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Meaning of 'Fraudulently'

Section 25 of the Indian Penal Code, 1860.

A person is said to do a thing fraudulently if he does that thing with intent to defraud but not otherwise.

The word ‘fraudulently’ is not confined to transactions of which deprivation of property forms a part. The intention with which an act is done is very important in determining whether the act is done ‘dishonestly’ or ‘fraudulently.’

Where an offence depends upon proof of intention the Court must have proof of facts sufficient to justify it in coming to the conclusion that the intention existed. No doubt one has usually to infer intention form conduct, and one matter that has to be taken into account is the probable effect of the conduct. But that is never conclusive.

Fraud and Forgery: Where there is an intention to deceive and to obtain an advantage by means of the deceit, there is fraud and if a document is fabricated with that intent, it is forgery.

Intent to defraud

The terms “fraud’ and ‘defraud’ are not defined in the Penal Code. The word ‘defraud’ is of double meaning in the sense that it either may or may not imply deprivation, and, as it is not defined, its meaning must be sought by a consideration of the context in which the word ‘fraudulently’ is found. Sir James Stephen observes : Whenever the words ‘fraud’ or ‘intent to defraud’ or ‘fraudulently’ occur in the definition of a crime two elements at least are essential to the commission of the crime; namely, first, deceit or an intention to deceive or in some cases mere secrecy; and, secondly, either actual injury or possible injury or an intent to expose some person either to actual injury or to a risk of possible injury by means of that deceit or secrecy. This intent, I may add, is very seldom the only or the principal intention entertained by the fraudulent person, whose principal object in nearly every case is his own advantage. The injurious deception is usually intended only as a means to an end, though this, as I have already explained, does not prevent if from being intentional… A practically conclusive test as to the fraudulent character of a deception for criminal purpose is this: Did the author of the deceit derive any advantage from it which he could not have had if the truth had been known? If so, it is hardly possible that, that advantage should not have had an equivalent in loss, or risk of loss, to someone else; and if so, there was fraud. In practice people hardly ever intentionally deceive each other in matters of business for a purpose which is not fraudulent.

Defrauding involves two conceptions, namely, deceit and injury (i.e., infringement of some legal right) to the person deceived. Where there is an intention to deceive and by means of deceit to obtain an advantage there is fraud. The intention to deceive may be from any expectation of advantage to the party himself, or from ill-will towards the other.

A general intention to defraud, without the intention of causing wrongful gain to one person or wrongful loss to another, is sufficient to support a conviction. In order to prove an intent to defraud, it is not at all necessary that there should have been some person defrauded, or who might possibly have been defrauded. A man may have an intent to defraud, and yet there may not be any person who could be defrauded by his act. Suppose a person with a good account at his bankers, and a friend, with his knowledge, forges his name to a cheque either to try his credit, or to imitate his handwriting, there would be no intent to defraud, though there would be parties who might be defrauded; but where another person has no account at his bankers, but a man supposes that he has, and on that supposition forges his name, there would be an intent to defraud in that case, although no person could be defrauded.

The accused in order to obtain recognition from a Settlement Officer that they were entitled to the title of “Loskur” filed a sunnad before that officer purporting to grant that title. This document was found not to he genuine and they were convicted under ss. 471 and 464. It was held that they could not be found guilty as their intention was not to cause wrongful gain or wrongful loss to anyone, but to produce a false belief in the mind of the Settlement Officer that they were entitled to the dignity of “Loskur”, and that this could not be said to constitute an intention to defraud.1)

Where the accused, after the execution and registration of a document, which was not required by law to he attested, added his name to the document as an attesting witness, it was held that his act was neither fraudulent nor dishonest and the accused was, therefore, not guilty of forgery.2)

Fraudulently and dishonestly

There is a real distinction between the meanings of the terms ‘fraudulently’ and ‘dishonestly’; the former denotes an intent to deceive. The production of a forged bond by a person in a suit with the intent to make the Court believe that he was entitled to recover money upon the basis of the particular document produced, though it may not be dishonest within the meaning of s. 24, may yet be fraudulent within the meaning of s. 471.

The difference between an act done dishonestly and an act done fraudulently is that if there is the intention by the deceit practised to cause wrongful loss that is dishonesty, but even in the absence of such an intention, if the deceitful act wilfully exposes anyone to risk of loss, there is fraud.

Case Laws

A, desiring to appear at an examination in order to qualify as an engineer on ocean-going steamers presented a false testimonial, of service and good character, such a testimonial being a condition precedent to appearance at the examination. It was held that he acted 'fraudulently' and was guilty of forgery.3) Similarly the use of a forged document of title in an action4), or of forged letter of recommendation for a vacant post5) are both fraudulent, but not the fabrication of receipts in lieu of lost genuine ones.6)

A presented to B, the principal of a college, a false certificate purporting to have been signed by C, the principal of another college, to the effect that he A had attended a course of law lectures for one year in C's college. Thereby A obtained admission into the second year law class in B's college, without paying the fee for the first year course. At the end of the year A again presented the false certificate to B, in order to obtain a consolidated certificate for the two years. Held, that A acted 'dishonestly', since he caused wrongful gain to himself of the first year course fee, and wrongful loss to the college thereof; and that he also acted 'fraudulently', since he intended to deceive B, and obtain admission to the second year class in consequence thereof.7)

Jan Mahomed, (1884) 10 Cal. 584
Surendra Nath Ghosh, (1910) 14 Cal. 477
R v Abbas Ali, 25 ILR Cal 512
R v Dhunum Kazee, 9 ILR Cal 58
Abdul Hamid v R, 13 ILR Cal 349
R v Sheo Dayal 7 ILR All 459 ; R v Syed Husain 7 ILR All 403
R v Sosi Bhushan, 15 ILR All 210

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