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Cheating or Valuable Security Forgery
02-Apr-2026 (In Criminal Law)
A Marketing Manager of a Defunct Company represents himself falsely as MD authorized by defunct board executes an agreement and collects loan of Rs, 50 lakhs. He announces company bankrupt within 19 days. Guarantee cheque of mediator, witness cum guarantor also defaultd. Is it cheating ot Valuable Security forgery?
This is primarily a cheating fraud case not just a cheque bounce. Forgery will apply only if false documents/authority papers are proved.
the person posing as MD (main accused
guarantor ,NI Act + possible conspiracy if involved.
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Adv. Raman Sahu
Adv. Raman Sahu
Hisar | 25+ Answers
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its clearly cheating fraud, if he falsely claim to be authorized by company, bank can file complaint or any authorized person on behalf of bank can file complaint in this regard. guarantor whose cheque is dishonor may also face similar charges if found that he is also in plan of cheating, but cheque dishonor case is also he is responsible
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this situation involves multiple offences, not just one. Based on your facts, it primarily amounts to cheating, along with forgery and related offences under the BNS
Primary: Sec. 318 BNS (Cheating)
Along with: Sec. 338 / 336 BNS (Forgery)
Also: Sec. 339 BNS (Use of forged document)
Plus: NI Act Sec. 138 (Cheque bounce)(if any cheque is there)
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Adv. Shreya Dixit
Adv. Shreya Dixit
Gurgaon / Gurugram | 25+ Answers
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This appears to be a case of cheating (Section 420 IPC) rather than only forgery.
The key element is dishonest intention from the outset—the person falsely represented himself as MD of a defunct company, induced the lender to part with ₹50 lakhs, and shortly thereafter declared bankruptcy. This indicates fraudulent inducement and deception at inception.
Additionally, if any documents or authority letters were fabricated, offences of forgery (Sections 468/471 IPC) may also apply. If cheques were issued dishonestly, Section 138 NI Act may also be invoked.
So, primarily cheating, with possible forgery and cheque dishonour offences depending on evidence.
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Adv. Sumegh Garg
Adv. Sumegh Garg
Gurgaon / Gurugram | 100+ Answers
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Yes, this scenario attracts both cheating under Section 420 IPC and forgery of valuable security under Section 467 IPC, read with Section 468 (forgery for purpose of cheating).
The accused misrepresented himself as MD with board authorization — a false pretense — to induce the lender into parting with Rs. 50 lakhs. This squarely constitutes cheating. The dishonest intention is evident from the fact that the company was declared bankrupt within merely 19 days of the transaction, strongly suggesting the representation was fraudulent from inception.
The execution of a loan agreement under false authority also constitutes forgery, as the document was created to deceive. If the guarantee cheque was issued knowing it would dishonor, Section 138 of the Negotiable Instruments Act is additionally attracted against the guarantor.
Key elements to establish: (1) false representation of authority, (2) fraudulent inducement, (3) wrongful gain/loss, and (4) pre-existing intent to defraud. The short gap between loan collection and insolvency declaration is strong circumstantial evidence of mens rea.
You should file an FIR under Sections 420, 467, 468, and 471 IPC, and pursue a separate complaint under Section 138 NI Act for cheque dishonor.
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Adv. Neha Gupta
Adv. Neha Gupta
Kurukshetra | 100+ Answers
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