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Cheating (IPC)

Updated: May 13


Cheating (IPC)
Cheating (IPC)

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Sec. 415: Cheating


“Whoever, by deceiving any person, fraudulently or dishonestly induces the person so deceived to deliver any property to any person, or to consent that any person shall retain any property, or intentionally induces the person so deceived to do or omit to do anything which he would not do or omit if he were not so deceived, and which act or omission causes or is likely to cause damage or harm to that person in body, mind, reputation or property, is said to cheat.”



Essential Ingredients of Cheating


Cheating involves fraudulently or dishonestly inducing someone to deliver property, or causing harm by intentional inducement. This harm can be to body and mind, reputation, or property. In English law, dishonestly obtaining property with the intent to permanently deprive the owner is considered theft, but this intent isn't required under Indian law.



  • Deception - Deception lies at the core of cheating, involving causing someone to believe falsehoods or leading them into error. It encompasses wilful misrepresentation through words or conduct to mislead another. The misrepresentation must be knowingly false and made with the intent to deceive. Innocent statements about the future do not constitute deception.



Deception must occur before the delivery of property, and dishonest intention at the outset of the transaction is crucial.


The fraudulent representation can be direct or indirect, such as through an agent. Mere deceit of a person is insufficient; it must induce the person deceived to deliver property or cause harm to them.



The fact that the fraud could have been detected does not negate the charge of deception. However, if the victim discovers the deception but still suffers harm, they have no basis for complaint.


Even if suspicions arise, if the victim still acts upon the deception to their detriment, the offence of cheating can still be established.



In some cases, cheating may involve a third party sustaining a financial loss due to the accused's actions, even if they were not directly deceived. Attempting to cheat is also punishable, even if the intended victim is forewarned.

 
 

However, if the victim knows the falsehood of the pretence and still acts upon it, the accused may not be convicted of cheating, but they may be held liable for attempt to cheat.



  • Puffing of goods - Puffing of goods, or mere exaggeration or praise of goods for sale, is not considered cheating. However, if the goods sold are significantly different from what was represented, and the statements made are knowingly false regarding specific facts, it constitutes cheating. For instance, selling a gold chain claimed to be 15-carat when it's actually 6-carat would be considered cheating. 



In cases where the accused falsely represents themselves, such as pretending to be a police officer to deceive and blackmail someone, it constitutes deception and cheating.


Similarly, obtaining payments on money orders through false identity documents amounts to cheating and forgery.


Actions like dining at a hotel without paying the bill or selling milk diluted with water as pure milk are also considered cheating. Similarly, failing to repair or return utensils entrusted for repair constitutes trickery and cheating.


If someone obtains a loan by falsely claiming to be a major, then later claims to be a minor to avoid repayment, they can be convicted of cheating. This is because their intention to deceive was dishonest from the outset.



  • Fraudulent or dishonest intention - Sec. 415 of the Indian Penal Code stipulates that cheating involves both deceiving and inducing another person with the intention to cause wrongful gain or loss. While a recommendation of worthiness doesn't constitute false representation, exaggerating consequences without fraudulent intent isn't considered cheating either.



Cheating requires a dishonest and fraudulent intent, inducing the victim into a bargain they wouldn't enter if they knew the truth. Failure to pay for goods upon delivery, without intent to cheat, doesn't constitute cheating. For an offence under Sec. 420, establishing the accused's criminal intention at the time of the offence is crucial. In contractual transactions where deception occurs, the intention may be lacking at the time of the transaction.



  • Any property - The term 'property' in Sec. 415 encompasses both movable and immovable assets, extending to documents like passports or admit cards. Cheating requires inducing a person, through deception, to part with property or act in a way detrimental to their interests. For instance, inducing someone into sexual intercourse through misrepresentation may constitute cheating.



However, consent to premarital intercourse may not be considered cheating unless it's proven that the accused never intended to marry. Dishonestly inducing sexual intercourse based on false promises of marriage is an offence under Sec. 415. Actions like entering an exhibition without a ticket or evading railway fare generally do not amount to cheating unless deception is involved.



Preparing to cheat, such as obtaining thumb impressions on blank paper, may not constitute cheating until the document is filled out. Similarly, falsely claiming qualifications on signage or letterheads is considered an attempt to cheat. Procuring licences or infringing trademarks through deceitful means can constitute cheating. Dishonest issuance of a bounced cheque may also amount to cheating under the English law.



  • Causes or is likely to cause damage or harm in body, mind, reputation or property - The resulting damage or likelihood of damage need not have been in the accused's actual contemplation during the deceit, but the person deceived must have acted under its influence. Harm should be directly caused to the deceived individual, not to anyone else.



Instances such as falsely representing one's caste to arrange a marriage or introducing fake proposals to inflate business figures can constitute cheating, even without the delivery of property. In cases like these, harm is inflicted on the victim's body, mind, reputation, or property.


Acts like forging letters of invitation or selling property one doesn't own can be considered fraudulent and prosecuted under Sec. 415. However, mere introduction to a bank for opening an account, without any connection to subsequent fraud, does not constitute cheating.




Cheating by Personation (Secs. 416,419)


Sec. 416: Cheating by Personation

"Cheating by personation" occurs when someone deceives others by pretending to be someone else, whether real or imaginary, through words, actions, signs, or attire. This offence encompasses various scenarios, such as falsely representing one's caste, marital status, or eligibility to vote. The deception must result in gain or loss for either party involved.



For example, if an individual impersonates another person at a university examination, obtains a hall ticket under their name, and writes papers on their behalf, it constitutes cheating by personation. Similarly, if someone falsely claims to be single and induces another to marry them, while actually being married, it falls under this offence.



Securing appointments through fake letters or by posing as a minister's relative also constitutes cheating by personation. In one case, an individual posed as a scheduled caste candidate to secure a government position, leading to their conviction for cheating by personation under Sec. 416, IPC.



Sec. 419. Punishment for cheating by personation - 

Whoever cheats by personation shall be punished with imprisonment up to 3 years, or fine, or with both.

 
 

Cheating Out of Fiduciary Relation (Sec. 418) 


Section 418 addresses cheating when the offender, in a position of trust like a banker, agent, guardian, or company director, knowingly causes wrongful loss to someone they are obligated to protect by law or contract. It's an aggravated form of cheating, focusing on the abuse of trust.



For instance, a director presenting a false balance sheet to shareholders to conceal the true state of a company's finances is liable under this section. Similarly, misrepresentation to secure deposits for a company constitutes an offence under Sec. 418.



Intent is crucial; without an intent to deceive, the offence of cheating cannot be established. In a case where a bank couldn't rent a property due to unforeseen circumstances, it was ruled that the bank wasn't liable for cheating as there was no intent to deceive the landlord.



Cheating Involving Delivery of Property (Sec. 420)


Sec. 420: Cheating and Dishonestly Inducing Delivery of Property

Section 420 addresses cases where dishonest inducement results in the delivery of property, alteration or destruction of valuable securities, or similar acts. It distinguishes from Section 415 by focusing on instances where property is actually transferred due to the deception. The punishment under Section 420 is more severe, with up to 7 years of imprisonment.



Intent plays a crucial role; if there's no intent to cheat, the offence cannot be established. Even if there's no monetary loss, the accused can still be held liable. For instance, obtaining or producing a fake document to evade taxes constitutes cheating under Section 420.


The offence is complete once property is delivered due to the deception, irrespective of later actions like repayment. Switching off air-conditioning after selling tickets for an air-conditioned theatre is deemed cheating, as customers are induced to purchase tickets under false pretences.


However, violating hire purchase agreements generally doesn't amount to cheating unless there was dishonest intention from the outset. Similarly, inducing someone to hand over property with false promises can constitute cheating, as seen in cases where dealership promises were not fulfilled.



Intent must be proven; for instance, bank officials granting facilities without criminal intent aren't liable. False claims for government payments constitute cheating under Section 420, not Section 417.


Transactions on credit basis typically don't fulfil the elements of cheating under Section 420. Attempts to cheat, like falsely claiming qualifications, also fall under this section, as seen in cases of forged educational certificates submitted for examinations.

 
 

Distinction between 'Breach of contract" and 'Cheating’


  1. Case: MAHADEO PRASAD v STATE OF WEST BENGAL  (AIR 1954 SC 724) - In determining whether a person is guilty of cheating, the crucial factor is establishing fraudulent or dishonest intention at the time of making a promise. Mere failure to honour a promise doesn't necessarily amount to cheating; deception is key. If the promisor genuinely intended to fulfil their promise, the situation may only constitute a breach of contract, not a criminal offence.



For instance, in a case where a person agreed to purchase goods but failed to pay, the court upheld the conviction for cheating because evidence showed the buyer had no intention to pay from the outset, using false promises to obtain the goods.



The distinction between breach of contract and cheating lies in the presence of fraudulent intent at the beginning of the transaction. Mere breach of contract isn't enough for criminal prosecution unless there's evidence of dishonesty or fraud from the outset.



Cases like obtaining commodities for one purpose and using them for another without fraudulent intent or failure to comply with certain conditions unintentionally don't constitute cheating. Similarly, where there's no intentional deception in advertising investment schemes, it may not amount to cheating.



In summary, the line between breach of contract and cheating hinges on proving fraudulent or dishonest intent at the inception of the transaction, distinguishing cases where civil action suffices from those warranting criminal prosecution.



Advertisement whether amount to Cheating 


  1. Case: AKHIL KISHORE RAM V EMPEROR  (AIR 1938 Pat 185) - The appellant advertised charms and incantations promising desired results with minimal effort, offering a cash prize if unsuccessful. However, specific conditions, like gazing at the moon without blinking, were only revealed after purchase.



Issue - Is the appellant guilty of cheating based on the advertisement's misleading nature?

Decision - The court rejected claims of good faith, noting the appellant's desire for personal gain. Conditions like secrecy aimed to maintain a monopoly, contradicting the advertised ease of use. The appellant's intention to exploit human nature for profit was evident.



False Representation of Divine Powers amounts to Cheating 


  1. Case: SHRI BHAGWAN S.S.V.V. VISHWANDADHA MAHARAJ v. STATE OF A.P. (AIR 1999 SC 2332) - In this case, the accused claimed to possess divine healing powers, offering to treat the complainant's daughter's congenital dumbness for a fee of Rs. one lac. Despite payment, there was no improvement in the girl's condition. Upon hearing of similar fraudulent activities by the accused, the complainant realised the deception and filed a complaint for cheating.



The Supreme Court ruled that representing oneself as possessing divine powers to induce others into believing in them constitutes fraud. Responding to such inducement and providing money without receiving the promised result qualifies as cheating under Sections 415 and 420 of the IPC.

 
 

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