What do you understand by the term ‘Good Faith'. Explain as per the provisions of the General Clauses Act, 1897.

CA Intermediate · Corporate and Other Laws · MTP · January 2025
What do you understand by the term ‘Good Faith'. Explain as per the provisions of the General Clauses Act, 1897.

Suggested Answer and Working Notes:

Good Faith: According section 3 (22) of the General Clauses Act, 1897, a thing shall be deemed to be done in “good faith” where it is in fact done honestly, whether it is done negligently or not. The question of good faith under the General Clauses Act is one of fact. It is to determine with reference to the circumstances of each case. The term "Good faith” has been defined differently in different enactments. This definition of the good faith does not apply to that enactment which contains a special definition of the term “good faith” and there the definition given in that particular enactment has to be followed. This definition may be applied only if there is nothing repugnant in subject or context, and if that is so, the definition is not applicable.

Topics: The General Clauses Act, 1897

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