Indian criminal law | Updated October 2026
IPC Section 489C: Possession of Counterfeit Currency Notes - BNS Section 180
Section 489C of the Indian Penal Code, 1860 addressed possession of forged or counterfeit currency notes or bank notes where the person knew or had reason to believe they were counterfeit and intended that they be used as genuine. Its corresponding current provision is Section 180 of the Bharatiya Nyaya Sanhita, 2023 (BNS).
What did IPC Section 489C provide?
The statutory provision stated:
Whoever has in his possession any forged or counterfeit currency-note or bank-note, knowing or having reason to believe the same to be forged or counterfeit and intending to use the same as genuine or that it may be used as genuine, shall be punished with imprisonment of either description for a term which may extend to seven years, or with fine, or with both.
This provision required more than the physical discovery of a counterfeit note. Knowledge (or reason to believe) and the specified intention were material parts of the offence.
BNS Section 180: Current law
Section 180 of the Bharatiya Nyaya Sanhita, 2023 deals with possession of forged or counterfeit coin, Government stamp, currency-note or bank-note, where the person knows or has reason to believe the item to be forged or counterfeit and intends to use it as genuine or that it may be used as genuine. It prescribes imprisonment of either description for up to seven years, or fine, or both.
The BNS provision is broader in its stated categories of items than the former IPC Section 489C, which expressly concerned currency notes and bank notes.
Essential ingredients of the offence
- Possession: The accused had possession or conscious control of the item in question.
- Counterfeit character: The relevant note, coin or Government stamp was forged or counterfeit.
- Knowledge or reason to believe: The accused knew or had sufficient reason to believe the item was not genuine.
- Intention: The accused intended to use it as genuine or intended that it might be used as genuine.
Whether possession was conscious and whether the necessary mental elements are proved depend on the evidence in the particular case. Suspicion alone is not a substitute for proof of the required ingredients.
Punishment under IPC 489C and BNS 180
The punishment is imprisonment of either description for a term extending to seven years, or fine, or both. The statute does not make a seven-year sentence mandatory in every case. The sentence depends on the applicable law and facts established in court.
Practical illustrations
- Potential offence: A person knowingly keeps counterfeit notes with the intention of passing them to shopkeepers as genuine currency.
- Knowledge in dispute: A person unknowingly receives a counterfeit note in change and has no reason to believe it is fake. The requisite knowledge and intent may not be established merely by possession.
- Intention in dispute: A counterfeit note is found during a search, but there is no proof that the person intended to use it or have it used as genuine. The prosecution must still establish the statutory mental element.
These are simplified illustrations; actual outcomes depend on admissible evidence and the full circumstances.
Related provisions concerning counterfeit currency
- BNS Section 178: Counterfeiting coin, Government stamps, currency notes or bank notes (corresponding in relevant part to IPC Section 489A).
- BNS Section 179: Using as genuine or trafficking in counterfeit coin, Government stamps, currency notes or bank notes (corresponding in relevant part to IPC Section 489B).
- BNS Section 181: Making or possessing instruments or materials for forging or counterfeiting the specified items (corresponding in relevant part to IPC Section 489D).
- BNS Section 182: Making or using documents resembling currency notes or bank notes (corresponding to IPC Section 489E).
Case law reference
Re Md. Yusuf, 1986 Cri LJ 2011 (Mad.) is a citation listed in the original webpage. Its precise facts, holding and present applicability should be checked against an authenticated judgment before relying on it in court proceedings.
Frequently asked questions
What is IPC Section 489C?
It punished possession of forged or counterfeit currency notes or bank notes with knowledge or reason to believe they were counterfeit and an intention that they be used as genuine.
Which BNS section corresponds to IPC Section 489C?
Section 180 of the Bharatiya Nyaya Sanhita, 2023 deals with possession of forged or counterfeit coin, Government stamp, currency notes or bank notes, with the specified knowledge and intent.
What is the punishment under BNS Section 180?
Imprisonment of either description for up to seven years, or fine, or both.
Is mere possession of a fake note enough for conviction?
No. The prosecution must establish the statutory knowledge or reason to believe and the intention that the counterfeit item be used as genuine.
Does IPC Section 489C still apply after 1 July 2024?
For conduct occurring before the commencement of the BNS, the IPC may remain relevant subject to applicable repeal, savings and transition rules. The BNS generally governs conduct from 1 July 2024.
Official statutory references
Read the official text of the Bharatiya Nyaya Sanhita, 2023 on India Code and the India Code legislation database. For information on counterfeit bank notes, see the Reserve Bank of India.
Legal information only. For a particular prosecution or defence, examine the operative statutory text, evidence and applicable procedural law.