The denominational numeral in latent, see-through Devanagari script, electrotype watermarks, colour-changing ink, and the orientation and relative positioning of Mahatma Gandhi on a ₹500 currency. I know this and maybe you do too and so does everyone who has ever been involved with counterfeiting currency. After all when one knows the differentiating features then it’s not difficult to reproduce the original with minimum negligible flaws.
Counterfeit currency is the result of producing money without proper legal sanctions of the authorised government, the Reserve Bank of India in case of our country. These are produced with the intent to deceive the recipient, because once caught, the one in its actual possession will be answerable.
Constant accretion of circulating counterfeits with an escalating trend in a scattered manner is a blight for the integrity and reliability of the management system of the currency notes as it would vitiate the currency, coinage system, and payment procedure norms.
Counterfeiting, according to some experts is the second oldest profession as it to almost the time when money was invented. From the times of the golden age of Akbar’s rule to the circulation of fake currency in the adversary’s economy, counterfeiting has often been used as a technique of warfare. Today, terrorism, illegal activities such as smuggling, money laundering involve counterfeiting. The only difference between the present days and the past is the advancement of the technology. With the tremendous progress in science, every day, it has become easier to account for the unknown stock of counterfeits at any point of time depending upon the quantum of counterfeit notes getting inducted into the economic wheel of the country, as well as the length of time they circulate before its elimination by the law enforcement agencies. The bottom line is that, it was a punishable offence then and it still is because it has the potential capability of disintegrating the economy of the country. For instance, back in the 13th century when China had introduced paper notes for the first time, using of mulberry wood, the punishment for counterfeiting was death. However, since every “coin” has two sides, with the advent of technology, it also became easy to forge currency with the help of the growing computer-aided expertise and equipment.
COUNTERING COUNTERFEITING: INDIAN LAWS
Counterfeiting of Currency notes or forging money is a serious criminal offence because of the value conferred on money and the high level of technical skill and precision required to replicate it. If a counterfeit or faked note in circulation and remains undetected, it becomes a part of the financial system. Moreover, it adds to the tax burden of the public in favour of the counterfeiter. It increases prices by the percentage that the value of the counterfeit note bears to the total stock of money in the economy. Today, many counterfeit notes are in circulation have entered the monetary system and pose a great threat to our economy.
The Indian Penal Code under sections 489A, 489B, 489C and 489D, recognizes and penalizes the counterfeiting of currency. Section 489A expressly provides for imprisonment for life or a term which may extend to ten years. Further using, buying, selling, receiving, trafficking the counterfeit currency with the knowledge of the same being fake is punishable with life imprisonment or a term which may extend to ten years under section 489B. Moreover, a person with mere possession of such counterfeit currency is liable for an imprisonment of a term which may extend to seven years or a fine or both under section 489C, provided that at the time of possession he was in complete knowledge that the money in his possession was fake. The IPC also penalizes the persons involved in the manufacturing processes of such fake money including possessing, buying, selling, receiving any instrument or equipment required for the purpose of such manufacturing with a maximum seven-year imprisonment or fine or both.
Apart from IPC, Section 94 of the Code of Criminal Procedure also gives the concerned authorities the power to search any premises which is suspected to contain such counterfeit currency.
Section 3 of the Prevention of Money-laundering (Maintenance of Records) Rules, 2005 also provides for maintenance of records of all cash transactions where forged or counterfeit currency notes or bank notes have been used as genuine or where any forgery of a valuable security or a document has taken place facilitating the transactions.
Recently the Unlawful Activities (Prevention) Amendment Bill had been introduced in the Lok Sabha proposing that the National Investigation Agency should be empowered to investigate offences related to counterfeit currency or banknotes.
The menace of counterfeiting currency has been ever increasing. There have been numerous cases over the years wherein gangs and rackets have been busted by the government investigation agencies. One of the recent cases in 2019, included two persons from Karnataka, convicted under Section 489B (using as genuine, forged or counterfeit currency-notes), 489C (possession of forged or counterfeit currency/bank-notes) and 120B (criminal conspiracy) of the Indian Penal Code. They were initially caught with the possession of fake currency valuing ₹10,20,000. It was revealed in successive investigations that the accused along with their associates had hatched a criminal conspiracy for procuring and circulating Fake Indian Currency Notes (FICN) in India which was procured from Bangladesh via Indo-Bangladesh International border.
As of now, India does not have a separate legislation that specifically deals with counterfeiting of currency. In a time where technology can be dangerously advantageous, the introduction of a law that regulates and keeps a check on crimes involving counterfeit currency is essentially a priority.