JUDGMENT : B.K. Behera, J. - These four Criminal Miscellaneous Cases involving similar questions of facts and points of law have been heard together and will be governed by this common order. The Petitioners invoke the inherent jurisdiction of this Court u/s 482 of the Code of Criminal Procedure (the 'Code', for short), to quash the criminal proceeding against them for criminal breach of trust and abetment thereof punishable u/s 409 of the Indian Penal Code in four complaint cases in which cognizance has been taken by the learned Subdivisional Judicial Magistrate, Jeypore, after the Petitioners of complaint were made by the complainant-opposite parties and their statements were recorded u/s 200 of the Code. The grounds taken by the Petitioners are that the disputes between the parties are purely of a civil nature and in the absence of any prima facie material that the Petitioners had been guilty of criminal breach of trust, the learned Subdivisional Judicial Magistrate went wrong in taking cognizance of the offences against them. Originally the Chit Fund, namely, 'Digvijaya Chit Fund' represented by its manager, had been made one of the opposite parties by the Petitioners, but notice on that opposite party was dispensed with in each of these cases, as prayed for by the Petitioners, at their risk. 2. Mr. C.A. Rao, the learned Counsel for the Petitioners, has referred to the complaints and the initial statements of the opposite-parties recorded by the learned Subdivisional Judicial Magistrate and has filed the sample copy of the Pass Book which had been handed over to each of the opposite parties whose moneys deposited in trust with the Petitioners had allegedly been misappropriated, the copy of the application with the list of assets and liabilities of the chit fund filed before the Hon'ble Company Judge of this Court for liquidation and the certified copy of the order passed by the learned Company Judge and has submitted that no criminal action could be taken against the Petitioners and the opposite parties could approach the Official Liquidator for payment of their dues. He has contended that as the disputes are purely of a civil nature, no prosecution could lie and, therefore, these are fit cases in which this Court should quash the criminal proceedings against the Petitioners. Mr. He has contended that as the disputes are purely of a civil nature, no prosecution could lie and, therefore, these are fit cases in which this Court should quash the criminal proceedings against the Petitioners. Mr. R.K. Patra, the learned Counsel for the opposite parties, has submitted that the materials on the basis of which cognizance had been taken prima facie showed that the Petitioners had committed criminal breach of trust by misappropriating the amounts deposited with them and these are not fit cases where the inherent jurisdictions of this Court should be exercised to quash the proceedings, as this power is to be exercised in the rarest of rare cases. The learned Counsel for both the sides have invited my attention to the principles laid down in a number of decisions of the Supreme Court and this Court as to when the inherent jurisdiction of the High Court is to be exercised. 3. The allegations made against the Petitioners were that they started a chit fund in the name of 'Digvijaya Chit Fund' of which the Petitioners Nos. 1 to 6 were the managing partners, the Petitioner No. 4 was the manager and the Petitioner No. 7 was the Bill Collector who used to collect subscriptions. The Petitioners, it was alleged, persuaded the opposite parties to enrol themselves as members and believing in good faith that they would be benefited by the investment, the opposite parties enrolled themselves as the members for a period of forty months and paid subscriptions. Had the last instalment been collected, the opposite parties would have completed the groups, but the Petitioner No. 7 did not turn up for collection. When the opposite parties went to the office and approached the Petitioners to receive the last instalment, they declined to receive saying that the funds of the firm had been misappropriated and the accounts of the firm were being checked up and they gave out that they would accept the last instalment as and when the matter would be settled up. After waiting for sometime, the opposite parties went to the office of the chit fund and found that the office had been locked and the chit fund had been abolished. Each of the Petitioners levelled allegation of misappropriation of funds against the other. On verification, it was found that no balance had been left in the bank accounts of tale film. Each of the Petitioners levelled allegation of misappropriation of funds against the other. On verification, it was found that no balance had been left in the bank accounts of tale film. The opposite parties contacted the other members of their groups and learnt that they had also not been paid their dues. The Petitioners had converted the moneys to their own use and had thus committed criminal breach of trust. After the initial statements of the opposite parties were recorded, the learned Subdivisional Judicial Magistrate took cognizance of the offences. In I.C.C. 27 of 1980 and I.C.C. 46 of 1980 out of which Criminal Miscellaneous Case Nos. 448 and 550 of 1980 respectively arise, cognizance has been taken against all the Petitioners in respect of the offence punishable u/s 409 and in I.C.C. 40 of 1980 and I.C.C. 41 of 1980 out of which Criminal Miscellaneous Case Nos. 449 and 450 of 1980 respectively arise, cognizance has been taken against the Petitioners in respect of the offence punishable u/s 409 read with Section 34 of the Indian Penal Code. 4. It is not disputed at the Bar that the Petitioner Nos. 1 to 6 were the managing partners and the Petitioner No. 7 was the collector of the subscriptions of the chit fund. The fact of deposits by the opposite parties of their subscriptions until the last instalments has not been disputed either at this stage. It would, however, be noticed from the copy of the application made by the Petitioner No. 3, who had styled himself as the Director of the chit fund made in this Court in Company Act Case No. 12 of 1979 under Sections 433, 434 and 439 of the Companies Act for the winding up of the chit fund that the assets and liabilities of the chit fund had been mentioned therein. After due notice was published in the Company Act case, the Hon'ble Company Judge allowed the application and directed that the chit fund, having its registered office in the district of Koraput, be wound up. The Official Liquidator was directed to take over the assets, accounts and registers of the firm. This order was passed on 14-1-1981. It may, however, be kept in mind that the application had been made under the Companies Act in the year 1979, i.e. much prior to the institution of the criminal proceedings against the Petitioners. The Official Liquidator was directed to take over the assets, accounts and registers of the firm. This order was passed on 14-1-1981. It may, however, be kept in mind that the application had been made under the Companies Act in the year 1979, i.e. much prior to the institution of the criminal proceedings against the Petitioners. As has been submitted by the learned Counsel for both the parties, in view of the pendency of the case under the Companies Act, no criminal prosecution could lie against the company and even the pending cases were not to be proceeded with as provided in Section 446 of the Companies Act. The learned Subdivisional Judicial Magistrate could not have been aware of this state of affairs as no enquiry was made by him into the complaint and as can be seen from the facts now placed before this Court, no prosecution could lie against the chit fund. 5. As to whether the criminal proceedings against the Petitioners are to be quashed by exercising the inherent jurisdiction of this Court, the principles settled by the Supreme Court and this Court may be kept in mind. A criminal proceeding shall ordinarily be proceeded with in accordance with law unless the allegations made in the complaint, even on their face value and if accepted fully, do not constitute an offence. The inherent power of this Court to quash a criminal proceeding is to be exercised to prevent an abuse of the process of the Court or to secure the ends of justice. At the time of taking cognizance, the Magistrate is restricted to finding out whether there is a prima facie case to proceed against an accused person and he is not supposed to enter into a detailed discussion of the merits and demerits of the case. While examining as to whether a criminal proceeding is to be quashed, the High Court cannot launch on a detailed examination of the case of merits. Whether there are sufficient materials to hold a person guilty of the offence is to be decided at the stage of trial and not while finding out as to whether there are materials to take cognizance and proceed against an accused person. In this connection, reference may be made to the principles laid down in R.P. Kapur Vs. The State of Punjab Hareram Satpathy Vs. In this connection, reference may be made to the principles laid down in R.P. Kapur Vs. The State of Punjab Hareram Satpathy Vs. Tikaram Agarwala and Others P. Vijayapal Reddy and Others Vs. The State Drugs Inspector, Palace Road, Bangalore Vs. Dr. B.K. Krishnaiah and Another Smt. Peelamedu Rajeswary Ramkrishna and Others Vs. B.N. Misra, and Ranjit Kumar Samantray and Others Vs. State of Orissa. It has been laid down by the Supreme Court in Sardar Trilok Singh and Others Vs. Satya Deo Tripathi that when the dispute is purely of a civil nature, initiation of a criminal proceeding is an abuse of the process of the Court. 6. As has been submitted by the learned Counsel for the Petitioners, each of the opposite parties was a non-prized subscriber and as per the terms contained in the Pass Book issued to each of such subscribers, he was to be paid his chit amount only after the payment of the last instalment and not prior to that. Although in the petition of complaint made by each of the opposite parties, the documents to be relied on had been mentioned and one of the documents was the Pass Book, none of these documents was filed by the opposite parties and the learned Subdivisional Judicial Magistrate had apparently not applied his mind to find out as to when the payment was due. Averments had, however, been made in the petitions of complaint by the opposite parties that the Petitioners had misappropriated the collected chit fund amounts for their own benefit. Save and except the statements of the complainant-opposite parties in this regard in the petitions of complaint and/or in their initial statements which were not quite consistent and needed a probe to find out if such allegations could be accepted, no other material had been placed before the Court in this regard. Although the Court is not to made a detailed and meticulous examination of the materials against an accused person at the stage of taking cognizance, cognizance of the offence is not to be taken mechanically without any application of mind. It is to examine the materials placed before it, apply its mind and find out as to whether cognizance should be taken. Taking cognizance is a legal and judicious act which sets criminal law in motion and a person is prosecuted thereafter. It is to examine the materials placed before it, apply its mind and find out as to whether cognizance should be taken. Taking cognizance is a legal and judicious act which sets criminal law in motion and a person is prosecuted thereafter. A court should, therefore, properly apply its mind which, as I see, had not been done in these four cases. On the facts of these cases and in view of the questions involved including the allegation of misappropriation, it would be necessary, in my view, to vacate the impugned orders to prevent an abuse of the process of the Court and to direct further enquiry into the complaints under the Section 202 of the Code. 7. In the result. I would allow the applications, set aside the orders passed in the four cases taking cognizance of the offences and direct the learned Chief Judicial Magistrate, Jeypore, to further enquire into the complaints and proceed in accordance with law. Final Result : Allowed