What Is The Penalty For Fraud?

The term fraud includes all acts committed by a party to induce the other party to enter into a contract with an intention to device. When a party to the contract makes a false statement intentionally, he would be liable for fraud. But if a person honestly believes his statement to be true, he cannot be held liable fraud. When the party to the contract conceals materials facts, essential to the contract, which he is under an obligation to disclose to the other party before entering into a contract, he is guilty of fraud. The seller is bound to disclose to the buyer about the faults in the goods he is selling.

                                When a person while making a contract has no intention to perform his part of promise, it is considered as an act to defraud other. Act fitted to deceive means any act, which is done with the intention of committing fraud. This is general clause and includes all cases, which are not covered by other clauses. A person can adopt different methods to cheat the other party. It is therefore, difficult to explain all the methods under the definition of fraud. However, according to this sub-section all the unfair ways, which a man can adopt to deceive the other party, will be considered fraud.

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