Confidentiality and Lawyer-Client Privilege: A Study of Indian, American and English Laws” SSRN (2010), available at: https://ssrn.com/abstract=1722569 (last visited on October 20, 2025). [2] Id. [3] Shalini Vasishtha, “Confidentiality and Limitations of Attorney-Client Privilege” SSRN (2020), available at: https://ssrn.com/abstract=3703942 (last visited on October 20, 2025). [4] The Bharatiya Sakshya Adhiniyam, 2023 (Act 47 of 2023), s. 132. [5] The Bharatiya Sakshya Adhiniyam, 2023 (Act 47 of 2023), s. 132, cl. (1) (a). [6] The Bharatiya Sakshya Adhiniyam, 2023 (Act 47 of 2023), s. 132, cl. (1) (b). [7] The Bharatiya Sakshya Adhiniyam, 2023 (Act 47 of 2023), s. 133. [8] The Bharatiya Sakshya Adhiniyam, 2023 (Act 47 of 2023), s. 134. [9] Nishkant Dubey v. State of Jharkhand, 2023 SCC OnLine Jhar 304. [10] Pragya Parijat Singh, “Privileged and Confidential: Tracing Attorney-Client Communication” Bar & Bench, June 25, 2025, available at: https://www.barandbench.com/columns/privileged-and-confidential-tracing-attorney-client-communication (last visited on October 20, 2025). [11] SMW(Crl) No. 2/2025. [12] Supra note 10. [13] 2025 SCC OnLine SC 1384. [14] Apoorva, “Supreme Court stays police summons to lawyer; Investigating Agency powers under scrutiny” SCC Online (June 26, 2025), available at: https://www.scconline.com/blog/post/2025/06/26/supreme-court-stays-police-summons-to-lawyer-investigating-agency-powers/  (last visited on October 20, 2025). [15] Id. [16] Id. [17] Supra note 13. [18] AIR 1961 SC 493. [19] 2025:DHC:7897-DB. [20]2023 (96) TMI 943 [21] 2024 SCC OnLine Bom 1158 [22] V. Venkatesan, “Supreme Court’s Strictures Against Summoning Lawyers Are Backed by Precedents” Supreme Court Observer (3 July 2025), available at: https://www.scobserver.in/journal/supreme-courts-strictures-against-summoning-lawyers-are-backed-by-precedents-lawyer-summons/ (last visited on 20 Oct. 2025). [23] Id. [24] 2025 LiveLaw (Ker) 223. [25] 2025 SCC OnLine MP 2737. [26] Id. [27] SCA/20187/2023;  Sudipta Bhattacharjee, “Gujarat High Court on Attorney-Client Privilege in Context of Search and Seizure Operations under Tax Laws” Bar & Bench (23 Apr. 2024), available at: https://www.barandbench.com/view-point/gujarat-high-court-attorney-client-privilege-search-and-seizure-tax-laws (last visited on 20 Oct. 2025). [28] Id. [29] Id. [30] The Prevention of Money Laundering Act, 2002 (Act 15 of 2003), s. 50. [31] The Bharatiya Sakshya Adhiniyam, 2023 (Act 47 of 2023), s. 1(1). [32] Shaffi Mather, “Summoning Advocates by Enforcement Directorate” LiveLaw (26 June 2025), available at: https://www.livelaw.in/articles/summoning-advocates-enforcement-directorate-295855 (last visited on 20 Oct. 2025). [33] Dhananjay Mahapatra, “SC agrees with petitioner on attorney-client privilege” The Times of India, June 26, 2025, available at: https://timesofindia.indiatimes.com/india/sc-agrees-with-petitioner-on-attorney-client-privilege/articleshow/122081520.cms (last visited on Oct. 20, 2025). [34] Id. [35] Jacob Mathew v. State of Punjab, (2005) 6 SCC 1. [36] Parmod Kumar, “Supreme Court reserves judgment in suo motu case on summons to advocates over legal advice; Bar bodies suggest magistrate’s approval” The Leaflet (12 Aug. 2025), available at: https://theleaflet.in/leaflet-reports/summons-to-advocates-over-legal-advice-ag-sg-oppose-bar-associations-suggestion-for-magistrates-approval-sc-reserves-judgment (last visited on 20 Oct. 2025). [37] (1992) 16 EHRR 97; Shailee Basu, “Investigative agencies summoning lawyers violates the lawyer-client privilege” The Indian Express (27 Jun. 2025), available at: https://indianexpress.com/article/opinion/columns/investigative-agencies-summoning-lawyers-violates-the-lawyer-client-privilege-10092427/ (last visited on 20 Oct. 2025). [38] H. Marshall Jarrett & Michael W. Bailie (eds), Searching and Seizing Computers and Obtaining Electronic Evidence in Criminal Investigations (3rd ed, Executive Office for United States Attorneys, Office of Legal Education, 2009), available at: https://www.justice.gov/d9/criminal ccips/legacy/2015/01/14/ssmanual2009_002.pdf [39] The Bharatiya Nagarik Suraksha Sanhita, 2023 (Act 46 of 2023), s. 223. [40] Supra note 27. [41] Id; Maheshwari & Co., “Facing an Enforcement Directorate (ED) Investigation? Here’s What You Must Know” Mondaq India (6 Oct. 2025), available at: https://www.mondaq.com/india/compliance/1686744/facing-an-enforcement-directorate-ed-investigation-heres-what-you-must-know (last visited on 20 Oct. 2025). [42] Supra note 37. [43] Supra note 27. [44] Supra note 38. [45] Supra note 24. [46] Supra note 13. [47] Id. [48] Supra note 37. [49] Kartik Gupta, “Admissibility of Unlawfully Obtained Evidence in International Arbitration” NLIU Law Review Vol XI, Issue II (2022) 97. [50] Pooran Mal v. Director of Investigation, (1974) 1 SCC 345. [51] Supra note 49. [52] Yashwant Sinha v. Central Bureau of Investigation, [53] Supra note 19; Supra note 27. [54] The Bharatiya Sakshya Adhiniyam, 2023 (Act 47 of 2023), s. 132. [55] SMW(Crl) No. 2/2025. [56] Debayan Roy, “Lawyers can’t be summoned over advice to clients unless exceptional circumstances exist: Supreme Court”, Bar & Bench, 31 Oct. 2025, available at https://www.barandbench.com/news/lawyers-cant-be-summoned-over-advice-to-clients-unless-exceptional-circumstances-exist-supreme-court (last visited 31 Oct. 2025). [57] Aditi Gyanesh, “No Summons to Advocates Except Under S.132 BSA Exceptions: Prior Approval of Superior Officer Mandatory, Supreme Court Issues Directions”, LiveLaw, Oct. 20, 2024, available at https://www.livelaw.in/top-stories/no-summons-to-advocates-except-under-s132-bsa-exceptions-prior-approval-of-superior-officer-mandatory-supreme-court-issues-directions-308398 (last visited on Oct. 31, 2025). [58] Id. See also – Sudipta Bhattacharjee, “Gujarat High Court on Attorney-Client Privilege in Context of Search and Seizure Operations under Tax Laws” Bar & Bench (23 Apr. 2024), available at: https://www.barandbench.com/view-point/gujarat-high-court-attorney-client-privilege-search-and-seizure-tax-laws (last visited on 20 Oct. 2025). [59] Id. [60] Id. [61] Supra note 13. [62] Supra note 22. [63] Supra note 27. [64] Supra note 37.

INTRODUCTION Order XXI Rule 97 of the Code of Civil Procedure (“CPC”) deals with situations wherein a decree-holder, when taking possession of immovable property after a decree has been passed in their favour, is obstructed or resisted from doing so by a third party. According to this rule, the decree-holder facing such resistance can apply to the executing court claiming their rights and complaining about such resistance. After such application has been made, the court shall decide whether the resistance was valid, and with which party the right of possession lies. However, with respect to a third party who is neither the decree-holder nor the judgment-debtor but has claimed possession of a property, there are interpretations of Order XXI Rule 97 of CPC where various courts have interpreted in different ways. Such convolutions in judgements have complicated the processual law, making it a complex domain. ADJUDICATION OF THIRD-PARTY RIGHTS A third party who is in possession of an immovable property has the right to file an application under Order 21 Rule 97 of CPC, complaining about their grievances. According to Rule 101 of CPC, there is no requirement of filing a separate suit because, in accordance with Rule 101 of CPC, the executing court will ultimately decide all disputes. In the case of Shreenath and Anr v.Rajesh and Ors.[1] it was discussed that the adjudication of the third-party rights has to be conducted within the execution proceedings and not by filing separate suits because that would lead to a long litigation. In the case of Brahmdeo Chaudhary v. Rishikesh Prasad Jaiswal and Ors.[2], the main issue was whether a person who is not a party to a decree and opposes its execution could have their concerns decided without first being evicted.  The Supreme Court of India ruled that such a person might in fact have their concerns considered under Order XXI Rule 97 of CPC prior to dispossession. The Supreme Court reiterated that the rules in Order XXI of of CPC together form a complete system for dealing with problems that arise during execution of a decree for possession of property. Where a decree-holder encounters resistance or obstruction in taking possession, the proper course is to invoke Rule 97 of CPC, under which the executing court must hear both parties and determine the legitimacy of the resistance before passing appropriate orders. On the other hand, Rule 99 of CPC only applies where a third party not bound by the decree has already been evicted without having a chance to protest and requests that their possession be returned on the grounds of unlawful eviction. The Court underlined that the decree-holder cannot directly request help of police force under Rule 35 of CPC to avoid judicial adjudication once an obstruction has been recorded. Instead, the executing court must decide the issue under Rule 97 of CPC. Accordingly, the Court held that a person asserting an interest in the property may raise objections and seek adjudication even prior to dispossession, rejecting the High Court’s interpretation that an objector must first surrender possession before pursuing recovery under Rule 99 of CPC. The Court granted the appeal and upheld natural justice principles by overturning the High Court’s ruling and sending the matter back to the executing court to decide the appellant’s claim in accordance with Order XXI Rule 97 of CPC. 2.1 Remedy of Third Parties in Execution Proceedings For third party to secure his rights, an efficient way is to file an application within the executing proceeding. There are precedents, however, where Order XXI Rule 97 of CPC has been interpreted in a way so as to lay down the option of filing a separate suit. In the case of Usha Jain v. Manmohan Bajaj[3], the Court stated that two options exist for the third party to file an application under Order XXI Rule 97 of CPC. Either the third party can file an application after dispossession under Order XXI Rule 99 of CPC, and the executing Court will be mandated to adjudicate the matter under Rule 99 of CPC, or the third party can file a separate suit praying for a declaration of title. In Brahmdeo Chaudhary v. Rishikesh Prasad Jaiswal and Ors[4], the Court clarified that when a decree-holder faces resistance or obstruction, they must apply under Rule 97 of CPC, and if a third party is unlawfully dispossessed, they may apply under Rule 99 of CPC. Both situations must be adjudicated by the executing court itself, and the resulting order is treated as a decree, appealable but not subject to a separate civil suit. The Court further ruled that a third party can raise objections either before or after dispossession, ensuring compliance with the principles of natural justice and preventing multiplicity of proceedings. Therefore, now it is a settled law that a separate suit need not be filed by a third party, and his grievances may be addressed within a single execution proceeding under Order XXI Rule 97 of CPC. BALANCE WITH THE DECREE HOLDER RIGHTS Although Order XXI Rule 97 ensures that the rights of decree-holders are safeguarded, such rights cannot override the lawful possession or interests of third parties who were not part of the original suit but lawfully possess the property. In Shreenath & Anr. v. Rajesh & Ors[5], the Court observed, “In interpreting any procedural law, where more than one interpretation is possible, the one which curtails the procedure without eluding justice is to be adopted. The procedural law is always subservient to and is in aid of justice. Any interpretation which eludes or frustrates the recipient of justice is not to be followed.” The rights of such third parties must therefore be duly recognised and protected during the execution of the decree. In Brahmdeo Chaudhary v. Rishikesh Prasad Jaiswal and Ors[6] and Silverline Forum Pvt. Ltd. v. Rajiv Trust and Ors[7],  courts have underscored the importance of maintaining a balance between the rights of decree-holders and those of bona fide third parties with an aim to achieve an equitable solution. Yet again, a barrier exists in the deliverance of justice. The Supreme Court of India, in Sriram Housing Finance & Investment (India) Ltd. v. Omesh Mishra Memorial Charitable Trust[8], held that under Order XXI Rule 97 of CPC, only the ‘decree-holder’ is entitled to make an application when he faces resistance or obstruction by “any person”. Furthermore, the Supreme Court noted that any third party, other than the decree-holder or the purchaser of scheduled property at an auction, in pursuance of execution of decree, is not entitled to make an application under Order XXI Rule 97 of CPC. The relevant portion reads as follows: “24. On conjoint reading of the aforesaid provisions, it can be observed that under Rule 97, it is only the “decree-holder” who is entitled to make an application in case where he is offered resistance or obstruction by “any person”. In the present case, as admitted by the appellant itself, it is a bona fide purchaser of the property and not the “decree holder”. The Court noted that the appellant could not invoke Rule 97 of CPC to challenge the execution of the decree passed in favour of the respondents. Furthermore, the Court also stated that Rule 99 of CPC pertains to complaints made to the Court against “dispossession” of immovable property by a person in “possession”, at the instance of a decree-holder. The Sriram Housing Finance case precedence disrupts the balance which courts tried to achieve by prioritizing the enforcement of a decree over due process for third parties, potentially leading to multiplicity of suits. Such a situation may compel third parties to seek remedies through separate suits thus causing chaos and imbalance, and refutes the constitutional principles of fairness, justice and due process of the law. However, a shift has been observed in interpreting the letter of the law. The judgement of the Supreme Court in Periyammal (Dead) Through LRs & Ors. v. V. Rajamani & Anr.[9], the Apex Court set aside the order of the executing court and laid down that processual laws must not hinder the deliverance of justice. A conjoint reading of various case precedents in this pretext clarified that in executing a decree for possession, the court can deliver actual possession to the decree-holder and remove only those “bound by the decree” under Rule 35 of CPC. Rules 97-101 of CPC address resistance by “any person,” including strangers claiming independent or derivative rights. Thus, Rule 97 of CPC provides remedies for both decree-holders and third parties who obstruct possession, while Rule 99 of CPC applies when such third parties are already dispossessed and seek restoration. Under Rule 101 of CPC, the executing court must decide all relevant questions of right, title, or interest arising between the parties. The order passed thereafter is deemed a decree, against which an appeal lies and no separate suit is maintainable. Thus, this judgement counters the Sriram Housing Finance case judgement. In Sriram Housing, the court had taken a restrictive approach, holding that a third party could seek redressal of their grievance only after dispossession under Order XXI Rule 99 of CPC. In contrast, the Supreme Court in Periyammal decision adopted an expansive interpretation. It recognised that both decree-holders and bona fide third parties with lawful claims can seek adjudication within execution proceedings under Order XXI Rule 97 of CPC. Such departure from the previous judgement reflects the primary notion that the courts have a major role in balancing the interests to ensure equity and fair play, and also avoid multiplicity of proceedings. However, yet again there arises a discrepancy with regard to the relief granted to third parties which lies in the distinction of ‘independent third parties’ and ‘derivative claimants of judgement-debtor’. Rule 102 of CPC expressly states that derivative claimants from the judgment-debtor cannot maintain an application under Rule 97 of CPC because they are deemed to be bound by the decree. The Bhramdeo judgement also affirms that only third parties with ‘independent right, title or interest’ make a valid application under Rule 97 of CPC. Rule 102 of Order XXI of CPC has been inserted with the clear intention to achieve finality in judicial decisions. The provision incorporates the principle of “interest reipublicae ut sit finis litium” that is, it is in the interest of the State that there should be an end to litigation. Furthermore, the Delhi High Court in Leelawati v. Rajiv Kumar[10], reaffirmed that Order XXI Rule 99 CPC is meant for a third party who is a stranger to a decree. A judgment-debtor’s wife cannot make use of this provision. Additionally, in Sanjay Kumar Yadav v. Kaushal Kumar Mishra & Ors.[11], the Patna High Court dismissed a writ petition under Article 227 which challenged the rejection of an application filed under Order XXI Rule 97 of CPC in an eviction execution suit. The petitioner, who is originally a judgment-debtor, claimed that after purchasing the decretal property from one of the decree-holders, his status had changed and the decree was no longer executable. The Court held that such a purchase did not transform his position into that of a third party or decree-holder, as the joint decree in favour of multiple decree-holders remained indivisible under Order XXI Rule 15 of CPC. It concluded that since the petitioner continued to be a judgment-debtor, his application under Order XXI Rule 97 of CPC was not maintainable. In conclusion, under the strict letter of the law, not all third parties but only independent third parties with valid right claim or interest in a decretal property has the option to file an application under Rule 97 of CPC. This is observed with the goal to ensure fairness, justice, and equity, and prevent multiplicity of proceedings. LEGITIMACY OF THIRD-PARTY POSSESSION CLAIMS Courts determine the legitimacy of third-party possession claims under Order XXI Rule 97 of CPC by conducting a summary inquiry into whether the possession is lawful, independent, and not derivative of the judgment-debtor. The key consideration is whether the third party is in actual, settled possession at the time of execution and whether such possession is backed by a claim of ownership, tenancy, or other lawful interest. The burden lies initially on the third party to prima facie establish their right, title, or interest, after which the executing court evaluates the evidence, such as title deeds, lease agreements, tax receipts, and the nature of occupation. In the case of Ram Chandra Verma v. Manmal Singhi 1982[12], the question before the Sikkim High Court in the 1982 case of Ram Chandra Verma v. Manmal Singhi was whether the executing court may move forward notwithstanding the objections of a third party in possession of the decretal property, arguing that it was not bound by the decree.  The High Court heard the appeal from the executing court, which decided that the application was denied because there was no explicit clause allowing a third party to object to the execution.  The Sikkim High Court, however, placed a strong focus on the breach of natural justice principles that would have happened if the executing court's opinion had been accepted. To address the alleged infraction, the High Court read Rule 35 of Order 216.  According to the High Court, the term "any person bound by the decree" only refers to the judgment debtor and any other individuals who made a claim on their behalf.  As a result, a third party asserting a right or title over the decretal property separate and apart from the judgment debtor was exempt from Rule 35.  The High Court decided that a court would be required to take such objections into consideration under Rule 35 of CPC in the interest of natural justice since it was impossible to determine whether a third party had an independent right without hearing the third party. EVIDENTIARY STANDARD THAT SHOULD APPLY TO THIRD PARTIES CLAIM The evidentiary standards applicable to third-party resistance under Order XXI Rule 97 of CPC are rooted in summary civil procedure, but require the third party to establish a prima facie, lawful, and independent right to possession. The resisting party have to produce documentary evidence indicating ownership or lawful occupation not derived from the judgment-debtor. The third party must show they are not a mere proxy, licensee, or tenant-at-will under the judgment-debtor. Courts are also cautious of collusive or post-decree transfers meant to defeat execution and will disregard possession that lacks bona fides. The main issue in the case of Silverline Forum Pvt. Ltd. vs. Rajiv Trust and Ors.[13] was whether a sub-tenant, not party to an eviction decree, could resist its execution. Silverline Forum Pvt. Ltd. (appellant) sought to evict Rajiv Trust (respondent) and its sub-tenants from a property in Calcutta. The Supreme Court held that the sub-tenant, M/s. Capstain Shipping Estate Pvt. Ltd., was bound by the eviction decree as it did not notify the landlord of its sub-tenancy as required by the West Bengal Premises Tenancy Act, 1956. The Court allowed the appeal, setting aside the High Court's order, and granted Silverline Forum Pvt. Ltd. the right to possession by removing the sub-tenant's resistance. Again in the case  Bhanwar Lal v. Satyanarain and Anr.,[14] a three - Judge Bench has stated as under: “reading of Order 21, Rule 97 of CPC clearly envisages that "any person" even including the judgment-debtor irrespective whether he claims derivative title from the judgment-debtor or set up his own right, title or interest de hors the judgment debtor and he resists execution of a decree, then the court in addition to the power under Rule 35(3) has been empowered to conduct an enquiry whether the obstruction by that person in obtaining possession of immovable property was legal or not. The degree-holder gets a right under Rule 97 of CPC to make an application against third parties to have his obstruction removed and an enquiry thereon could be done." BONA FIDE PURCHASER RIGHTS AND THE DOCTRINE OF LIS PENDENS A bona fide purchaser is who acquires immovable property for value and without notice of an ongoing suit may resist execution, provided they establish that their purchase occurred before the decree or without knowledge of the pending litigation. However, Section 52 of the Transfer of Property Act, embodying the doctrine of lis pendens, renders any transfer during the pendency of a suit subject to the outcome of that suit. Thus, a purchaser acquiring property pendente lite steps into the shoes of the judgment-debtor and cannot resist execution if the decree goes against the seller. Courts have consistently held that while Rule 97 of CPC allows third-party resistance, the right to possession must not be tainted by lis pendens, fraud, or collusion. In K.K. Verma v. Union of India[15] courts have ruled that a lis pendens transferee cannot claim independent rights unless they prove lack of notice and good faith under the standards of a bona fide purchaser. Hence, a third party’s ability to invoke Rule 97 of CPC is constrained by lis pendens, but protected if the purchase predates litigation and the possession is genuine and lawful. INCONSISTENCIES IN THE INTERPRETATION OF ORDER XXI RULE 97 OF CPC While Ram Verma case 1982[16] provided the third-party power to apply to the executing court under Rule 35 of CPC to object to the execution, the Madhya Pradesh High Court, in Bhagwat Narayan Dwivedi v. Kasturi 1933[17], put the entire burden on the decree-holder. It was held that all the third-party had to do was to inform the court that he was in possession of the decretal property on the basis of a right independent of the judgment-debtor and not at the latter’s instigation. If this was done, the entire burden would then shift to the decree-holder to prove that the objector is, in fact, a “person bound by the decree” under Rule 35 of CPC. If the decree-holder failed in proving this, the executing court could not proceed with the execution until he filed an application under Order 21 Rule 97 of CPC, complaining of such resistance or obstruction. Various High Courts in India have adopted divergent interpretations of Order XXI Rule 97 of CPC, especially regarding whether a third party (not party to the original suit) can independently invoke this provision to resist execution. Calcutta High Court in some cases has allowed third parties to file Rule 97 of CPC applications to protect independent possession, aligning with the Supreme Court's view in Brahmdeo Chaudhary’s judgement but Allahabad and Delhi High Courts have held that only decree-holders or auction purchasers can initiate applications under Rule 97 of CPC, requiring third parties to resort to separate civil suits, as echoed in Sriram Housing Finance v. Omesh Misra Trust. Moreover, there is inconsistency in the standard of inquiry. These conflicting interpretations lead to forum shopping, uncertainty in execution law, and uneven protection of possessory rights. The lack of uniformity underscores the need for a clarificatory ruling by a larger Supreme Court bench or legislative refinement to harmonize procedural rights across jurisdictions. In Brahmdeo Choudhary v. Rishikesh Prasad Jaiswal (1997) 3 SCC 694, the Court held that even a person who is not a decree-holder or auction purchaser, like a third party facing dispossession, can approach the court for relief under this provision. However, in a later judgment, Sriram Housing Finance v. Omesh Misra Memorial Charitable Trust, the Court took a stricter view. It stated that only decree-holders or auction purchasers are allowed to use this legal route. Therefore, the case Brahmdeo Choudhary v. Rishikesh Prasad Jaiswal expanded the scope of Order XXI Rule 97 of CPC while the case of Sriram Housing Finance v. Omesh Misra Memorial Charitable Trust gave a strict textual interpretation of the same. In Brahmdeo Choudhary Case, the Supreme Court adopted a broad and purposive interpretation, affirming that a third party claiming independent possession or title, even if not a party to the original suit, has the right to resist execution under Rule 97 of CPC. The Court emphasized that the executing court must adjudicate all questions of right, title, or interest arising from such resistance within the execution proceedings, thereby promoting judicial economy and protecting bona fide possessors from wrongful dispossession. The Sriram Housing decision took a narrower view, holding that only the decree-holder or purchaser in execution can invoke Rule 97 of CPC, and that third parties must seek remedy through separate civil suits. [1]AIR 1998 SC 1827 [2] AIR 1997 SC 856 [3] 1980 SCC Online MP 44 [4]  AIR 1997 SC 856 [5] (1998) 4 SCC 543 [6] AIR 1997 SC 856 [7] AIR 1998 SC 1754 [8] (2022) 15 SCC 176 [9]Civil Appeal 3640-3642 of 2025 [10]2025 SCC OnLine Del 5725 [11]AIR 2024 Pat 111 [12] SCC Online Sikk 3 [13] AIR 1998 SC 1754 [14] AIR 1995 SC 358 [15] ILR 1954 Bom 950 [16] SCC Online Sikk 3 [17] SCC Online MP 36

A. Introduction In a landmark decision, the Supreme Court has sent a strong message that “the power to summon is not the power to interfere with the privileged communications between a lawyer and client, as long as the Constitutional Courts sit, in this Country[1].” The court was confronted with the rising tide of investigative adventurism, it stepped in as the ultimate sentinel of justice to recalibrate the uneasy balance between the might of the State and the independence of the Bar. The ruling reaffirms that professional communications are confidential and cannot be used as tools for investigation. It also introduces a system of judicial oversight and accountability for every summons, document request, or seizure of digital material. Through this judgment, the Court did more than settle a legal question — it reaffirmed that the freedom of the lawyer is the first bulwark of liberty, and that the edifice of justice stands tallest when the voice of counsel is fearless and unshackled. The judgment resonates far beyond questions of professional privilege; it is, in essence, a reaffirmation of the citizen’s fundamental right to fair legal representation and to consult a lawyer in confidence — rights flowing from Articles 19(1)(a), 20(3), and 21 of the Constitution. Considering the profound implications of this pronouncement for both the Bar and the citizenry, it becomes imperative to carefully understand the reasoning and impact of the judgment. B. Understanding attorney client privilege Before examining the issues framed and the conclusions reached by the Court, it becomes necessary to first outline the broader contours of the controversy to appreciate the context in which the judgment was rendered. The relationship between an advocate and client is one of the oldest and most revered fiduciary bonds known to law. An advocate, once engaged, ceases to be a mere professional adviser and becomes an extension of the client’s legal personality. This bond is founded upon absolute confidence — a client must be able to speak freely, without fear that their admissions or strategies could later become evidence against them. The concept of attorney–client privilege is not a modern innovation, but a cornerstone of civilized jurisprudence dating back several centuries. Its genesis can be traced to 16th century England, when the courts of chancery first recognized that an attorney could not be compelled to disclose the secrets of his client. The earliest reported instance appears in Berd v. Lovelace[2], where the Court of Chancery held that “the duty of the counsellor is to keep the secrets of his client,” marking the birth of what later came to be known as legal professional privilege. Over time, this doctrine evolved from a rule of evidence to an ethical commandment governing the conduct of lawyers. It came to symbolise the trust reposed by citizens in those who speak for them before the State and the courts. In India, this historic principle found statutory recognition in Sections 126 to 129 of the Indian Evidence Act, 1872, which codify the lawyer’s obligation to maintain confidentiality.  And now by Section 132, the said privilege, was retained in the  Bharatiya Sakshya Adhiniyam, 2023 (BSA), protecting the communications between a lawyer and a client as sacrosanct. However, the said section incorporates three limited circumstances when the privilege does not exists: when the client expressly consents; when the communication was made in furtherance of an illegal purpose; or when the lawyer observes a crime or fraud committed after commencement of professional engagement. In its judgment the Court described this confidentiality as not merely statutory, but constitutional in character, flowing from the client’s right to legal representation and his right against self-incrimination under Article 20(3). To compel a lawyer to reveal communications made in confidence, the Bench observed, would amount to compelling the client to testify against himself by proxy. C. Conflict between attorney client privilege and power of the investigating agency to compel witness Yet, in recent years, there has been a disquieting trend — a growing tendency of investigating agencies to summon advocates, seeking their appearance as witnesses or to elicit information regarding opinions rendered or advice given. The controversy reached its tipping point when a senior advocate was summoned by an investigating agency, triggering a national debate on the fragile boundary between the attorney–client privilege and the expansive powers of investigation. There was a rising concern that investigative agencies are adopting the easier route of summoning advocates rather than tracing the actual evidence. Such conduct is a dereliction of investigative duty and a distortion of criminal process. When enforcement officers summon advocates who have merely discharged their professional duty, they not only erode the client’s right to confidentiality but also send a chilling signal to the legal fraternity. It discourages candid consultation, inhibits fearless representation, and allows investigative authorities to adopt shortcuts instead of building evidence through lawful and diligent means. Such actions risk transforming the advocate — an officer of the court — into an unwilling witness for the prosecution. Anchored in this understanding that the strength of the criminal process lies in the separation of its functions, the Hon’ble Court proceeded to determine the delicate balance between investigative powers and the privilege of the legal profession. D. Issues before the Supreme Court The Court’s Suo Motu intervention was triggered aforesaid disturbing pattern, whereby investigating agencies, including the Enforcement Directorate (ED), had summoned practicing advocates for “knowing the true details” of their client’s case. The Supreme Court Bar Association (SCBA), Supreme Court Advocate on Record Association (SCAORA), and the Bar Council of India all intervened, arguing that such practice was an “unconscionable interference” with the right to practice the profession under Article 19(1)(g) and the right to life and liberty under Article 21. In its judgement the Court has dealt with the following issues: i. Whether an investigating agency or police can directly summon a lawyer for questioning when his only connection to the case is that he advised or represented a party in his professional capacity? ii. Whether there is any need for frame fresh “judicial guidelines” under Article 142 to regulate the summoning of advocates? iii. Whether an advocate can be compelled to produce documents or digital devices relating to a client’s case? iv. Whether the In-house counsels are not entitled to privilege under Section 132 of the BSA? E. Findings of the Supreme Court The Investigating Agency Cannot Summon an Advocate Merely for Discharging His Professional Duty The Supreme Court answered the first question with an emphatic and categorical “No.” The Bench declared that an investigating agency, prosecuting authority, or police officer cannot directly summon an advocate appearing in a case merely to elicit details concerning that case. Such an act, the Court observed, would amount to an impermissible intrusion into the sanctity of the attorney–client relationship. The finding of the Hon’ble Court is premised on, firstly, right to consult and be represented by an advocate of one’s choice, enshrined in Articles 21 and 22 of the Constitution, and would be rendered meaningless if the advocate could later be coerced into disclosing what transpired in confidence. Secondly, the Bar is not a “private guild” but a constitutional instrumentality. When an advocate is summoned for acts done in his professional capacity, the independence of the entire Bar is undermined. Where the Investigating Officer has specific, credible information bringing the matter within the limited statutory exceptions to privilege — for instance, communications in furtherance of an unlawful purpose or knowledge of a crime or fraud obtained after engagement — the summons must explicitly disclose the facts relied upon, so that the advocate concerned may avail the remedy of challenge under Section 528 of the Bharatiya Nagarik Suraksha Sanhita, 2023 (BNSS). Rejection of the Need for New Guidelines Sections 132 to 134 of BSA already provides a complete and time-tested code governing privileged communication between lawyer and client. The privilege had withstood the test of time in and remained a vital part of the justice delivery system. Therefore, it held that there existed no legislative vacuum warranting judicial intervention. Production of documents and digital devices The Court held that production of documents, per se, does not fall within the scope of Section 132 BSA, whether in a civil or criminal case. What is protected is the content of professional communications, not the mere act of producing a document. Consequently, both the Court and the Investigating Officer are empowered to seek production of documents under Section 94 BNSS. However, such production must be made only before the jurisdictional Court, which alone can determine the objections, privilege claims, and admissibility of those documents after hearing both the advocate and the client. Recognising the unique privacy risks posed by digital material, the Court laid down specific procedural directions for production of digital devices, which has been elaborated in the later part of this article. Status of In-house Counsel The Supreme Court held that an in-house counsel, being on the payroll of a corporation and bound by employment terms, functions as part of the organisation’s management structure rather than as an independent legal adviser representing a client before courts. The privilege under Section 132 of the BSA, therefore, cannot be invoked in relation to communications between an employer and its in-house counsel. However, the Court made an important qualification. It recognised that in-house counsels are still entitled to protection under Section 134 of the BSA, which safeguards legal advice given by legal advisers of a company. F. Directions by the Supreme Court The Court proceeded to lay down procedural safeguards designed to protect the interests of both advocates and their clients: Summoning of advocates Investigating Officers in criminal cases or Station House Officers conducting preliminary inquiries in cognisable offences shall not issue summons to an advocate representing an accused to elicit case details, unless the situation falls within one of the recognised exceptions under Section 132 of the BSA. If a summons is issued invoking any exception to privilege, it must clearly state the facts relied upon and bear the written approval of a superior officer not below the rank of Superintendent of Police, who must record his satisfaction in writing. Any summons so issued shall be open to judicial review at the instance of the advocate or the client under Section 528 of the Bharatiya Nagarik Suraksha Sanhita, 2023 (BNSS). Production of documents The documents can only be asked to be produced before the jurisdictional court and not the police. Upon production, the Court shall decide all objections regarding the order of production and admissibility of the document after hearing the advocate and the client. Production of digital devices Any direction by an Investigating Officer for production of a digital device must be only for production before the jurisdictional Court, not before the police. Upon production, the Court must issue notice to the client whose data is sought and hear both the client and the advocate on objections relating to production, discovery, or admissibility. If the Court overrules objections, the digital device shall be opened only in the presence of the advocate and client, who may seek assistance from a technical expert of their choice. The Court must ensure that confidential information relating to other clients stored on the device remains inviolable; only the material relevant to the particular investigation may be accessed or extracted. In-house Counsel The Court held that in-house counsels, being employees and not practising advocates, are excluded from Section 132 privilege, though they enjoy limited protection under Section 134 for communications received as legal advisers. [1] In Re: Summoning of Advocates Who Give Legal Opinion or Represent Parties During Investigation of Cases and Related Issues, 2025 INSC 1275. [2] (1577) 21 E.R. 33 Authored by Astha Sharma and Shreyas Awasthi.

Abstract Cryptocurrencies and digital assets are now embedded within the corporate balance sheets, investment portfolios, and individual wealth. Their pseudonymous decentralized, and borderless characteristics pose unique difficulties for insolvency practitioners tasked with asset tracing and recovery. This article examines the conceptual and practical challenges of tracing cryptocurrencies in insolvency proceedings, evaluates the legal status of such assets across jurisdictions, and explores judicial developments that shape recovery strategies. Imploring on judicial precedents, statutory guidelines, this article argues for the integration of blockchain analytics, international cooperation, and statutory reform to improve outcomes for creditors. I. Introduction The advent of cryptocurrency has ushered in a paradigm shift in global finance, often described as – ‘the dawn of decentralized era’. This has, in turn, posed novel challenges for the framework of insolvency proceedings. Unlike traditional insolvency practice, where professionals address tangible properties, securities, and bank deposits; digital assets are intangible, borderless and accessible solely through private cryptographic keys on decentralized ledgers. This fundamental difference raises complex questions regarding valuation, custody, and recovery in insolvency proceedings, challenging established legal doctrines and procedural framework. With the continuous expansion of digital assets, it becomes imperative to examine how insolvency laws must adapt to address the unique characteristics and risks posed by cryptocurrencies. The Insolvency and Bankruptcy Code, 2016 (‘IBC’) defines ‘property’ in broader terms but does not explicitly enumerate Virtual Digital Assets (‘VDA’) such as cryptoassets.[1] This lacuna has led to uncertainty: should cryptocurrencies be regarded as property capable of tracing and recovery, or merely as contractual rights lacking proprietary status? Addressing the same, in AA v Persons Unknown, the English High Court recognized that cryptocurrency constitutes property and may be subject to a proprietary injunction.[2] Likewise, the Singapore High Court in CLM v CLN, affirmed that cryptocurrencies qualify as property for the purpose of proprietary remedies.[3] The paradox of cryptoassets is that they are simultaneously transparent and opaque. On one hand, blockchains provide immutable public ledgers of transactions. On the other, pseudonymity and complex technologies make linking wallets to real-world debtors difficult. This duality complicates insolvency proceedings, challenging tracing, valuation and distribution of such assets. II. Taxed but not Tender: Legislative Intent on Recognition of Cryptocurrency The legal status of cryptocurrency in India reflects a cautious yet evolving regulatory approach. While cryptocurrencies are not yet recognized as legal tender, they are permitted to be bought, sold, and held as Virtual Digital Assets under the Income Tax Act, 1961. Judicially, the Supreme Court in Internet and Mobile Association of India v Reserve Bank of India,[4] set aside the RBI’s 2018 ban[5] on banking facilitation of cryptocurrency transactions, reaffirming constitutional freedom to trade in such assets. Subsequent legislative developments, including the proposed but unpassed Cryptocurrency and Regulation of Official Digital Currency Bill, 2021, highlighted the State’s intent to restrict private cryptocurrencies while exploring a central bank digital currency. However, with the Union Budget 2022, the government opted for a taxation regime instead – introducing a 1% TDS under Section 194S and a 30% tax on gains under Section 115BBH of the Income Tax Act – thereby acknowledging the legitimacy of crypto transactions as taxable events without according them the status of currency.[6] Parallelly, the regulatory framework has shifted towards compliance and monitoring. In March 2023, the Ministry of Finance issued a notification bringing VDA service providers within the definition of ‘reporting entities’ under section 2(1) (wa) of the Prevention of Money Laundering Act, 2002.[7] Consequently, exchanged and service providers are now required to register with the ‘Financial Intelligence Unit’ and adhere to ‘anti-money laundering’ obligations.[8] This has already resulted in 28 VDA platforms securing registration as reporting entities.[9] The combined effect of these measure reveals a legislative and regulatory trajectory that, while avoiding full recognition of cryptocurrency as money, positions it firmly within India’s taxation and compliance architecture. III. The Core Dilemma of Asset Tracing in Insolvency Tracing cryptoassets in insolvency proceedings poses significant challenges. Their anonymous nature, accompanied with privacy-enhancing tools, and rapid price volatility complicates the identification, recovery and valuation. Traditional approach used for bank accounts and other assets are often inadequate. The following sections examine the key issues: establishing ownership, navigating concealment strategies, and addressing valuation difficulties.   i. Identification of Ownership Establishing ownership of cryptoassets is a central challenge in insolvency proceedings given their anonymous nature and reliance on privacy tools. Courts across multiple jurisdictions have recognized cryptocurrencies as property, enabling proprietary remedies to recover misappropriated assets. As discussed earlier, in AA v Persons Unknown, the English High Court held that cryptocurrency qualifies as property and granted a proprietary injunction, emphasizing the importance of forensic evidence and tracing transactions. Similarly, in CLM v CLN, the Singaporean Court confirmed that cryptocurrencies constitute property under common law principles and allowed a worldwide freezing order against persons unknown. In addition to this, precedents such as Fetch.ai Ltd. v Persons Unknown[10] and Ion Science Ltd. v Persons Unknown[11]  further highlight the use of proprietary injunctions and third-party debt orders to identify wallet owners and recover assets. In Robertson v Persons Unknown[12] [2019] EWHC 358 (Comm) and D’Aloia v Persons Unknown[13] [2020] EWHC 1410 (Comm), the Court reinforced the need for disclosure orders compelling exchanges or intermediaries to reveal wallet ownership. These judgements collectively demonstrate that effective identification of cryptoasset ownership often relies on a combination of forensic blockchain analysis, information from cryptocurrency exchanges, and legal mechanisms like injunctions and disclosure orders. The accumulated jurisprudence establishes that while blockchain’s transparency aids tracing, the anonymous and decentralized nature of cryptoassets requires innovative legal tools and careful evidentiary strategies to connect digital wallets to their rightful owners in insolvency proceedings.   ii. Assets Concealment Strategies The corporate debtors indulge in exploiting various technological tools to frustrate tracing efforts in insolvency proceedings. Mixing services and tumblers, obscure the provenance of funds by pooling and redistributing cryptocurrency among various users, posing it difficult to trace the original source of assets. Privacy-focused cryptocurrencies complicate tracing due to their built-in features that conceal transaction details, including sender and receiver information. ‘Decentralized Exchanges’ (DEXs) without robust ‘anti-money laundering’ (‘AML’) mechanism and ‘Know Your Customer’ (‘KYC’) controls allow rapid and anonymous conversion, enabling debtors to move assets without detection. In response to these challenges, legal system across various jurisdictions have begun amending existing legal framework. In United States of America, the Department of Justice have charged individuals operating crypto mixers under ‘the Bank Secrecy Act’, emphasizing the need for compliance with AML regulations.[14] In addition, the blockchain analytics firms are developing advanced tools to detect and mitigate the risks associated with anonymous strategies, aiming to enhance the traceability of cryptoassets transactions. However, the evolving nature of these technologies presents ongoing challenges for the insolvency practitioners seeking to trace and recover assets effectively.   iii. Challenges in Valuation The valuation of cryptoassets poses significant challenges due to their volatility and the absence of standardized valuation methods. Thus, it makes imperative to ascertain whether the valuation of assets be at the date of commencement of insolvency proceeding, date of realization or date of distribution.  In the case of Mt. Gox Co. Ltd.[15], the Tokyo Court commenced bankruptcy proceedings in February 2024 following the disappearance of approximately 744,800 Bitcoins, valued around $ 473 millions. As of July 2022, approximately 142,000 Bitcoins were located, but the distribution process has been protracted and fraught with challenges. The creditors of the company received distributions based on the value of Bitcoin at the time of insolvency filing, not its later surge, thus causing significant inequity. In FTX Trading Ltd. v Vara,[16] the United States Bankruptcy Court issued a ruling in the FTX Chapter 11 of bankruptcy case, providing guidance on estimating the value of cryptocurrency claims. This decision marked a significant development in the legal treatment of cryptoassets under insolvency proceedings, establishing a framework that could influence future cases. These cases underscored the complexities and uncertainties associated with valuing cryptoassets in the regime of insolvency laws. The lack of established precedents and the volatile nature of cryptocurrencies necessitate careful consideration and innovative approaches by the insolvency practitioners to ensure fair and equitable treatment of creditors. IV. Property or Contractual Right? Why Classification Matters The legal classification of cryptoassets is not a mere academic exercise; it fundamentally determines the remedies available to creditors and insolvency practitioners. Accordingly, crypto being recognized as ‘property’, it opens the door to proprietary remedies – such as constructive trusts, tracing and injunctions – that offer stronger protection and recovery prospects. Conversely, if treated only as contractual rights, creditors are left as unsecured creditors with limited recovery. Thus, the classification debate goes to the heart of how law responds to cryptoassets insolvency.   i. The Property Debate The classification of cryptoassets as ‘property’ is pivotal: it enables remedial frameworks like constructive trusts, tracing, and proprietary injunctions, while a contractual-only characterization relegates creditors to unsecured claims with lower recovery priority. Jurisprudence established across other jurisdictions has largely settled this debate: for instance, in Ruscoe v Crytopia Ltd.,[17] the New Zealand High Court held that cryptocurrency indeed constitutes property. The Court applied the ‘four-part test’ from National Provincial Bank Ltd. v Ainsworth[18] – definability, identifiability by third parties, transferability, and permanence. Conversely, Indian jurisprudence has not yet ventured into this debate with clarity. In Internet and Mobile Association of India v Reserve Bank of India,[19] the Supreme Court invalidated the RBI’s ban on banking facilitation of cryptocurrency transactions on grounds of proportionality and protection of constitutional freedoms under Article 19(1)(g),[20] but deliberately sidestepped the question of whether cryptoassets are property under Indian laws. This omission leaves insolvency framework in India operating within an uncertain legal landscape, with no clear path to employing proprietary remedies for cryptoassets. ii. International Divergences The legal status of cryptoassets remains fragmented across jurisdiction, with courts adopting divergent approaches to classification. In the United States of America, bankruptcy courts have generally treated cryptocurrencies as part of the debtor’s estate under Section 541 of U.S. Bankruptcy Code.[21] Notably, in re Hashfast Technologies LLC,[22] the court recognized Bitcoin as property of the estate, thereby enabling the trustee to pursue avoidance and recovery actions in respect of crypto transfers. By contrast, China has displayed inconsistency. While certain decisions have treated cryptoassets as property entitled to legal protection – as in Li et al. v Liu (Stenzhen Intermediate People’s Court, 2019) – other rulings, following regulatory prohibitions, have emphasized that cryptocurrencies cannot function as legal tenders or tradable financial assets. This divergence underscores the absence of a settled global consensus. Whereas jurisdictions like the United States adopt a functional property analysis to safeguard creditor rights, China’s courts are constrained by regulatory bans, often relegating cryptoassets to a quasi-property status without full proprietary recognition. These differences highlight the risks of cross-border proceedings involving cryptoassets, where the remedies available to creditors may depend less on the nature of the assets than on the forum in which recover is sought. V. Policy and Legislative Reforms for the Digital Assets Era As comparative jurisprudence shows, jurisdictions that recognize cryptoassets as property have made meaningful strides in insolvency recovery. For India to avoid lagging behind, a coherent policy and legislative response must address disclosure, valuation and cross-border cooperation in digital asset cases.   i. Statutory Recognition and Disclosure Obligations The first and most pressing reform is to amend the Insolvency and Bankruptcy Code, 2016 to expressly recognize digital assets as ‘property’. Presently, the definition of property under Section 3(27) is broad,[23] but its silence on digital assets breeds uncertainty. Codifying cryptoassets as property would align Indian law with international standards and enable insolvency professionals to employ proprietary remedies such as tracing, freezing and constructive trusts. Debtors should be statutorily required to disclose all wallet addresses, holdings on centralized exchanges, and details of private key custodians. Failure to disclose should attract penalties akin to concealment of assets under existing insolvency laws. Such obligations would mirror disclosure standards in jurisdictions like the United States, where trustees can demand wallet information under Section 521 of 11 United States Code.[24] Without disclosure, the tracing mechanism remains speculative.   ii. Specialized Divisions and Cross-border Cooperation. Given the technical nature of digital assets, the legislatures should consider establishing specialized benches or expert panels within the NCLT/NCLAT. These divisions could be staffed with judicial members and technical experts in blockchain forensics, ensuring informed adjudication. This mirrors developments in other jurisdictions where specialized financial courts handle complex asset recovery cases. As crypto-transactions are inherently borderless, domestic reforms must be supplemented with international cooperation. India must adopt and adapt UNCITRAL’s Model Law on Cross-Border Insolvency,[25] which facilitates cooperation between courts of different jurisdictions. Enhanced use of ‘Mutual Legal Assistance Treaties’ (MLATs) and direct judicial communication channels will be critical in tracing assets across exchanges and jurisdictions.   iii. Infrastructural Capacity Finally, institutional capacity must be strengthened. Insolvency professionals, judicial members and regulators require training in blockchain technology, custody mechanisms, and forensic techniques. Investment and partnerships with forensic forms and academic institutions could create a sustainable ecosystem of expertise. Without this capacity, even the strongest statutory reforms risk under-enforcement. VI. Conclusion and Way Forward Tracing and recovering digital assets in insolvency represents one of the most pressing frontiers of modern commercial law. Foreign jurisdiction has begun to chart a path – recognizing cryptoassets as property, experimenting with proprietary remedies, and developing jurisprudence on valuation and recovery. India, by contrast, still grapples with statutory silence and limited judicial engagement, leaving insolvency professionals uncertain about the scope of their powers. The way forward lies in a multi-pronged strategy: legislative reform to expressly classify virtual digital assets as property under the Insolvency and Bankruptcy Code; procedural innovations such as mandatory disclosure of wallets and custodians; and institutional investment in technical expertise and cross-border cooperation. Embracing these measures, India can equip an insolvency regime that is both technologically attuned and creditor-protective-ensuring that digital assets are no longer insulated from accountability, but integrated into the fabric of commercial justice. [1] Section 3(27), Insolvency and Bankruptcy Code, 2016. [2] AA v Persons Unknown, [2019] EWHC 3556 (Comm). [3] CLM v CLN, [2022] SGHC 46. [4] Internet and Mobile Association of India v Reserve Bank of India, (2020) 10 SCC 274. [5] RBI’s Prohibition on dealing in Virtual Currencies, https://www.rbi.org.in/commanman/english/scripts/Notification.aspx?Id=2632. [6] Section 115BBH and 194S, Income Tax Act, 1961. [7] Section 2(1)(wa), Prevention of Money Laundering Act, 2002. [8] The Global Legal Post,  https://www.globallegalpost.com/lawoverborders/cryptoassets-1166537785/india-113459270?utm_source=chatgpt.com#4 [9] The Economic Times, Compliance of VDA Platforms to FIU-India https://economictimes.indiatimes.com/tech/technology/28-virtual-digital-assets-platforms-register-with-fiu-india-to-comply-with-pmla-norms/articleshow/105727721.cms [10] Fetch.ai Ltd. v Persons Unknown, [2021} EWHC 2254 (Comm). [11] Ion Science Ltd. v Persons Unknown, [2020] EWHC 290 (Comm). [12] Robertson v Persons Unknown, [2019] EWHC 358 (Comm). [13] D’Aloia v Persons Unknown, [2020} EWHC 1410 (Comm). [14] The Bank Secrecy Act, 31 USC 5311, United States of America. [15] In Re Mt. Gox Co. Ltd., 2014(Fu) No. 3830, Tokyo Bankruptcy Courts. [16] FTX Trading Ltd. v Vara, No. 23-2297 (3rd Cir. 2024), United States Bankruptcy Court. [17] Ruscoe v Crytopia Ltd., [2020] NZHC 728. [18] National Provincial Bank Ltd. v Ainsworth, [1965] AC 1175 (HL). [19] Internet and Mobile Association of India v Reserve Bank of India, (2020) 10 SCC 274. [20] Article 19(1)(g), Constitution of India, 1950. [21] Section 541, United States Bankruptcy Code (Tittle 11 of United State Codes). [22] In re Hashfast Technologies LLC, No. 14-30725 (Bankr.N.D.Cal.2016). [23] Section 3(27), Insolvency and Bankruptcy Code, 2016. [24] Section 521, United States Bankruptcy Code (Tittle 11 of United State Codes). [25] UNCITRAL’s Model Law on Cross Border Insolvency, 1997. Authored by Mr. Ketan Joshi, Senior Associate