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In these contractual dealings, each act is intended to induce the other party to contract. Which does NOT, merely on the facts described, amount to fraud under section 17 of the Indian Contract Act,…

Question and options

In these contractual dealings, each act is intended to induce the other party to contract. Which does NOT, merely on the facts described, amount to fraud under section 17 of the Indian Contract Act, 1872?

  1. A false factual suggestion by someone who does not believe it true.

  2. Deliberate concealment of a known material fact with intent to deceive.

  3. An incorrect representation honestly believed true and made without intent to deceive.

  4. A promise made without any intention of performing it.

Answer and explanation

Correct answer: C - An incorrect representation honestly believed true and made without intent to deceive.

Section 17 of the Indian Contract Act, 1872 includes a false suggestion by one who does not believe it true, active concealment of a fact by one having knowledge of it, and a promise made without any intention of performing it, when done to deceive or induce a contract. An incorrect representation honestly believed true lacks the intent to deceive; it may be misrepresentation under section 18, but it is not fraud.

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