Section 320 BNS: Dishonest or fraudulent removal or concealment of property to prevent distribution among creditors
Bharatiya Nyaya Sanhita, 2023
Section 320 BNS at a Glance
Section 320 BNS deals with dishonest or fraudulent removal or concealment of property to prevent distribution among creditors. It is bailable and non-cognizable, triable by any Magistrate; it replaced Section 421 IPC on 1 July 2024.
Imprisonment of either description for a term which shall not be less than six months but which may extend to two years.
Section 320 BNS Bare Act Text
320. Dishonest or fraudulent removal or concealment of property to prevent distribution among creditors
Whoever dishonestly or fraudulently removes, conceals or delivers to any person, or transfers or causes to be transferred to any person, without adequate consideration, any property, intending thereby to prevent, or knowing it to be likely that he will thereby prevent, the distribution of that property according to law among his creditors or the creditors of any other person, shall be punished with imprisonment of either description for a term which shall not be less than six months but which may extend to two years, or with fine, or with both.
Source: Section 320, Bharatiya Nyaya Sanhita, 2023
Section 320 BNS in Simple Words
Section 320 of the Bharatiya Nyaya Sanhita (BNS) deals with a person who dishonestly or fraudulently removes, conceals, delivers, or transfers any property, or causes it to be transferred, without adequate consideration. The offence applies where the person intends to prevent, or knows it to be likely that they will prevent, the distribution of that property according to law among their own creditors or the creditors of any other person. In simple terms, it targets conduct where someone tries to defeat lawful creditor claims by shifting assets out of reach without fair value.
It is not enough that the property was moved or transferred. The prosecution must show that the act was done dishonestly or fraudulently, without adequate consideration, and with the intent or knowledge that it would obstruct lawful distribution among creditors. This provision protects creditors from sham transfers and asset-stripping.
Ingredients of Section 320 BNS
- Removal, concealment, delivery, or transfer of property without adequate consideration
- Dishonest or fraudulent intention to prevent distribution of property according to law among creditors
- Knowledge that such disposition is likely to prevent lawful distribution among creditors
- Punishment under Section 320 BNS of imprisonment not less than six months but extending up to two years, or fine, or both
Punishment Under Section 320 BNS
Imprisonment of either description for a term which shall not be less than six months but which may extend to two years.
The court may impose fine alone, or fine in addition to imprisonment.
Dishonest or fraudulent removal, concealment, delivery, or transfer of property without adequate consideration to prevent distribution among creditors carries imprisonment of either description for not less than six months and up to two years, or fine, or both.
Example of Section 320 BNS
When Section 320 BNS Does Not Apply
- The property was alienated in a genuine transaction supported by full and adequate consideration
- The transfer was executed openly without any fraudulent or dishonest intent to defeat lawful distribution among creditors
- The movement or storage of property was undertaken for operational necessity or safety reasons rather than concealment
Section 320 BNS in the IPC (Previous Law)
Section 320 BNS replaces Section 421 IPC from the old criminal code.
Section 421 IPC corresponds to Section 320 BNS. While the elements of the offence regarding fraudulent transfer or concealment of property without adequate consideration remain unchanged, Section 320 BNS introduces a minimum term of imprisonment where imprisonment is awarded, specifying a term which shall not be less than six months but which may extend to two years, or with fine, or with both. Under Section 421 IPC, no statutory minimum period of imprisonment was prescribed.
View IPC Section 421 →FAQs on Section 320 BNS
What does Section 320 BNS punish in practice?▼
It punishes dishonest asset-shifting done to stop property from reaching creditors or other entitled persons. The focus is on the intention behind the transfer or removal, not just the act itself.
Under Section 320 BNS, is it enough to move property away?▼
No. The prosecution must show that the movement or transfer was done dishonestly or fraudulently and with the purpose of defeating distribution. A genuine transaction without such intent will not usually attract this section.
Can Section 320 BNS apply in loan or recovery disputes?▼
Yes, it often comes up where a borrower or debtor tries to hide or transfer assets to avoid recovery. Courts will look at timing, surrounding facts, and whether the act was meant to defeat lawful claims.
Under Section 320 BNS, is the offence bailable?▼
Yes, it is generally bailable and non-cognizable. That means arrest and investigation powers are more limited than in serious offences, though the facts of each case still matter.
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Sources: Bare Act Text, Bharatiya Nyaya Sanhita, 2023 · Last updated: 16 Oct 2026 ·