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Law of Crimes II

Of

OFFENCES

RELATING TO

CURRENCY-NOTES

AND

BANK-NOTES

PROJECT WORK SUBMITTED FOR INTERNAL

ASSESSMENT
Prior to 1899, the offences relating to currency
notes and bank notes were governed by the provisions dealing
with forgery of valuable securities (s. 467) and making or
possessing counterfeit currency seals, plates (s. 472). These
sections proved less effective for securing convictions for
counterfeiting or possessing counterfeit currency notes as well as
for making or possessing instruments for counterfeiting currency
notes.
In order to protect the currency notes and bank notes from
forgery sections 489 A to 489 D were added to the IPC by the
Currency Notes Forgery Act 1899 and section 489 E was added to
the IPC by the Indian Penal Code (Amendment) Act 1943, for
prohibiting and penalizing the acts of bringing in circulation
photo-prints or otherwise printed or reproduced or imitated
currency-notes or bank-notes.
The s. 28 of IPC defines Counterfeiting as an act which causes one
thing to resemble another, intending by means of that
resemblance to deceive.
The three conditions that are required as mentioned under this
definition are:
i. Causing one thing to resemble another;
ii. Intending by means of that resemblance to cause deception,
and
iii. Knowing it to be likely that deception will be thereby
practiced.
The Supreme Court, in M. Mammutti v. State of Karnataka,
emphasised that the basic test to prove counterfeit currency is to
see whether even an ordinary person would by a mere glance be
fooled by the note fraudulently made.

Scope of sections 489 A to 489 E

The sections 489 A to 489 E in the IPC are arranged on the


following basis:

1. S. 489 A describes the offence of Counterfeiting currency-


notes and bank-notes (imprisonment for life or imprisonment
for 10 years and fine)
2. S. 489 B deals with selling, buying or using as genuine,
forged or counterfeit currency-notes or bank-notes, knowing
the same to be forged or counterfeit (imprisonment for 10
years and fine)
3. S. 489 C deals with possession of forged or counterfeit
currency-notes or bank-notes, knowing or having reason to
believe the same to be forged or counterfeit and intending to
use the same as genuine (imprisonment for 7 years or fine or
both)
4. S. 489 D deals with the making or possessing instruments or
materials for forging or counterfeiting currency-notes or
bank-notes (imprisonment for life or imprisonment for 10
years and fine)
5.
i. Making or using documents resembling currency-notes
or bank-notes (fine up to Rs. 100).
ii. Refusal by the person whose name appears on a
document to disclose to a police officer, the name and
address of the person by whom the document was
printed or otherwise made (fine up to Rs. 200).
In State of Kerala v. Mathai verghese, the Supreme Court
held that the counterfeiting of currency-notes not only of
India but of foreign countries as well, constitute offence
under s. 489 A, IPC. The expression currency-note in s. 489,
IPC is wide enough to embrace currency notes issued by
India as also those issued by any other country in the world.

Sections relating to the offence


under the Indian Penal Code

489A. Counterfeiting currency-notes or bank-notes

Whoever counterfeits, or knowingly performs any part of the


process of counterfeiting, any currency-note or bank, note, shall
be punished with [imprisonment for life], or with imprisonment of
either description for a term which may extend to ten years, and
shall also be liable to fine.

Explanation: For the purpose of this section and of sections 489B,


[489C, 489D and 489E], the expression bank-note, means a
promissory note or engagement for the payment of money to
bearer on demand issued by any person carrying on the business
of banking in any part of the world, or issued by or under the
authority of any State or Sovereign Power, and intended to be
used as equivalent to, or as a substitute for money.

CLASSIFICATION OF OFFENCE

Punishment - Imprisonment for life or imprisonment for a term of


10 years and fine

Cognizable, Non-bailable and Triable by Court of Session, Non-


compoundable

489B. Using as genuine, forged or counterfeit currency-


notes or bank-notes

Whoever sells to, or buys or receives from, any other person, or


otherwise traffics in or uses as genuine, any forged or counterfeit
currency-note or bank-note, knowing or having reason to believe
the same to be forged or counterfeit, shall be punished with
[imprisonment for life], or with imprisonment of either description
for a term which may extend to ten years, and shall also be liable
to fine.

CLASSIFICATION OF OFFENCE

Punishment - Imprisonment for life or imprisonment for a term of


10 years and fine

Cognizable, Non-bailable and Triable by Court of Session, Non-


compoundable

489C. Possession of forged or counterfeit currency-notes


or bank-notes

Whoever has in his possession any forged or counterfeit currency-


note or bank-note, knowing or having reason to believe the same
to be forged or counterfeit and intending to use the same as
genuine or that it may be used as genuine, shall be punished with
imprisonment of either description for a term which may extend
to seven years, or with fine, or with both.

CLASSIFICATION OF OFFENCE

Punishment - Imprisonment for a term of 7 years, or fine, or both

Cognizable, Bailable and Triable by Court of Session, Non-


compoundable
489D. Making or possession instruments or materials for
forging or counterfeiting currency-notes or bank-notes

Whoever makes, or performs, any part of the process of making,


or buys or sells or disposes of, or has in his possession, any
machinery, instrument or material for the purpose of being used,
or knowing or having reason to believe that it is intended to be
used, for forging or counterfeiting any currency-note or bank-
note, shall be punished with [imprisonment for life], or with
imprisonment of either description for a term which may extend
to ten years, and shall also be liable to fine.

CLASSIFICATION OF OFFENCE

Punishment - Imprisonment for life or imprisonment for a term of


10 years and fine

Cognizable, Non-bailable and Triable by Court of Session, Non-


compoundable

489E. Making or using documents resembling currency-


notes or bank-notes

(1) Whoever makes, or causes to be made, or uses for any


purpose whatsoever, or delivers to any person, any document
purporting to be, or in any way resembling, or so nearly
resembling as to be calculated to deceive any currency-note or
bank-note shall be punished with fine which may extend to one
hundred rupees.

(2) If any person, whose name appears on a document the


making of which is an offence under sub-section (1). Refuses,
without lawful excuse, to disclose to a police-officer on being so
required the name and address of the person by whom it was
printed or otherwise made, he shall be punished with fine which
may extend to two hundred rupees.

(3) Where the name of any person appears on any document in


respect of which any person is charged with an offence under sub-
section (1) or on any other document used or distributed in
connection with that document it any, until the contrary is proved,
be presumed that person caused the document to be made.

CLASSIFICATION OF OFFENCE

Punishment - Fine of 100 rupees, Non-Cognizable, Bailable and


Triable by any Magistrate, Non-compoundable.