Whoever dishonestly or fraudulently prevents any debt or demand due to himself or to any other person from being made available according to law for payment of his debts or the debts of such other person, shall be punished with imprisonment of either description for a term which may extend to two years, or with fine, or with both.
IPC Section 422: Simplified Explanation
IPC Section 422 deals with the offence of dishonestly or fraudulently preventing any debt or demand due to a debtor from being made available to his creditors. This section applies when an individual intending to defraud takes action to ensure that money owed to them or property that could satisfy their debts is not accessible to their creditors. This could involve fraudulent transfers, concealment of assets, or any other means to obstruct creditors from recovering their dues.
Is IPC Section 422 bailable?
IPC Section 422 is bailable. The nature of the offence, which involves financial fraud rather than direct harm to individuals, allows for the possibility of bail under judicial discretion.
IPC Section 422 Punishment
The punishment under IPC Section 422 involves imprisonment of either description for a term extending to two years, with a fine, or with both. This penalty aims to deter individuals from attempting to defraud creditors by obstructing the availability of debts or assets.
Example of IPC Section 422
A real-life example of IPC Section 422 involved a company director who, anticipating the company’s insolvency, diverted payments from clients to his account rather than allowing them to be used to settle the company’s debts. This diversion was intended to ensure that creditors could not access these funds, thereby preventing them from recovering the money owed to them by the company. When the company’s financial troubles came to light and creditors investigated, they discovered the fraudulent redirection of payments. The director was arrested and charged under IPC Section 422 for dishonestly preventing debts from being available for creditors. In court, he was found guilty, sentenced to one year in prison, and fined, reflecting the serious consequences of such deceptive actions intended to defraud creditors.
