Bharatiya Nyaya Sanhita, 2023
Section 320 BNS: Dishonest or Fraudulent Removal or Concealment of Property to Prevent Distribution Among Creditors
Section 320 of the Bharatiya Nyaya Sanhita, 2023 punishes dishonest or fraudulent dealings with property intended to prevent, or known to be likely to prevent, its lawful distribution among the offender's creditors or the creditors of another person.
Section 320 BNS - Statutory Provision
Section 320 applies where a person dishonestly or fraudulently removes, conceals or delivers property to another person, or transfers or causes property to be transferred to another person without adequate consideration, intending thereby to prevent, or knowing it to be likely that this will prevent, the lawful distribution of that property among his creditors or the creditors of another person.
The provision appears in the BNS group dealing with fraudulent deeds and dispositions of property. Its focus is not merely on the existence of a debt, but on dishonest or fraudulent dealing with property aimed at defeating lawful creditor distribution.
Essential Ingredients of Section 320 BNS
The principal elements are:
- there must be property capable of lawful distribution among creditors;
- the accused must dishonestly or fraudulently remove, conceal or deliver the property, or transfer or cause it to be transferred without adequate consideration;
- the conduct must relate to creditors of the accused or creditors of another person; and
- the accused must intend to prevent lawful distribution of the property, or know that the conduct is likely to prevent such distribution.
The required mental element is central. A transaction is not brought within Section 320 merely because it later reduces the assets available to creditors; the dishonest or fraudulent purpose, or the specified knowledge of the likely result, must be established.
Removal, Concealment, Delivery or Transfer of Property
Section 320 covers several methods by which property may be kept away from creditors. These include dishonest or fraudulent removal or concealment, delivery to another person, and a transfer or caused transfer made without adequate consideration.
The breadth of the wording is intended to address both direct physical concealment and transactions structured to place property beyond lawful distribution.
Transfer Without Adequate Consideration
The section expressly includes transferring, or causing the transfer of, property to another person without adequate consideration where the required dishonest or fraudulent intention or knowledge is present.
Inadequate consideration is therefore relevant within the statutory structure, but it must be read together with the requirement that the transaction be undertaken dishonestly or fraudulently for the creditor-defeating purpose described in Section 320.
Intention or Knowledge That Creditors Will Be Prevented
Liability can arise where the accused actually intends to prevent distribution according to law, or where the accused knows that the conduct is likely to prevent such distribution.
The section protects not only the accused's own creditors but also creditors of another person where the accused dishonestly or fraudulently deals with that other person's property in the manner specified.
Punishment, Cognizability, Bail and Trial Court
| Provision | Section 320 BNS |
|---|---|
| Offence | Dishonest or fraudulent removal, concealment, delivery or transfer of property to prevent lawful distribution among creditors |
| Punishment | Imprisonment of either description for not less than six months and up to two years, or fine, or both |
| Cognizable | No - non-cognizable |
| Bailable | Yes |
| Trial court | Any Magistrate |
Compounding Under the BNSS
The Bharatiya Nagarik Suraksha Sanhita, 2023 lists the Section 320 offence among compoundable offences. The persons identified for compounding are the creditors who are affected by the fraudulent removal or concealment of property.
Whether compounding is available in a particular prosecution should be assessed with reference to the exact charge, the persons affected and the procedural requirements of the BNSS.
Official Legal Sources
For authoritative statutory wording, procedural classification and commencement information, consult India Code and the Ministry of Home Affairs resources listed in the right sidebar. The official Act, BNSS First Schedule and Gazette notification prevail in case of any discrepancy in a secondary source.
Frequently Asked Questions
What does Section 320 BNS punish?
It punishes dishonest or fraudulent removal, concealment, delivery or specified transfer of property intended to prevent, or known to be likely to prevent, its lawful distribution among creditors.
Does Section 320 apply only to a person's own creditors?
No. The statutory wording also covers conduct intended to prevent lawful distribution among the creditors of another person.
What is the minimum punishment under Section 320 BNS?
The imprisonment term, where imprisonment is imposed under the statutory provision, is not less than six months and may extend to two years. The section also permits fine, or both imprisonment and fine.
Is Section 320 BNS cognizable?
No. It is classified as non-cognizable.
Is Section 320 BNS bailable?
Yes. It is bailable.
Which court tries Section 320 BNS?
The offence is triable by any Magistrate.
Can a Section 320 offence be compounded?
The BNSS lists this offence as compoundable by the creditors affected, subject to the applicable procedural requirements.
This page provides general legal information. Application of Section 320 depends on the facts, evidence and law applicable to the individual case.