GULAB C. GUPTA,J. ( 1 ) APPLICANTS, accused persons summoned to appear before the Additional Chief judicial magistrate, Bilaspur in Cr. Case No. 365/1987 to face trial for offence punishable under Section 420 I. P. C have approached this Court invoking its inherent jurisdiction under Section 482 Cr. P. C. , submitting that proceedings in the aforesaid Criminal Case amount to gross abuse of process of law and should, therefore, be quashed. ( 2 ) APPLICANT No. 1, Vinod Doshi is the Chairman and applicant No. 2, Rakesh Mehta the Market Development Executive of M/s. Premier Automobiles Ltd. , a public limited company engaged in manufacture and sale of Premier Cars in the Country. M/s. National Garage, a registered partnership firm of Raipur, is the duly authorised dealer of the aforesaid company for Chhattisgarh Region and Non-applicants Heeralal Shah and T. S. Chawhan represent the said partnership firm at Raipur and Bilaspur respectively. Respondent. Santosh A wasthy filed a complaint before the Additional Chief Judicial Magistrate, Bilaspur on 20th April, 1987 alleging commission of Criminal offence punishable under Section 420 I. P. C. by the applicants and respondent Nos. 3 and 4. The said Non-applicant submitted that he was an Industrialist at Bilaspur and needed a Premier Padmini car for his business purpose. He alleged that on 112-1987 the applicants and respondent No. 3 had come to Bilaspur and were available at the Branch Office of M/s. National Garage at link road, Bilaspur. According to the complaint, the branch office of M/s. National Garage at Bilaspur was newly established and was interested in promoting sale of the car in the area. The complainant claims to have met the applicants and respondents No. 3 and 4 and expressed his desire to purchase a car for his use. According to the complainant, the applicants disclosed a scheme to him and other purchasers wherein payment of total price of the car in lump sum before hand would entitle him to the car delivered within 10 days. The complainant further alleged that since he was interested in getting the car within 10 days, he paid the entire price including the cost of transportation on 12-2-1987. The complainant further alleged that since he was interested in getting the car within 10 days, he paid the entire price including the cost of transportation on 12-2-1987. The complainant alleged that the applicants, after having obtained the total price from him and others, did not deliver the car within 10 days as promised and thereby committed the offence punishable under Section 420 I. P. C. , The complainant relied on documents disclosed in the complaint and also furnished a list of witnesses which he would examine to support his case. It appears that the learned Magistrate examined the complainant on 20-41987 and fixed the case for 23-4-1987 to decide whether to register the complaint or not. On 23-4-1987 the learned Magistrate heard arguments of the learned counsel for the complainant and held that the statement of the complainant and documents disclose prima facie commission of offence under Section 420 I. P. C. and ordered, issue of process against applicants and non-applicants Nos. 3 and 4. It is, this order which is impugned in this application. ( 3 ) THE submission most vehemently pressed for consideration of this Court by the learned Counsel for the applicants is that the complaint does not, even prima facie, disclose commission of an offence under Section 420 I. P. C. and, therefore, the applicants could not be summoned to face the trial. It is also submitted that a fair reading of the complaint would at the most, show existence of a dispute of civil nature and hence the learned Magistrate should not have taken cognizance of the same. The learned Counsel for the respondent complainant, however, supported the impugned order and submitted that no case whatsoever exists for exercising extra, ordinary jurisdiction under Section 482 Cr. P. C. ( 4 ) COMPLAINANT alleges that all 4 accused persons were present at Bilaspur on 11-2-1987 and promised delivery of car within 10 days of payment of price and transport charges. Complainant Santosh Awasthy has supported these allegations by his statement on oath. That the car was not delivered within 10 days of payment of price to N. A. No. 4 is also stated in the complaint and supported by the sworn testimony. Whether these facts, prima facie, disclose commission of offence punishable under Section 420 I. P. C. ? Cheating, as defined in Section 415 I. P. C. is the first requirement of this offence. Whether these facts, prima facie, disclose commission of offence punishable under Section 420 I. P. C. ? Cheating, as defined in Section 415 I. P. C. is the first requirement of this offence. Where there is no cheating, there can possibly be no offence under this Section. (See Jageshwar Singh Rastogi v. State of M. P. and Prem Pandit and others v. Mahesh Garg2. In order to constitute cheating, deceiving as well as fraudulent and dishonest inducement by the applicants must be established as they are basic and essential elements of the offence. The Complaint and the statement of N. A. Santosh Awasthy should, prima facie, disclose these essential elements. Deceiving is to lead into error by causing a person to believe what is false or to disbelieve what is true. There is nothing either in the complaint or the sworn testimony of Santosh Awasthy from which deceit could be inferred. Criminal offence as disclosed in the complaint and statement consists of giving false hope of delivery of car within 10 days and thereby inducing the complainant to pay the entire price in advance. There is no allegation that any of the accused persons did any thing else. It is also not a case of unauthorised persons claiming to be authorised and obtaining advantage. It is well known that demand of Premier Padmini car out-strips its supply and, therefore, customers are willing to pay the entire price in advance. In such situation, it is not possible to infer deceit on the part of the applicants only because of payment of full price in advance. The promise to effect delivery within 10 days, even if made, would also not be sufficient to infer fraudulent representation in the context of particular fact situation. In the absence of deceit or fraudulent representation, essential ingredient of Section 415 I. P. C. would remain wanting. ( 5 ) SECTION 420 I. P. C. requires something more. For a person to be convicted under this provision it has to be established that not only he cheated some one, but also that by doing so he has dishonestly induced the person who was cheated to deliver any property or do any other act mentioned in the Section. The complainant Santosh Awasthy, according to the complaint, needed the car for his business. The complainant Santosh Awasthy, according to the complaint, needed the car for his business. It is, therefore, not a case where some one who did not need the car has been induced to purchase one. The question whether he would have not booked the car and not paid its entire price, if he was not promised its delivery within 10 days becomes important in such a fact situation. Then the complainant Santosh A wasthy is notfirmabout 10 days delivery. In his statement para 1 he deposes that the accused persons told him that 8-10 days time, which is normally taken in transporting the car from Daman to Bilaspur would be the delivery time; but in para 2 he states that promise was to deliver the car before budget and at pre-budget price. The budget as is well known, is presented on 28th February each year and hence promised time of delivery, in the present fact situation, would be 16 days. In view of this statement, letter dated 8- 4-1987 from N. A. No. 4 assumes importance. This letter was filed and proved by the complainant and informs him that cars are being delivered from Daman strictly as per booking. The complainant does not seem to have protested on this statement. These facts prima facie show that there was no promise as such to effect delivery within 10 days and hence no question of dishonestly inducing the complainant to pay full price of the car would arise. ( 6 ) IN Tulsiram v. State of U. P. 3, the Supreme Court considered the meaning and scope of Section 420 I. P. C. and held that not only cheating but also that by so doing the accused, dishonestly induced the person who was cheated to deliver the property must be proved to hold a person guilty. A person can, according to Supreme Court be said to have done a thing dishonestly if he does so with the intention of causing wrongful gain to one person or wrongful loss to another person. Wrongful loss is the loss by unlawful means of property to which a person is entitled while wrongful gain to a person means a gain to him by unlawful means of property to which the person gaining is not legally entitled. In as offence under Section 420 I. P. C. , according to Supreme Court, a pecuniary question necessarily arises. Wrongful loss is the loss by unlawful means of property to which a person is entitled while wrongful gain to a person means a gain to him by unlawful means of property to which the person gaining is not legally entitled. In as offence under Section 420 I. P. C. , according to Supreme Court, a pecuniary question necessarily arises. Where no pecuniary question arises the leament of dishonestly need not be stablished and it would be sufficient to establish that the act was fraudulent. Where the act is fraudulent, intention to cause injury to the person defrauded must be established. But where the allegation is that a person has dishonestly induced another to part with property something different has to be considered and that is whether he has thereby caused a wrongful loss to the person who parted with the property or has made a wrongful gain to himself. Application of this law to the present fact situation would justify the conclusion that no offence as alleged is made out. The complainant has not paid any thing more than the real price. Infact, by purchasing the car at Daman, he has saved about Rs. 3,000/- and hence there is no wrongful loss to him or wrongful gain to the applicants. There is also nothing on record to hold that but for the promised delivery within 10 days, cars would not have been sold. Indeed, it is complainants own Case that there were more buyers than the cars and hence no special efforts were needed to sell those cars. ( 7 ) THE aforesaid discussion leads to the inevitable conclusion that facts disclosed in the complaint and the statement of N. A. Santosh Awasthy do not constitute offence under Section 420 I. P. C. and hence there is no justification for summoning accused persons under Section 204 Cr. P. C. to face trial. This conclusion would lead to further conclusion that there is no sufficient ground for proceeding and hence the complaint must be dismissed under Section 203, Cr. P. C. The words sufficient ground for proceedingt have been construed to mean the satisfaction that a prima facie case is made out against the person accused by the evidence of witnesses entitled to a reasonable degree, of credit and not sufficient ground for the purpose of conviction. P. C. The words sufficient ground for proceedingt have been construed to mean the satisfaction that a prima facie case is made out against the person accused by the evidence of witnesses entitled to a reasonable degree, of credit and not sufficient ground for the purpose of conviction. R. G. Ruia v. State of Bombay4, and Nirmaljit v. State of West Bengal5. In J. P. Sharma v. Vinod Kumar Jam6 the Supreme Court held that where taking the allegations and complaint as these were, without adding or sub-stracting anything, if no offence is made out, the High Court would be justified in quashing proceeding in exercise of its powers under Section 482 Cr. P. C. Though these powers are to be used very sparingly and under compelling circumstances, absence of prima facie case is sufficient justification for their exercise. In this view of the matter, there is no impediment in this Courts exercise of its jurisdiction under Section 482 Cr. P. C. and quash proceedings against the accused persons. ( 8 ) THIS Court is also not satisfied that the learned Magistrate has acted in accordance with law in taking cognizance of the complaint and issuing summons. Order-sheet of the case discloses that the learned Magistrate has exercised powers under Section 204 Cr. P. C. and issued summons to the accused persons to appear before him. Section 204 Cr. P. C. prescribes the stage subsequent to taking cognizance of the complaint. The cognizance is taken under Section 190 Cr. P. C. , Section 190 (1) (a) authorises a Magistrate to take cognizance of any offence upon receiving a complaint of facts, which constitute such offence. Though the expression take cognizance of any offencet is not defined in the Code, it has been interpreted as having a limited meaning and indicating the point of time when the Magistrate takes judicial notice of an offence. In D. Lakshminara yana v. Narayan7, it was held that before it can be said that the Magistrate has taken cognizance of any offence under Section 190 (1) (a), Cr. P. C. he must not only have applied his mind to the contents of the petition but must have done so far the purpose of proceeding in a particular way i. e. Section 200 and thereafter sending it for inquiry and report under Section 202 Cr. P. C. he must not only have applied his mind to the contents of the petition but must have done so far the purpose of proceeding in a particular way i. e. Section 200 and thereafter sending it for inquiry and report under Section 202 Cr. P. C. Though no formal action of any kind is necessary, application of mind by the Magistrate to the facts with the intention of initiating judicial proceedings constitute compliance of the provision. It is therefore, clear that taking cognizance of offence is not an empty formality and requires application of mind. Once the Magistrate takes cognizance, he has to proceed under Section 200 Cr. P. C. to examine the complainant and his witnesses and thereafter decide whether to conduct further inquiry under Section 202 Cr. P. C. If the examination of complainant and his witnesses prompts the Magistrate to postpone issue of process, he has to consider whether resort to Section 202 Cr. P. C. would be necessary. It is only thereafter that the Magistrate is empowered to decide whether there is sufficient ground for proceeding in the matter. If such examination shows absence of sufficient ground, the complaint is liable, to be dismissed under section 203 Cr. P. C. But if the conclusion of the Magistrate be that there is sufficient ground for proceeding further he may issue warrant or summons under Section 204 Cr. P. C. It is, therefore, clear that issue of process against accused persons is a part of judicial process and not an empty formality. It is, on the contrary, a very serious and sublime exercise casting duty on the Magistrate, First to apply his mind to the facts stated in the complaint before taking cognizance thereof, to ascertain whether it disclose commission of offence, Secondly to consider whether facts disclosed in the examination of the complainant and his witnesses constitute sufficient ground for issue of process or whether the matter needs further inquiry or investigation. In case of doubt, further inquiry before issue of process becomes the obligation of the Magistrate. It is only when the matter has been thoroughly investigated as aforesaid, that the third stage is reached when the Magistrate is required to apply his mind to the facts and circumstances of the case to ascertain whether there is sufficient ground to issue summons or warrants against accused persons and proceed further. It is only when the matter has been thoroughly investigated as aforesaid, that the third stage is reached when the Magistrate is required to apply his mind to the facts and circumstances of the case to ascertain whether there is sufficient ground to issue summons or warrants against accused persons and proceed further. The complaint under reference, has not passed through these three stages. The order sheet shows that on 20th April, 1987 the complaint was presented and the statement of the complainant recorded. Thereafter it was directed to be put upon 23-4-1987 for consideration whether it deserved to be registered. The learned Magistrate has used the word Panjiyant in his order, from which it appears that he had decided to postpone the issue of process against the accused person under Section 202 Cr. P. C. It was, therefore, necessary for him to consider whether it needed inquiry or investigation for purpose of deciding whether or not there is sufficient ground for proceeding. That the learned Magistrate was not clear about the existence of sufficient ground is apparent from the order sheet dated 20-4-1987. In such a situation he should have considered the necessity of further inquiry and investigation as provided under Section 202 Cr. P. C. Since the learned Magistrate had not done anything on the complaint on 20-4-1987, it may even be urged that he did not take congnizance of the complaint. As long as the mind was not applied to decide whether to proceed under Section 200 Cr. P. C. , it cannot be held that the cognizance of the complaint had been taken. Then there is nothing in the order sheet to indicate why witnesses cited by the complainant were not examined. The use of the word Tshallt in Section 200 Cr. P. C. indicates that the Magistrate is bound to examine witnesses; if any. May be the witnesses were not present and hence not examined. But there is no justification for not considering the necessity of further inquiry/investigation while postponing issue of process as required by Section 202 Cr. P. C. ( 9 ) THE object of inquiry and investigation under Section 202 Cr. P. C. is to ensure that no person is compelled to answer a criminal charge unless the Court is satisfied that there is prima facie case for proceeding and issuing the process against him. P. C. ( 9 ) THE object of inquiry and investigation under Section 202 Cr. P. C. is to ensure that no person is compelled to answer a criminal charge unless the Court is satisfied that there is prima facie case for proceeding and issuing the process against him. The object of this inquiry was clarified by the Supreme Court in Chandra Deo Singh v. Prakash Chandra Bose8, Prematha Nath Talukdar v. Saraj Ranjan Sarkar9 and Vadilal Panchal v. Dattatrava10. These decisions, without doubt establish that it is the bounden duty of the Magistrate to elicit all facts not merely with a view to protect interest of the accused persons but also with a view to bring to book a person or persons against whom grave allegations are made. The inquiry or investigation is, therefore, designed to afford the Magistrate an opportunity of either confirming or removing any hesitation, he may feel in issuing process against the accused and to form an opinion as to whether process should be issued or not. Though the nature of inquiry varies with the circumstances of each case and it need not be exhaustive like a regular trial. It must be sufficient to collect adequate material upon which a rational decision could be founded. It is, thus apparent that even reasonable defences may require consideration at this stage. Sub-Section (1) of Section 202 indicates that though the Magistrate may have to depend. on facts alleged in the complaint at the time of taking its cognizance, he is not obliged to depend only on the complainantts help in the matter while deciding whether or not there is sufficient ground for proceeding further with the complaint. At this stage the Magistrate has the discretion either to rely on the statement of complainant and his witnesses, if he thinks fit or direct an inquiry into the case to be held by him or an investigation to be made by any police officer or any other person. Though the expression if he thinks fit vests the discretion in the Magistrate whether or not an inquiry under this Section should be made or an investigation ordered, the discretion has to be judicially exercised and in a manner so as to achieve the object and purpose of the provision. Though the expression if he thinks fit vests the discretion in the Magistrate whether or not an inquiry under this Section should be made or an investigation ordered, the discretion has to be judicially exercised and in a manner so as to achieve the object and purpose of the provision. It may, therefore, be necessary for the Magistrate to consider the intrinsic quality of the statement made before him with reference to the essential ingredients of the alleged offence. It is only when the Magistrate is satisfied that sufficient grounds exist for proceeding further in the matter that he can issue process and not otherwise. ( 10 ) IN this connection powers of a police officer to investigate commission of a cognizable offence may also be noticed to understand the nature, scope and object of investigation by him. Reference to Chapter XII of the Cr. P. Code would indicate that a police officer is not required to rely on the statement of the complainant and his witnesses alone, but is under an obligation to make detailed inquiry to ascertain whether it would be lawful to put the accused person to trial. For this purpose, the police officer is authorised to record the statement of accused persons and make such other investigation as he may consider necessary. It is well known that a crime is an offence against the society and, therefore, it is the obligation of the police to bring the culprit to book. The procedure in Chapter XV is an alternative procedure and therefore, it is only reasonable that the inquiry or investigation is done with the same object and purpose as the investigation by the police officer. The obligation of the Magistrate to see that no innocent person is put on trial and made to face apparently false and fabricated charges, makes it necessary for him to be thorough in the matter and ascertain sufficient grounds by considering all possible aspects of the case. To separate unfounded from substantial cases at the out set and to prevent innocent persons from being brought before him and subjected to annoyance of fabricate charge should, therefore, be the obligation of the Magistrate under this provision. To separate unfounded from substantial cases at the out set and to prevent innocent persons from being brought before him and subjected to annoyance of fabricate charge should, therefore, be the obligation of the Magistrate under this provision. ( 11 ) IF the aforesaid be the true nature, scope and object of the inquiry or investigation it must, in the context of the facts and circumstances of the present case, be held that the learned Magistrate has not exercised his discretion judicially and has not proceeded in the matter in accordance with law. The learned Magistrate was apparently not clear in his mind about the future course of action on 20-4-1987 when he recorded the statement of complainant and that is why he postponed the issue of process and required the Advocate of the complainant to make oral submission on 23-4- 1987. On 23-4-1987, the learned Magistrate apparently missed Section 202 Cr. P. C. and, therefore, did not consider either its utility or requirement. Not even the documents which were filed with the complaint were taken into consideration. Then the learned Magistrate readily accepted the complainants statement about presence of applicants at Bilaspur without subjecting the same to any scrutiny. He has also not considered whether it was possible for anyone to effect delivery of the car within 10 days at Bilaspur from the date of deposit of money. Then the question whether the date of deposit would be the deposit with the non-applicant No. 4 at Bilaspur or with Premier Automobiles Ltd. , Daman in whose name the bank draft was admittedly drawn was also missed. If the letter dated 8-4-1987 addressed by respondent No. 4 to the complainant had been perused, the learned Magistrate might have wanted to know when actually the Premier Automobiles Ltd. , Daman received the money. The complaint has been filed on 20-4-1987 i. e. within 12 days of writing this letter. If M/s. Premier Automobiles Ltd. , Daman had effected delivery within 10 days of the receipt of the money by them, the question whether there was any intention to cheat would have become important All these questions have direct bearing on the criminality alleged against the applicants and should have been clarified. It is therefore, apparent that the learned magistrate acted in hot haste and in complete disregard of Section 202 Cr. P. C. in proceeding further in the matter. It is therefore, apparent that the learned magistrate acted in hot haste and in complete disregard of Section 202 Cr. P. C. in proceeding further in the matter. It is also apparent that the learned Magistrate did not exercise his discretion judicially and, therefore, failed to protect the interest of applicants which was his obligation under Section 202 Cr. P. C. The impugned order, therefore, suffers from a serious illegality and causes failure of justice as its necessary consequence. It is, therefore, the obligation of this court to quash the impugned order dated 23-4-1987 and remit the matter to the learned Magistrate to reconsider the same in accordance with law. ( 12 ) FOR the reasons aforesaid, the application succeeds and is allowed. The impugned order dated 23-4-1987 issuing process against the applicants is hereby quashed and the matter is remitted to the learned magistrate for proceeding in the matter in accordance with law with due advertence to the observations made aforesaid. Application allo wed. .