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CMA Foundation · Fundamentals of Business Laws and Business Communication · Capacity of Parties, Free Consent

Which of the following is listed in Section 17 as an act of fraud when committed with intent to deceive or induce another party to enter into a contract?

A promise made without any intention of performing it is fraud under Section 17, provided it is made with intent to deceive or induce the other party to contract. Honest statements and mere silence without a duty to speak do not amount to fraud.

  1. AA promise made without any intention of performing itCorrect
  2. BA statement made honestly believing it to be true
  3. CMere silence about a fact where there is no duty to speak
  4. DAn opinion that later turns out to be wrong

Explanation

Section 17(3) includes a promise made without any intention of performing it. An honest but wrong statement lacks the required belief in falsity, so it is not fraud. Mere silence is expressly excluded by the Explanation unless there is a duty to speak or the silence equals speech.

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