Law and You > Criminal Laws > Bharatiya Nyaya Sanhita, 2023 > Definitions > Dishonestly, Wrongful Gain and Wrongful Loss (Ss. 2(7), 2(36) to 2(38) BNS)
Wrongful gain and wrongful loss are intertwined concepts. To establish wrongful gain, there must be a corresponding wrongful loss. In criminal law, these terms act as a cause-and-effect relationship, where the gain of one party leads to the loss of another. The infliction of Wrongful Gain and Wrongful Loss is a crucial component in the crimes of Criminal Breach of Trust, Criminal Misappropriation of Property, Theft, and other similar offenses. The use of illegal methods is a component of both of the two offenses. Wrongful gain and wrongful loss have significant implications in white-collar crimes such as fraud, embezzlement, and insider trading. These offenses often involve financial gains achieved through deceitful or unauthorized means. Wrongful loss can encompass various forms of harm, including financial, physical, and emotional.
Examples of Wrongful gain and Wrongful Loss:
- Consider a scenario where an individual forges documents to acquire ownership of someone else’s property. In this case, the person gains wrongfully (through the act of forgery) while causing a wrongful loss to the original owner.
- Similarly, in cases of embezzlement, the embezzler gains wrongfully at the expense of the entity’s rightful owner.
Definitions:
- Wrongful Gain: According to Section 2(36) of the Bharatiya Nyaya Sanhita, 2023 “wrongful gain” means gain by unlawful means of property to which the person gaining is not legally entitled
- Wrongful Loss: According to Section Section 2(37) of the of the Bharatiya Nyaya Sanhita, 2023, “Wrongful loss” is any loss by unlawful means of property to which the person losing it is legally entitled.
- Gaining Wrongfully and Losing Wrongfully: According to Section 2(38) of the of the Bharatiya Nyaya Sanhita, 2023, a person is said to gain wrongfully when such person retains wrongfully, as well as when such person acquires wrongfully. A person is said to lose wrongfully when such person is wrongfully kept out of any property, as well as when such person is wrongfully deprived of property.
The term “wrongful” refers to harming a party’s legal rights. The owner of the property must either be unlawfully denied access to it or lose possession of it in order for there to be a wrongful loss or gain.
Ingredients of Wrongful Gain:
The ingredients of wrongful gain are as follows −
- There must be gain of some property;
- The property to which a person was not legally entitled must be gained; and
- Any such gain must be made by unlawful or illegal means.
It must be noted that Wrongful gain does not only cover acquiring a property wrongfully but also covers the retaining a property wrongfully it means that a person can be made liable not only in cases when any property has been gained wrongfully but also in situation where retaining of any such property has been made by wrongful means. When a person gains something by unlawful means to which he is not legally entitled it will be referred as wrongful gain.
Ingredient of Wrongful Loss:
Following are the ingredients of wrongful loss −
- There must be loss of some property
- The property to which the person losing was legally entitled and
- Loss must have been caused by unlawful means
A person is said to lose wrongfully when such person is wrongfully kept out of any property as well as when such person is wrongfully deprived of property. When a person who is not the owner of the property loses the property wrongfully then this situation will be covered under wrongful loss.
In Paltu Goswami v. Ram Kumar Das, 1960 CRILJ 1662 case where Paltu Goswami and Haridhan Goswami were charged under Section 379 IPC on a complaint that they removed some jute plants which were kept by the respondent in a pond for the purpose of wetting. They denied the offence. According to them, the pond belonged to the 1st accused and was surrounded by his paddy lands and the respondent kept his jute dipped in the said pond and all that they did was to remove the jute from the said pond in private defence of property and kept it in the adjacent paddy land. The jute was not stolen, but kept stored in the adjacent field and the respondent was requested to take it away which he refused to do. Instead of removing the jute, he rushed to Court with the criminal complaint accusing them of theft. The Court held that no wrongful loss was caused to the complainant.
Examples of Wrongful Gain and Wrongful Loss:
Under the Bharatiya Nyaya Sanhita (BNS), examples of wrongful gain and wrongful loss can be found in various offenses where individuals obtain financial or material benefits through illegal or dishonest means. Here are some examples:
- Criminal Breach of Trust (Section 316 BNS) (Section 405 IPC): A person entrusted with property, such as a banker, a trustee, or an agent, dishonestly misappropriates or converts it for their own use or for someone else’s benefit. The perpetrator gains wrongfully while causing a loss to the owner of the property.
- Cheating (Section 318 BNS) (Section 415 IPC): A person fraudulently induces another person to deliver property or any valuable security or to do any act, intending to dishonestly induce wrongful gain for themselves or another person. The perpetrator gains wrongfully by deceiving the victim.
- Forgery (Section 336 BNS) (Section 463 IPC): A person fraudulently makes or alters a document or part of a document with the intention of causing wrongful gain to themselves or another person. For example, forging a signature on a cheque to wrongfully obtain money from someone’s account.
- Extortion (Section 308 BNS) (Section 383 IPC): A person intentionally puts another person in fear of injury to that person or any other person and thereby dishonestly induces the person so put in fear to deliver property or valuable security. The perpetrator gains wrongfully by using threats or intimidation to obtain property from the victim.
- Embezzlement (Section 314 BNS) (Section 403 IPC): A person entrusted with property, such as a clerk or a servant, fraudulently misappropriates it or converts it to their own use. The perpetrator gains wrongfully by unlawfully appropriating the property for their own benefit.
- Forgery for purpose of cheating (Section 336 BNS) (Section 468 IPC): A person commits forgery with the intention of using the forged document for the purpose of cheating or harming the financial interests of another. The perpetrator gains wrongfully by deceiving others through the use of forged documents.
- Mischief (Section 324 BNS) (Section 425 IPC): Mischief involves intentionally causing damage to property belonging to another person. The victim suffers a wrongful loss due to the destruction or impairment of their property caused by the perpetrator’s actions.
- Theft (Section 303 BNS) (Section 378 IPC): When a person dishonestly takes movable property out of the possession of another without their consent and with the intention of permanently depriving them of it, the owner of the property suffers a wrongful loss.
Section 326 BNS (Section 435 to 438 of IPC) characterises mischief by the method adopted to cause wrongful loss or damage. It deals with the remedies provided by IPC in case of damage being caused by fire. These sections are together called offences of Arson.
These examples illustrate how wrongful gain can occur in various criminal offenses under the IPC, where individuals unlawfully obtain financial or material benefits through deceit, fraud, misappropriation, or other dishonest means.
Difference between Wrongful Gain and Wrongful Loss:
| Wrongful Gain | Wrongful Loss |
| In the crime of wrongful gain, the offender gains the property unlawfully. | In the crime of wrongful loss, the offender wrongfully causes the victim to lose the property. |
| In the crime of wrongful gain, the offender is not legally entitled to gain the property. | In the crime of wrongful loss, the victim is legally entitled over the property losing. |
| When committing the crime of unlawful gain, the criminal is considered to have gained unfairly both when retaining and when acquiring property. | Under the crime of wrongful loss, the victim is considered to have lost unfairly both when he is unlawfully denied access to any item and when that same thing is wrongfully taken away from him. |
| Wrongful gain denotes the offender’s gain. | Wrongful loss denotes the victim’s loss. |
Case Laws:
In Krishan Kumar v. Union of India, AIR 1959 SC 1390 case, the Court observed that wrongful gain includes wrongful retention and wrongful loss includes being kept out of the property as well as being wrongfully deprived of property. Therefore when a particular thing has gone into the hands of a servant he will be guilty of misappropriating the thing in all circumstances which show a malicious intent to deprive the master of it.
Dishonestly:
The term “dishonestly” is a crucial element in several sections in the Sanhita, particularly those dealing with offenses such as theft, cheating, criminal breach of trust, and dishonest misappropriation of property. Section 2(7) of the Bharatiya Nyaya Sanhita, 2023 defines “dishonestly” as follows: “dishonestly” means doing anything with the intention of causing wrongful gain to one person or wrongful loss to another person.
This definition essentially hinges on the intent to cause wrongful gain or wrongful loss. Dishonesty involves acting with the intention to obtain a benefit for oneself or another, knowing that such an act will cause harm or loss to someone else.
Ingredients of ‘Dishonestly’:
- Some act has been done;
- This has been done with intention to cause wrongful gain to one person or wrongful loss to another person.
Examples of ‘Dishonestly’ in BNS:
Here are some examples of offenses involving dishonesty under the Bharatiya Nyaya Sanhita, 2023:
- Theft (Section 378 IPC): A person dishonestly takes movable property out of the possession of another without that person’s consent. For example, stealing someone’s wallet or mobile phone without their knowledge or permission would constitute theft.
- Criminal Breach of Trust (Section 405 IPC): A person entrusted with property dishonestly misappropriates or converts it for their own use in violation of any direction of law. For instance, an employee embezzling funds entrusted to them by their employer would be committing criminal breach of trust.
- Cheating (Section 415 IPC): A person dishonestly induces another person to deliver any property or to make, alter, or destroy any valuable security, or to do or omit to do anything which they would not do or omit if they were not so deceived. An example would be someone deceiving another into investing money in a fraudulent scheme.
- Forgery (Section 463 IPC): Making a false document with the intent to cause damage or injury to another person or to commit fraud. For example, forging someone’s signature on a cheque or a legal document with the intention of dishonestly obtaining money or property.
- Counterfeiting (Section 489 IPC): Making or possessing any counterfeit currency notes or banknotes with the intent to use them as genuine or to knowingly pass them off as genuine. This offense involves dishonesty as it involves deception regarding the nature and value of the currency.
These are just a few examples of offenses under the IPC that involve dishonesty. In each case, dishonesty is a key element, requiring the perpetrator to act with the intent to deceive, defraud, or cause wrongful gain or loss to another person or entity.
Conclusion:
Wrongful gain typically involves intentional actions aimed at acquiring property or benefits unlawfully. The concepts of wrongful gain and wrongful loss also have ethical and moral dimensions. Society places value on honesty, integrity, and respecting the rights of others. Engaging in actions that result in wrongful gain or loss challenges these principles. To prevent wrongful gain and loss, individuals and organizations should emphasize transparency, accountability, and adherence to legal and ethical standards. Implementing robust internal controls can help mitigate the risk of these actions. The legal system provides remedies for cases involving wrongful gain and wrongful loss. Those who suffer wrongful loss can seek compensation, while those who gain wrongfully can face criminal charges and subsequent penalties. those who suffer wrongful loss can seek compensation through civil remedies, in addition to criminal proceedings.
For More Articles on the Bharatiya Nyaya Sanhita, 2023 Click Here