Difference between fraud and cheating under IPC

The basic difference between fraud and cheating is that Cheating is mere a Collective offense for Cheating & Fraud. The difference between them lies in their scope.  Cheating is described under Section 415  and Implications of fraud are found u/s sections 421,422,423 and 424 of IPC.

The legal definition of Fraud is “A false representation of a matter of fact whether by words or by conduct, by false or misleading allegations, or by concealment of what should have been disclosed that deceives and is intended to deceive another so that the individual will act upon it to her or his legal injury.

Section 415 in The Indian Penal Code

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”.

Explanation.—A dishonest concealment of facts is a deception within the meaning of this section. 

Illustrations

(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.

(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.

(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.

(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 dishonored, intentionally deceives Z, and thereby dishonestly induces Z to deliver the article, intending not to pay for it. A cheats.

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

(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.

(g) An 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.

(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.

(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.

Section 25 in The Indian Penal Code

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

Implications of fraud are found in these following sections of IPC namely, 421,422,423 and 424.

Section 421: Dishonest or fraudulent removal or concealment of property to prevent distribution among creditors.

Whoever dishonestly or fraudulently removes, conceals or delivers to any person, or transfer or causes to be transferred to any person, without adequate consideration, any property, intending thereby to pre­vent, or knowing it to be likely that he will thereby prevent, the distribution of that property according to law among his creditors or the creditors of any other person, shall be punished with imprisonment of either des c r i p tion for a term which may extend to two years, or with fine, or with both

Section 422: Dishonestly or fraudulently preventing debt being available for creditors. Whoever dishonestly or fraudulently prevents any debt or demand due to himself or to any other person from being made available according to law for payment of his debts or the debts of such other person, shall be punished with imprisonment of either des c r i p tion for a term which may extend to two years, or with fine, or with both.

Section 423: Dishonest or fraudulent execution of the deed of transfer con­taining false statement of consideration.

Whoever dishonestly or fraudulently signs, executes or becomes a party to any deed or instrument which purports to transfer or subject to any charge any property, or any interest therein, and which contains any false statement relating to the consideration for such transfer or charge, or relating to the person or persons for whose use or benefit it is really intended to operate, shall be punished with imprisonment of either des c r i p tion for a term which may extend to two years, or with fine, or with both.

Section 424: Dishonest or fraudulent removal or concealment of property.

Whoever dishonestly or fraudulently conceals or removes any property of himself or any other person, or dishonestly or fraud­ulently assists in the concealment or removal thereof, or dishon­estly releases any demand or claim to which he is entitled, shall be punished with imprisonment of either des c r i p tion for a term which may extend to two years, or with fine, or with both.

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