deceit
Deceit is the civil wrong of fraud. The plaintiff must prove that the defendant made a false representation of fact, knowing it to be false or without belief in its truth, or recklessly careless whether it was true; that it was meant to be acted on; that the plaintiff did act on it; and that loss resulted. Derry v. Peek held that mere negligence, without dishonesty, is not deceit.
In Indian law, fraud in contract is defined in s.17 of the Indian Contract Act, 1872 and makes the contract voidable under s.19; the tort of deceit gives damages. Criminal liability may arise as cheating under s.318 BNS (old s.415 IPC). Negligent misstatement is a separate tort.
Example
Since the directors honestly believed the prospectus, there was no deceit, though they may still be liable for negligent misstatement.
In Indian law
- Section 17, Indian Contract Act, 1872: fraud
- Derry v. Peek (House of Lords, 1889): dishonesty is essential to deceit
See also
Read more in the study notes
- From the IPC to the BNS: background, extent and key reforms (Bharatiya Nyaya Sanhita)
- Rape and sexual offences (Bharatiya Nyaya Sanhita)
- Offences relating to marriage: dowry death, bigamy and cruelty (Bharatiya Nyaya Sanhita)
- Kidnapping, abduction, slavery and forced labour (Bharatiya Nyaya Sanhita)
- Character evidence in civil and criminal cases (sections 46 to 50) (Bharatiya Sakshya Adhiniyam)
- Prospectus: contents, kinds and liability for misstatement (Company Law)