Redefining Coercion, From “Forbidden” to “Punishable”: Analysing the Impact of the Indian Contract Amendment Bill, 2024

- Swagat Ahuja

Introduction

The Indian Contract (Amendment) Bill, 2024 (“the Bill”) proposes a significant alteration to the Indian Contract Act, 1872 (“Contract Act”), particularly in its definition of coercion under Section 15. Section 15 of the Contract Act currently defines coercion as:

“The committing, or threatening to commit, any act forbidden by the Indian Penal Code under (45, 1860), or the unlawful detaining, or threatening to detain, any property, to the prejudice of any person whatever, with the intention of causing any person to enter into an agreement.”

The Bill, seeking to replace the phrase “forbidden by the Bharatiya Nyaya Sanhita (“BNS”)” (formerly the Indian Penal Code (“IPC”)) with “punishable by any law for the time being in force,” marks a noteworthy shift in legal terminology and raises questions about the evolution of coercion definitions. 

Understanding the Amendment

The proposed change introduces two key considerations: the alteration in terminology from “forbidden” to “punishable” and the expansion in the scope of relevant acts from the IPC/BNS to encompass all prevailing laws. This discussion primarily focuses on the former, reserving the latter for subsequent analysis in another blog.

The rationale for the Terminological Shift

The Bill attempts to justify the shift from “forbidden” to “punishable” on two main grounds. Firstly, it is proposed that the purpose of the IPC is not solely to forbid actions but also to create punishable offenses. Secondly, the potential for discrepancies when courts must determine whether an act falls under forbidden or punishable categories is stated to be an issue.

However, upon closer examination, this rationale appears insufficient. The reservation is correct in stating that the IPC does not expressly forbid acts but only punishes them. However, contrary to the assertion in the Bill, courts have not had much difficulty in holding acts forbidden or not, by implication. The underlying theme is that the term “any act forbidden by the Indian Penal Code” is wider than the term “punishable by the Indian Penal Code" as was held in Chikkam Ammiraju v. Chikkam Seshamma. (“Chikkam case”)

It can be presumed that acts punishable under IPC are also necessarily forbidden under it. But the contrary cannot be assumed since acts forbidden by IPC need not always be punishable. Such was the Chikkam case, where a man threatened to commit suicide, allegedly coercing his wife and son to sign a release deed in his Brother’s favour. The court grappled with the distinction between acts forbidden and punishable under the IPC. Ultimately, it determined that while suicide itself is not punishable, it can nevertheless be implied from the act that it is forbidden since its abetment is punishable. Moreover, the reasoning relied upon was that since the abetment of suicide is punishable, the act can be inferred to be forbidden and is only not punishable due to it being impossible to punish a dead man. It was also hinted that suicide is not the only exceptional circumstance where this issue may arise. 

Illustration - For example, “A”, a lunatic or a minor is exempted from punishment under the IPC due to certain exceptions. This however cannot be used to infer that the IPC does not forbid A’s act. It is only that the acts are not punishable since they attract certain exceptions.

Impact on Future Cases

The implications of this terminological shift extend to future legal proceedings. By replacing “forbidden” with “punishable,” the amendment potentially excludes instances where acts are forbidden but not punishable under the IPC. In the Chikkam case, a different outcome might have arisen if the terminology had been “punishable” rather than “forbidden,” as suicide, while not punishable, was deemed forbidden due to its abetment being punishable. This narrower scope of definition of coercion could allow parties to coerce others through acts that, while not punishable, are forbidden, thereby evading legal consequences.

Illustration - Should this Bill be passed, a person coercing another to sign a deed by threat of committing suicide would not longer be caught by section 15 of the Contract Act since suicide cannot possibly be made punishable under the IPC or anywhere else. (doing so would anyway have to be a formality to address this situation since no person who has committed suicide can be subjected to punishment) 

Conclusion

The Bill heralds a significant shift in legal terminology with its redefinition of coercion. While the rationale behind the terminological change aims to address discrepancies in legal interpretation, it raises important questions about the intersection of forbidden and punishable acts. This change in terminology can also be seen as a balancing act which is done considering the expansion in the scope of the section (from being limited to just IPC to now covering all laws). The subsequent blog would cover in depth the other issues which can be anticipated to manifest, should this Bill be accepted.