An Analysis of Section 489B of the Indian Penal Code: Using Forged or Counterfeit Currency

An Analysis of Section 489B of the Indian Penal Code: Using Forged or Counterfeit Currency

Introduction

The proliferation of counterfeit currency poses a significant threat to the economic stability and integrity of a nation. In India, Chapter XVIII of the Indian Penal Code, 1860 (IPC), specifically Sections 489A to 489E, addresses offences relating to currency notes and banknotes. Among these, Section 489B deals with the grave offence of using as genuine, forged or counterfeit currency-notes or banknotes. This article seeks to provide a comprehensive analysis of Section 489B IPC, delving into its essential ingredients, judicial interpretations, and the critical element of mens rea. The discussion will draw heavily upon statutory provisions and case law, including the reference materials provided, to elucidate the scope and application of this section.

Statutory Provision: Section 489B of the Indian Penal Code

Section 489B of the Indian Penal Code, 1860, is titled "Using as genuine, forged or counterfeit currency-notes or bank-notes." The provision reads as follows:

"Whoever sells to, or buys or receives from, any other person, or otherwise traffics in or uses as genuine, any forged or counterfeit currency-note or bank-note, knowing or having reason to believe the same to be forged or counterfeit, shall be punished with imprisonment for life, or with imprisonment of either description for a term which may extend to ten years, and shall also be liable to fine."[1]

As noted in Jubeda Chitrakar @ Jaba @ Zubeda Chitrakar v. State Of West Bengal, Sections 489B and 489C were introduced into the Penal Code by Act 12 of 1899. Section 489B was subsequently amended by Act 26 of 1965, substituting the punishment of transportation for life with imprisonment for life.[2]

Essential Ingredients of Section 489B IPC

To establish an offence under Section 489B IPC, the prosecution must prove the following essential ingredients beyond a reasonable doubt:

  1. The currency note or banknote in question is forged or counterfeit.
  2. The accused engaged in one or more of the prohibited activities:
    • Selling the note to another person;
    • Buying the note from another person;
    • Receiving the note from another person;
    • Otherwise trafficking in the note; or
    • Using the note as genuine.
  3. The accused, at the time of such selling, buying, receiving, trafficking, or using, knew or had reason to believe that the said currency note or banknote was forged or counterfeit.

The High Court of Madhya Pradesh in Shabbir Sheikh And Others v. State Of Madhya Pradesh outlined similar ingredients, emphasizing the accused's intention to use the note as genuine and the knowledge or reason to believe it to be forged.[3]

Analysis of Key Legal Issues and Judicial Interpretations

1. Mens Rea: "Knowing or Having Reason to Believe"

The cornerstone of an offence under Section 489B IPC is the element of mens rea, specifically, that the accused must have acted "knowing or having reason to believe the same to be forged or counterfeit." The absence of this mental element negates the offence. This principle has been consistently reiterated by various High Courts and the Supreme Court.

The Supreme Court in Umashankar v. State of Chhattisgarh, a case frequently cited, held that the mens rea for offences under Sections 489B and 489C is "knowing or having reason to believe the currency-notes or bank-notes are forged or counterfeit." Without this mens rea, the specified actions (selling, buying, receiving, trafficking, using, or possessing) are insufficient to constitute an offence under these sections.[4] This was reaffirmed in cases like Rajendra Others v. State Of Maharashtra[5] and The State v. C. Ronald And Ors.[6]

The Calcutta High Court in Jubeda Chitrakar clarified that the component of mens rea for an offence falling under Section 489B and/or 489C is the knowledge or having reason to believe that the currency note or banknote is forged or counterfeit, coupled with the intention to use the same as genuine or the knowledge that it may be used as genuine.[2] Similarly, the Karnataka High Court in FRANCES BABU DESILVA v. THE STATE OF KARNATAKA stressed that in the absence of any evidence to show that the accused had knowledge about the alleged fake notes, or any reason to believe they were forged or counterfeit, a necessary ingredient of Section 489B IPC is lacking.[7]

The Kerala High Court in Sainudheen Koya And Another /accused v. State Of Kerala held that mere possession or use of counterfeit currency notes without the knowledge or reason to believe that the notes were counterfeit or forged, and intending to use the same as genuine, cannot lead to a conviction under Section 489B or 489C.[8] This court also highlighted the importance of putting circumstances appearing in evidence against the accused to him under Section 313 of the Code of Criminal Procedure, 1973 (CrPC), to enable him to explain them, a point also made in The State v. C. Ronald And Ors.[6]

Proof of mens rea need not always be by direct evidence. As observed in Neeraj Sharma v. State Of H.P. (in the context of Section 489C, but principles are analogous), the knowledge or reason to believe and the intention to use as genuine can be inferred from circumstances.[9] The Supreme Court in Ponnuswamy v. State (cited in Neeraj Sharma) held that silence on the part of the appellant regarding the source of forged notes could be a telling circumstance.[9] However, a presumption of mens rea is not automatic. In M. Mammutti v. State of Karnataka, the Supreme Court noted that if notes were of such a nature that a mere look would convince anyone they were counterfeit, such a presumption could reasonably be drawn, but this was fact-dependent.[10]

2. Actus Reus: "Sells to, or buys or receives from... or otherwise traffics in or uses as genuine"

Section 489B criminalizes specific actions involving forged or counterfeit notes, beyond mere possession. The Kerala High Court in Muhammed Koya And Another v. State Of Kerala explicitly stated that to attract Section 489B, mere possession of a counterfeit note is not enough. There must be evidence to show that the accused "sells to or buys, or receives from any other person, or otherwise traffics in or uses as genuine" the counterfeit note.[11]

The Calcutta High Court in Jubeda Chitrakar also pondered whether possession of any forged or counterfeit currency note is sufficient to inculpate an accused for an offence punishable under Section 489B, concluding that possession by itself does not amount to the activities specified in Section 489B.[2] The act of "using as genuine" is a key component, as seen in Bachan Singh And Anr. v. The State Of Punjab, where one of the appellants was convicted under Section 489B for attempting to use a counterfeit note to get change.[12] Cases like MD. TOUSIF @ GARA @ TINKU v. STATE OF WEST BENGAL[13] and HABIBUR RAHAMAN v. STATE OF WEST BENGAL[14] often involve allegations of possession for the purpose of trafficking or actual use, leading to convictions under Section 489B, sometimes in conjunction with Section 489C (possession) and Section 120B (criminal conspiracy).

3. "Currency Note" or "Bank Note" – Scope

The term "currency note" is not restricted to Indian currency. The Supreme Court in State Of Kerala v. Mathai Verghese And Others clarified that the provisions of Sections 489A to 489E of the IPC, which deal with counterfeiting currency notes, are applicable to foreign currency notes as well. The Court held that the term "currency note" as used in these sections is broad enough to include currency notes issued by any sovereign state, not just Indian currency.[15] This interpretation ensures a wide protective ambit against the harms of counterfeiting, irrespective of the currency's origin.

4. Distinction between Section 489B and Section 489C IPC

While both sections deal with counterfeit currency and require similar mens rea, they address different actions. Section 489B concerns the active use, sale, purchase, receipt, or trafficking of counterfeit notes. In contrast, Section 489C IPC punishes the mere possession of forged or counterfeit currency notes or banknotes, knowing or having reason to believe them to be forged or counterfeit and intending to use the same as genuine or that they may be used as genuine.

The Supreme Court in K. Hashim v. State Of T.N., as cited in Shabbir Sheikh And Others, differentiated these: "Section 489-B relates to using as genuine forged or counterfeited currency notes or bank notes. The object of Legislature in enacting this section is to stop the circulation of forged notes by punishing all persons who knowing or having reason to believe the same to be forged do any act which could lead to their circulation. Section 489C deals with possession of forged or counterfeit currency notes or bank notes. It makes possession of forged and counterfeited currency notes or bank notes punishable."[3], [16]

Discussion of Other Reference Materials

Several provided reference materials, while part of the corpus, do not directly bear on the substantive interpretation of Section 489B IPC. For instance:

  • Uma Shankar Sahu Applicant v. State Of Chhattisgarh pertains to anticipatory bail for an offence under Section 379 IPC (theft) and does not discuss Section 489B.[17]
  • K.R Purushothaman v. State Of Kerala deals with criminal conspiracy (Section 120B IPC) and misappropriation under the Prevention of Corruption Act. While it discusses general principles of criminal law such as the establishment of conspiracy and evidentiary standards for mens rea,[18] its direct relevance to the specific ingredients of Section 489B is limited, though the emphasis on robust evidence for mens rea is a universally applicable principle.
  • Shaheen Parveen And Another v. State Of U.P. concerns Section 366 IPC (kidnapping/abduction).[19]
  • Lily Thomas v. Union Of India And Others lists various IPC sections in the context of disqualification of legislators and does not interpret Section 489B.[20]
  • Sunil Kumar Singh v. State Of Bihar discusses Sections 498A and 201 IPC.[21]

These cases, while not central to an analysis of Section 489B, illustrate the diverse landscape of Indian criminal law. The principles of evidence and criminal jurisprudence they touch upon, such as the need for clear proof and adherence to procedural safeguards, are, of course, fundamental to all criminal trials, including those under Section 489B IPC.

Cases like Amijuddin Sk v. State Of West Bengal[22] and Rajendra Others v. State Of Maharashtra[5] (Bombay High Court) further illustrate convictions under Sections 489B and 489C where recovery of Fake Indian Currency Notes (FICN) was established along with circumstances pointing towards the requisite mens rea and the prohibited acts. The case of MAHAROM MONDAL @ ANTU @ MAHARAM MONDAL v. STATE OF WEST BENGAL also involved discussions on the applicability of Section 489B and cited precedents like M. Mammutti and Umashankar.[23]

Conclusion

Section 489B of the Indian Penal Code is a critical provision aimed at combating the circulation of forged or counterfeit currency. The judiciary has consistently emphasized that a conviction under this section requires the prosecution to prove not only the actus reus – the act of selling, buying, receiving, trafficking in, or using such notes as genuine – but also the crucial element of mens rea. The accused must have known or had reason to believe that the notes were forged or counterfeit. Mere possession, without the requisite knowledge and intent or the specified actions, is insufficient for a conviction under Section 489B, though it might attract Section 489C IPC if its ingredients are met.

The interpretation of "currency note" to include foreign currency, as established in State Of Kerala v. Mathai Verghese, broadens the protective scope of these provisions. The distinction between using/trafficking (Section 489B) and mere possession (Section 489C) is vital for the correct application of the law. Courts continue to scrutinize evidence carefully, particularly concerning the establishment of mens rea, ensuring that the stringent punishments prescribed under Section 489B are imposed only when all ingredients of the offence are unequivocally proven.

References

  1. The Indian Penal Code, 1860, Section 489B.
  2. Jubeda Chitrakar @ Jaba @ Zubeda Chitrakar v. State Of West Bengal (Calcutta High Court, 2019).
  3. Shabbir Sheikh And Others v. State Of Madhya Pradesh (Madhya Pradesh High Court, 2018).
  4. Umashankar v. State of Chhattisgarh, (2001) 9 SCC 642 (as cited in Rajendra Others v. State Of Maharashtra (Bombay High Court, 2014) and other provided materials).
  5. Rajendra Others v. State Of Maharashtra (2015 AIR BOM R CRI 2 117, Bombay High Court, 2014).
  6. The State v. C. Ronald And Ors. (Calcutta High Court, 2004).
  7. FRANCES BABU DESILVA v. THE STATE OF KARNATAKA (Karnataka High Court, 2020).
  8. Sainudheen Koya And Another /accused v. State Of Kerala Represented By The Deputy Superintendent Of Police /state. (Kerala High Court, 2020).
  9. Neeraj Sharma v. State Of H.P. (Himachal Pradesh High Court, 2016), citing Ponnuswamy v. State, 1995 Cri. L.J. 2658.
  10. M. Mammutti v. State of Karnataka, AIR 1979 SC 1705 (as cited in The State v. C. Ronald And Ors. (Calcutta High Court, 2004)).
  11. Muhammed Koya And Another v. State Of Kerala Rep.By The Deputy Superintendent Of Police . (Kerala High Court, 2020).
  12. Bachan Singh And Anr. v. The State Of Punjab (1982 CRI LJ 32, Punjab & Haryana High Court, 1981).
  13. MD. TOUSIF @ GARA @ TINKU v. STATE OF WEST BENGAL (Calcutta High Court, 2022).
  14. HABIBUR RAHAMAN v. STATE OF WEST BENGAL (Calcutta High Court, 2022).
  15. State Of Kerala v. Mathai Verghese And Others (1986 SCC 4 746, Supreme Court Of India, 1986).
  16. K. Hashim v. State Of T.N . (2005 SCC 1 237, Supreme Court Of India, 2004).
  17. Uma Shankar Sahu Applicant v. State Of Chhattisgarh, Through Police Station - Kotwali Jagdalpur . (2022 SCC ONLINE CHH 1674, Chhattisgarh High Court, 2022).
  18. K.R Purushothaman v. State Of Kerala . (2005 SCC 12 631, Supreme Court Of India, 2005).
  19. Shaheen Parveen And Another v. State Of U.P. Thru Principal Secy., Home Deptt., And Others (Allahabad High Court, 2015).
  20. Lily Thomas v. Union Of India And Others (Supreme Court Of India, 2013).
  21. Sunil Kumar Singh v. State Of Bihar (Patna High Court, 2013).
  22. AMIJUDDIN SK v. STATE OF WEST BENGAL (Calcutta High Court, 2021).
  23. MAHAROM MONDAL @ ANTU @ MAHARAM MONDAL v. STATE OF WEST BENGAL (Calcutta High Court, 2022).