BNS Section 318: Cheating

Offence

This section has been categorised into five subsections. Cheating can be a very broad term. Besides, not all forms of cheating are considered a criminal offence. Some of them may tend towards civil disputes also. So subsection 1 defines in detail what constitutes cheating for the purposes of this section. It provides detailed examples to highlight the various aspects and nuances of this offence. The remaining subsections detail the punishment for the various aspects of cheating. Let us take a look at these subsections one by one.

Subsection (1) defines cheating as any act of deceiving any person with fraudulent and dishonest intentions. For the purpose of this section, a dishonest act can be considered to be something that is done with the intention of making gains by causing undue or unjustified loss of property to someone else. It further establishes that such an act must be carried out with the purpose of inducing a person to:

deliver any property to any person - that is deceiving a person into delivering a property to someone.

consent that any person shall retain any property - that is deceiving a person into letting someone else continue to hold possession of a property.

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. In other words, deceiving a person to either commit an act or overlook the performance of an act with the intention that such oversight shall cause physical, mental, reputational damage or cause damage to any property owned by them

Any action intended to achieve such results shall be considered as cheating. It also provides an explanation saying that deception is not limited to lying or misleading. Intentionally concealing certain facts that could have avoided the damage or loss of property shall also be considered as deception for the purposes of this section. Let us take a look at the illustrations provided to understand this better.

(a) A, by falsely pretending to be in the Civil Service, intentionally deceives Z, and thus dishonestly induces Z to let him have on credit goods for which he does not mean to pay. A cheats.

Here A has deceived Z into believing that he is an officer of the Civil service. However, for it to be a criminal offence, Z has to suffer an undue loss of property. Here, by convincing Z that he is in the civil service, A has secured a line of credit from Z without any intention of honouring the payment for the goods. So when Z delivers the goods to A, he has suffered a loss of property as he is not likely to receive payment for the same. Hence, A has committed an act of cheating.

(b) A, by putting a counterfeit mark on an article, intentionally deceives Z into a belief that this article was made by a certain celebrated manufacturer, and thus dishonestly induces Z to buy and pay for the article. A cheats.

A has committed deception by convincing Z that the item is made by a particular manufacturer when in reality it has not. And when Z pays the premium price for an item which is not what he thinks it is, he suffers loss of property as he has not been delivered the actual item for which he has paid the price. Z has been cheated by A.

(c) A, by exhibiting to Z a false sample of an article intentionally deceives Z into believing that the article corresponds with the sample, and thereby dishonestly induces Z to buy and pay for the article. A cheats.

Here A has deceived Z by delivering him an item which is different from the sample that had been approved by him. A had shown the sample promising to deliver the same thing for a price. However, in reality he has delivered something else which may not be worth the same value as what had been estimated based on the sample. So Z has paid more than what should be for the item. Hence, Z has suffered loss of property and has, hence, been cheated.

(d) A, by tendering in payment for an article a bill on a house with which A keeps no money, and by which A expects that the bill will be dishonoured, intentionally deceives Z, and thereby dishonestly induces Z to deliver the article, intending not to pay for it. A cheats.

A has deceived Z by giving him a bill which he knows is not realisable and has no value. And since the bill was given in lieu of payment for an article, Z has suffered loss of property as he is unlikely to recover the price of the article which has been delivered to A in exchange for the bill.

(e)A, by pledging as diamonds articles which he knows are not diamonds, intentionally deceives Z, and thereby dishonestly induces Z to lend money. A cheats.

A has deceived Z by convincing him that fake diamonds are real. Z suffers loss of property because he lends money to A with the fake diamonds as collateral. A has suffered loss of property because he is unlikely to recover that money either from A or from the false diamonds supplied by A as collateral.

(f) A intentionally deceives Z into a belief that A means to repay any money that Z may lend to him and thereby dishonestly induces Z to lend him money, A not intending to repay it. A cheats.

A has deceived Z here because he falsely convinces Z into believing that he is credit worthy even though he has no intention of honouring any credit given to him by Z at the time of making such promises. Any money that Z lends to A will not be recovered hence causing loss of property, which amounts to cheating.

(g) A intentionally deceives Z into a belief that A means to deliver to Z a certain quantity of indigo plant which he does not intend to deliver, and thereby dishonestly induces Z to advance money upon the faith of such delivery. A cheats; but if A, at the time of obtaining the money, intends to deliver the indigo plant, and afterwards breaks his contract and does not deliver it, he does not cheat, but is liable only to a civil action for breach of contract.

This illustration clearly demonstrates how deception and dishonest intention are extremely critical in determining whether a particular action amounts to cheating or not. Here, in both cases, the end result is the same. A promises to deliver a certain quantity of indigo to Z, takes an advance for it and fails to deliver the same. So there has certainly been a loss of property. However, A’s intention at the time of making the promise is what determines whether this was a case of cheating or simple breach of contract. If A had intended to deliver the indigo at the time of making the promise and taking the advance, but failed to deliver due to circumstantial reasons, then it is a breach of contract and is a civil matter. But if A had no intention of honouring the delivery at the time of making the promise and had purely made the promise to extract money from Z in the form of an advance, then it amounts to cheating and is a criminal matter.

(h) A intentionally deceives Z into a belief that A has performed A’s part of a contract made with Z, which he has not performed, and thereby dishonestly induces Z to pay money. A cheats.

A has deceived Z into believing that the work has been done. And the payment made by Z on believing A’s words has caused him loss of money. So A has cheated Z.

(i) A sells and conveys an estate to B. A, knowing that in consequence of such sale he has no right to the property, sells or mortgages the same to Z, without disclosing the fact of the previous sale and conveyance to B, and receives the purchase or mortgage money from Z. A cheats.

The moment A has sold the property to B, he loses all rights and privileges he holds over the property. By convincing Z that he still has the right to sell the property, he has performed deception. And by taking money by selling a property he doesn’t own, A has caused loss of money to Z, thereby committing an act of cheating.

The remaining subsections define the punishment for the various aspects of cheating. Let us take a look.

Subsection (2) defines the punishment for committing an act of cheating.

Subsection (3) defines the punishment for cheating a person whose interests were supposed to be protected by the person who has committed the act of cheating. For instance, a person has been appointed as a legal guardian for a minor to manage the estate and the well being of the child. This creates a legal obligation for the guardian when it comes to protecting the interests of the minor. If such a person takes advantage of his position and cheats the minor, he or she shall be punishable under this subsection.

Subsection (4) defines the punishment for committing an act of cheating involving valuable items or property.

Punishment

Any person found guilty of cheating shall be punished with imprisonment for a term which may extend to three years, or with fine, or with both.

Any person found guilty of cheating a person they are legally obligated to protect shall be punished with imprisonment for a term which may extend to five years, or with fine, or with both.

Any person found guilty of committing an act of cheating involving valuable property or items shall be punished with imprisonment for a term which may extend to seven years, and shall also be liable to fine.

The above actions may not be an offence under this section if:

However, there may be other sections under the BNS under which the above actions can be prosecuted and while they may be disqualified under the provisions of this section, such actions will still be punishable under the provisions of those respective sections of the BNS.