Order.- Accused 1, 3 and 4 in C.C. No. 57 of 1975 on the file of the Chief Judicial Magistrate, Madurai, have filed this petition requesting this Court to invoke its extraordinary powers under section 482, Criminal Procedure Code, and to quash the charges framed against them in the above said case. 2. In the petition filed by them it is averred that a private complaint under section 420, Indian Penal Code, was filed by the first respondent herein (complainant) against (1) one K. Gupta Flour and Oil Industries, represented by Ramakaran Das Gupta, Akda and (2) Shri Krishna Sharma Oil Mills, represented by the first petitioner herein,Ratanlal Sharma, Akola, before the Chief Judicial Magistrate, Madurai, alleging as follows: Both the accused are doing business at Akola, Maharashtra and are having business dealing with the complainant and in that capacity, the said Ramakaran Das Gupta sent a representative, one Madanlal Sharma, to the complainant, requesting him 10 purchase 2750 bags of Uganda cotton seeds and despatch the same by rail against his permits to Akola. Though the permits were not sent, the representative Madanlal insisted upon the purchase and accordingly the first respondent there in purchased the quantity and stored the same at Theni in Madurai district and at Rajapalayam, Ramanathapuram District. This was in August, 1974. Thereupon, on further ordersin September, 1974, the complainant purchased 100 bags of the said variety and stored them in his godown at Madurai. The permits were received from the said Ramakaran Das Gupta in October, 1974 by the first respondent for about 1250 bags. Meanwhile, the first petitioner herein (Ratanlal Sharma) placed orders for 15 wagons of the same variety to be despatched and also sent the permits. The goods were despatched to the first petitioner from Trichy and Salt Coaturs as wagons from Madurai were not available. When the said goods arrived at Akola, the first petitioner refused to take delivery of the goods due to the fall in the prices of cotton seeds. Hence, the first respondent went over to Akola to settle the matters. Inspite of repeated demands made by the first respondent, the first petitioner refused to take delivery of the goods when consigned. When the said goods arrived at Akola, the first petitioner refused to take delivery of the goods due to the fall in the prices of cotton seeds. Hence, the first respondent went over to Akola to settle the matters. Inspite of repeated demands made by the first respondent, the first petitioner refused to take delivery of the goods when consigned. In order to avoid loss and demurrage, Ramakaran Das Gupta was requested by the first respondent to take delivery of the cotton seeds which were consigned to the first petitioner, which request Ramakaran Das Gupta refused to comply with, in collusion with the first petitioner, and imposed a condition on the first respondent that unless the latter gave a letter in writing that all prior contracts to both of them stood cancelled and the first respondent would not take any action against the first petitioner, Ramakaran Das Gupta would not take the goods. As the first respondent had no other alternative to agree to the conditions imposed by Ramakaran Das Gupta, the first respondent, under duress and coercion, wrote a letter, dated 26th October, 1974 as per the condition imposed by Ramakaran Das Gupta. On receiving the letter, Ramakaran Das Gupta purchased the cotton seeds at the prevailing market rate which was considerably lower than the contract price. Thus, the first respondent sustained a considerable wrongful loss in the above-said transaction. Thereupon, the first respondent sold the goods to Das Gupta sent on behalf of the first petitioner treating it as a separate transaction over and above the goods lying at Madurai, purchased on behalf of Das Gupta, and not instead on the goods purchased on behalf of the said Das Gupta, which were lying in the first respondent’s godown. Thus, he would complain that the first respondent who was acting on the dishonest and fraudulent representations made by the two persons mentioned in the complaint, had to purchase the Uganda cotton seeds in large quantities at the then prevailing prices and as a result of the unlawful and deliberate refusal of the said accused to take delivery of the same, was put not only to considerable loss monetarily but also had to suffer mental agony as well. Thus, the accused had acted in collusion with each other and had deliberately cheated the complainant and committed offences punishable under section 420, Indian Penal Code. Mr. Thus, the accused had acted in collusion with each other and had deliberately cheated the complainant and committed offences punishable under section 420, Indian Penal Code. Mr. C.K. Venkatanarasimhan, appearing for the petitioners, would submit that the Magistrate, after receipt of this complaint, ordered for an enquiry and report under section 156, Criminal Procedure Code. Respondent No. 2 after registering a case and investigating the same, filed a charge-sheet against five accused mentioned therein, viz., petitioners 1 to 3 herein (accused 1, 3 and 4 in the charge-sheet), Ramakaran Das Gupta (accused 2 in the complaint presented in Court) and one Madanlal Sharma (5th accused in the charge-sheet). Thereupon, the learned Chief Judicial Magistrate, on a perusal of the documents, discharged accused 2 and 5 mentioned in the charge-sheet, but framed charges against these petitioners for an offence under sections 420 and 384, Indian Penal Code. Hence this petition for quashing the proceedings. 3. Mr. C.K. Venkatanarasimhan, appearing for the petitioners, would submit that the non-taking of delivery of the goods and the execution of the letter were both at Akola in Maharashtra State and hence the lower Court has no jurisdiction to frame the charges. Secondly, he would contend that even assuming the entire facts to be true, it is very apparent that they do not constitute any criminal offence. Thirdly, according to him, the correspondence that passed between the parties; would show that there was neither any threat nor any coercion exerted on the complainant to execute the letter, dated 26th October, 1974 as alleged in the complaint. Finally, he would submit that the whole proceedings are an abuse of process of the criminal Court, intended to put the petitioners who are traders at Akola, to hardship and damages. 4. The petitioners filed a typed set of papers containing copies of letters and correspondence alleged to have passed between them, another set of which was furnished to the respondents. Though Mr. Seetharaman, learned Counsel appearing for the first respondent, does not raise any objection to these papers, 1 am not inclined to act upon them at this stage-without legal proof. The petitioners filed a typed set of papers containing copies of letters and correspondence alleged to have passed between them, another set of which was furnished to the respondents. Though Mr. Seetharaman, learned Counsel appearing for the first respondent, does not raise any objection to these papers, 1 am not inclined to act upon them at this stage-without legal proof. Moreover, I am not going into the question of the jurisdiction of the Court on the issue as to whether the offence was committed at Akola, Maharashtra State, or at Madurai where the first petitioner is said to have collected the materials and transported the same The main question for my consideration, even admitting the entire averments in the complaint to be true, is whether they would constitute any criminal offence. 5. Section 415, Indian Penal Code, defines what is cheating. To constitute art offence of cheating under this section, the following ingredients are to be proved. They are: (1) deception of any person, and thereby (2) (a) fraudulently or dishonestly inducing that person (i) to deliver any property to any person, or (ii) to consent that any person shall retain any property; or (b) intentionally inducing the person deceived to do or omit to do anything which he would not do or omit if he were not so deceived and which act or omission causes, or is likely to cause damage or harm to that person in body, mind, reputation or property, intention can only be gathered from the surrounding circumstances. The term "deceiving" is not defined in the section. Deception is an essential ingredient of an offence of cheating. A person is said to have been deceived when it is proved that he was induced to believe as true which was untrue. The evidence must establish the existence of a fraudulent or dishonest intention at the time of the commission of the act in respect of which the cheating is alleged. Therefore, the question, whether there was intention to deceive, must be answered at the date when the contract was made. If the accused had, at the time when he induced the complainant to part with the goods, promised to pay cash against delivery, then the fact that he did not pay would not by itself convert the transaction into one of cheating if the accused had intention to do so. If the accused had, at the time when he induced the complainant to part with the goods, promised to pay cash against delivery, then the fact that he did not pay would not by itself convert the transaction into one of cheating if the accused had intention to do so. But, it must be shown that he had no intention whatsoever to pay but merely said that he would do so in order to induce the complainant to part with the goods. Only in that contingency, a case of cheating would be established. 6. Mere breach of contract, as I find in the instant case, cannot give rise to a criminal prosecution. The distinction between a case of mere breach of contract and one of cheating depends upon the intention of the accused at the time of the alleged inducement which of course, may be adjudged by the subsequent conduct. Coming to the actual crux of the case, the complaint reads as follows: "When the goods reached Akola, the second accused (1st accused-1st petitioner herein) refused to take delivery of the goods due to the fall in the price of cotton seeds. The above allegation would by itself prove that at the time when the goods were consigned from this state to the first petitioner, the first petitioner did not have any intention to induce the complainant to part with the goods, and the refusal to take delivery of the goods is due only to the fall of the price of cotton seeds. Under these circumstances, I hold that the refusal on the part of the first petitioner to take delivery of the goods is due to the intervening circumstance that arose between the time of the placing of the order and the refusal to take delivery of the goods, viz., the fluctuation in price, and therefore it is not possible to infer from the circumstances alleged, that any deception has been practised by the petitioners. 7. Mr. C.K. Venkatanarasimhan, at this stage, would bring to my notice two decisions viz., P.N. Natatajan v. K.C. Gupta1and Hari Prasad v. Bishun Kumar2. The facts in the former case are very similar to those in the present case. 7. Mr. C.K. Venkatanarasimhan, at this stage, would bring to my notice two decisions viz., P.N. Natatajan v. K.C. Gupta1and Hari Prasad v. Bishun Kumar2. The facts in the former case are very similar to those in the present case. In that case, the application was filed under section 561-A, Criminal Procedure Code for quashing the proceedings pending in the Court of the Munsif-Magistrate, on the basis of a complaint for an offence under section 417, Indian Penal Code. The complaint therein has been filed on the allegations that the accused, who was a merchant and commission agent, placed an order with the complainant for purchase of 220 quintals of Pea pulse, and for despatching the same to the accused at Palghat; that the complainant quoted the price and after its having been accepted by the accused, purchased the goods and despatched them through the railway; that hundies and railway receipts were sent through Bank, to be delivered to the accused on payment of the price of the goods; that the accused did not honour the hundies and take: delivery of the goods, in spite of the efforts made by the complainant, and that as in the meantime the market had gone down, the complainant suffered a loss to the extent of Rs. 1,500. On those allegations, the accused was charged with having committed an offence under section 417, Indian Penal Code. It was contended for the complainant that as the accused had ultimately refused to take delivery of the goods and honour the goods, it must be inferred that from the very beginning he had the intention of not honouring the hundies and not taking the delivery of the goods. On the above facts, it was observed as follows: "It may have been possible to draw such an inference from the conduct of the accused, if nothing had intervened. If the circumstances continue unaltered from the beginning till the end i.e., the status quo anto continues till the final act or omission by the accused, it may be possible to draw such an inference; but if the circumstances change and something intervenes in between the placing of the order and refusing to take the delivery of goods, it will not be possible to draw any such inference. In the complaint it has been stated that in the meantime the market had gone down. In the complaint it has been stated that in the meantime the market had gone down. If the accused had taken delivery of the goods at the rate contracted, the accused would have suffered a loss. It was this which could, and probably did, induce him to change his mind. As this is a new factor which came into existence after the placing of the order and before the tender of the goods, the inference sought to be drawn by the learned Counsel cannot be drawn." In the latter case, the facts were that the appellant therein filed a complaint against the two respondents on the allegation that the appellant was running business at Samastipur in Bihar and Calcutta; the respondents were known to the appellant and he had full faith in them; the appellant wanted to start some business and in that connection talked to the respondents, who then stated that they would start transport business and they also further stated that the appellant would be the proprietor of the Corporation (business) and the respondents would work as his agents; the appellant paid Rs. 35,000 to the respondents, and later when he went to Calcutta he found that the respondents were doing transport business but the appellant was not shown as the proprietor of that business; when remonstrated, they said they would got the Corporation registered and show the appellant as the proprietor and also agreed to settle the business accounts in December every year; despite the above commitment, they failed to render accounts and even afterwards despite the demanbs of the appellant, they failed to do so, and then the complaint was filed under section 420, Indian Penal Code; the respondents approached the High Court under section 561-A, Criminal Procedure Code. On the adove facts, the High Court was of the view that mere breach of contract could not give rise to criminal prosecution, and the appellant had a remedy in the civil Court. The observations made by the Supreme Court therein while confirming the judgment of the High Court, would be relevant: "For the purpose of the present appeal, we would assume that the various allegations of fact which have been made in the complaint by the appellant are correct. The observations made by the Supreme Court therein while confirming the judgment of the High Court, would be relevant: "For the purpose of the present appeal, we would assume that the various allegations of fact which have been made in the complaint by the appellant are correct. Even after making that allowance, we find that the complaint does not disclose the commission of any offence on the part of the respondents under section 420, Indian Penal Code. There is nothing in the complaint to show that the respondents had dishonest or fraudulent intention at the time the appellant parted with Rs. 35,000. There is also nothing to indicate that the respondents induced the appellant to pay them Rs. 35,000 by deceiving him. It is further not the case of the appellant that a representation was made by the respondents to him at or before the time he paid the money to them and that at the time the representation was made the respondents knew the same to’ be false. The fact that the respondents subsequently did not abide by their commitment that they would show the appellant to be the proprietor........and would also render accounts to him in the month of December, might create civil liability for them, but this fact would not be sufficient to fasten criminal liability on the respondents for the offence of cheating.“ In view of the observations made in the above two decisions, I am of the view that there is nothing in the complaint in the instant case to show that the petitioner had the dishonest or fraudulent intention at the time the first respondent parted with the goods, nor did the complaint indicate that the petitioners had induced the first respondent to part with them. The mere fact that the petitioners did not abide by their commitment as to the placing of the order for the goods would not fasten them with criminal liability. 8. The next charge for the offence under section 384, Indian Penal Code, is only one incidental to the main offence under section 420. When the main offence goes, this charge also has to fail. 9. Mr. Sitaramam, appearing for the first respondent, has not placed any material before me for sustaining” these charges. 8. The next charge for the offence under section 384, Indian Penal Code, is only one incidental to the main offence under section 420. When the main offence goes, this charge also has to fail. 9. Mr. Sitaramam, appearing for the first respondent, has not placed any material before me for sustaining” these charges. The learned Public Prosecutor, appearing for the State-the second respondent, would also fairly concede that the materials placed before the Court are not sufficient to sustain any of the charges. 10. Under these circumstances, I have no other option but to quash the proceedings by invoking the inherent power of this Court under section 482, Criminal Procedure Code. The petition is accordingly allowed and the impugned proceedings and the charges, framed are quashed.