Source: Supreme Court

Why in News?

Recently, the Supreme Court in the matter of A.M. Mohan v. The State has held that for attracting the provisions of Section 420 of the Indian Penal Code, 1860 (IPC) it must be shown that the person who cheated was dishonestly induced to deliver the property to any person.

What was the Background of A.M. Mohan v. The State Case?

• In this case, the complainant transferred a certain amount of money to the present appellant upon the insistence of another accused, no. 2, who was also the complainant's college friend.
• Apart from this, it was also alleged that accused no. 1 and 2 had duped the complainant by a heavy sum.
• The accused persons swindled all the amounts and cheated the complainant.
• An FIR was registered against accused no. 1 and 2 for the offence punishable under Section 420 of IPC. In this, the appellant was also roped in.
• Thereafter, the appellant filed a petition before the High Court of Madras for quashing of the FIR.
• The High Court rejected the petition.
• Thereafter, an appeal was filed before the Supreme Court which was later allowed by the Court.

What were the Court’s Observations?

• The Bench comprising of Justices B.R Gavai, Rajesh Bindal and Sandeep Mehta observed that for attracting the provisions of Section 420 of IPC, it must be shown that the complaint discloses:
  • The deception of any person.
  • Fraudulently or dishonestly inducing that person to deliver any property to any person.
  • Dishonest intention of the accused at the time of making the inducement.
• It was further held that in that view of the matter, the charge sheet, even if taken at its face value, does not disclose the ingredients to attract the provision of Section 420 of IPC qua the appellant.

What is Section 420 of IPC?

About:

• This Section deals with cheating and dishonestly inducing delivery of property whereas the same provision has been covered under Section 318 of the Bhartiya Nyaya Sanhita, 2023(BNS).
• It states that whoever cheats and thereby dishonestly induces the person deceived to deliver any property to any person, or to make, alter or destroy the whole or any part of a valuable security, or anything which is signed or sealed, and which is capable of being converted into a valuable security, shall be punished with imprisonment of either description for a term which may extend to seven years, and shall also be liable to fine.

Essential Elements:

• The essential elements to constitute an offence under Section 420 of IPC are as follows:
  • A person must commit the offence of cheating under Section 415 of IPC.
  • The person cheated must be dishonestly induced to
    • Deliver property to any person; or
    • Make, alter or destroy valuable security or anything signed or sealed and capable of being converted into valuable security.
  • Cheating is an essential ingredient for an act to constitute an offence under Section 420 of IPC.

Cheating:

• Section 415 of IPC deals with the offence of cheating.
• It states that 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.