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How does the General Clauses Act, 1897 define 'good faith' in Section 3(22)?
Answer & Solution
Correct answer: A.
1. Section 3(22) defines: '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**.'
2. This is a more **liberal** definition of good faith than the one in the Indian Penal Code or the Limitation Act.
3. **IPC** — a thing is NOT deemed to be done in good faith if done negligently, even though honestly.
4. **Limitation Act, 1963 (Section 2(7))** — nothing will be deemed to have been done in good faith which is not done with due care and attention.
5. So under the GCA, honesty alone is sufficient; under IPC and Limitation Act, due care is also required.
_Source: ICSI CS Executive — Lesson 4, Definitions §3(22), p. 104._
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