JUDGMENT Hon’ble Ram Surat Ram (Maurya), J.—Heard Sri G.S. Chaturvedi, Senior Advocate, assisted by Sri Sharique Ahmed, Sri Nitin Sharma, Sri Alok Chandra, and Km. Somya Chaturvedi, and Sri Navin Sinha, Senior Advocate, assisted by Sri Devansh Rathore, for the applicants and Sri Dilip Kumar alongwith Sri Vikas Tripathi, Sri Gaurav Agrawal and Sri Rajrshi Gupta, for opposite party-2. 2. These applications under Section 482 Cr.P.C. have been filed for quashing the summoning order and order of bailable warrant passed by Additional Chief Judicial Magistrate 1st, Gautam Budh Nagar dated 25.5.2015 and 2.7.2015, respectively in Complaint Case No. 1419 of 2015, J.K. Arora v. Alok Chandra and others, under Section 406, 420, 467, 468, 471, 120-B IPC, PS Badalpur, district Gautam Budh Nagar as well as entire proceeding of the complaint case. 3. Background facts, leading to this criminal case, in short, are as follows:- (a) Abdulaziz Al Tuwejri, Majid Abdulaziz Al Tuwejri and Badr Abdulaziz Al Tuwejri, citizens of Kingdom of Saudi Arabia, established a plant to manufacture non-mixed iron and steel ingot etc. at MODON Industrial Area, Al Ahsa, Saudi Arabia. They started business through a company SHARQIA (Al Sharqia Rolling Steel Factory Ltd.), incorporated under the laws of Kingdom of Saudi Arabia. They sold their company, including plants, machinaries, building, land, employees, staffs, customers, investors etc. by way of “Lease ended with Ownership Agreement” dated 29.7.2010 to World Mining Industry Ltd., a company incorporated under the laws of Kingdom of Saudi Arabia, for a total Saudi Riyals 57 million. Sale consideration was payable in 96 monthly installments from 15.11.2010 to 15.10.2018. Amount of installments were fixed in the agreement. (b) World Mining Industry Ltd., (hereinafter referred to as WMI) issued total 1250 Equity Shares (each share was of value SAR 1000/-). The applicants Surender Kumar Sham Lal purchased 265.625 shares, Alok Chandra purchased 265.625 shares, Tanvir Athar Bukhari purchased 265.625 shares, Anand Vardhan (beneficial owner of shares under transfer of Atam Prakash Sood) purchased 265.625 shares and one Alok Mittal purchased 125.000 shares and one Strategic Solution Public Contracting Est Company purchased 62.500 shares. These persons were “current owners” and were in actual control and management entire business of this manufacturing unit. After purchasing the unit, they began to manufacture its product and achieved production up to 1200 mt. per month on single shift basis. These persons were “current owners” and were in actual control and management entire business of this manufacturing unit. After purchasing the unit, they began to manufacture its product and achieved production up to 1200 mt. per month on single shift basis. Under the laws of Saudi Arabia, shareholders of the company are in the capacity of partners but their liability is up to extent of their share capital. (c) According to the applicants, Jagjiv Kumar Arora (opposite party-2) was in Saudi Arabia in June 2012, for his own work. Surender Kumar and his aforesaid business was known to him. As Jagjiv Kumar Arora was also in similar business, as such, he expressed his desire to visit and see the factory of the applicant to Surender Kumar. In this way Jagjiv Kumar Arora visited the factory premises of SHARQIA and thoroughly examined status of the company and business of the applicants. After examining and knowing about all the aspect of the applicants, he expressed his willingness to join the company. He gave allurement to the current owners that by investing in share capital, equal to the existing share capital, he would be able to enhance production of the company up to 3500 mt. per month. At that time, due to increasing demand of WMI’s products in market, the Company and current owners also realized the need of investment of more fund to enhance its production limit. WMI (the company), the current owners (the four applicants and two other shareholders) and Jagjiv Kumar Arora (opposite party-2), Director of Supreme Alloys Ltd. (an Indian Company) (as Strategic Partner) entered into an agreement dated 18.7.2012, in the shape of Memorandum of Understanding. (d) According to Jagjiv Kumar Arora, Surender Kumar approached him at his company premises at Noida in June 2012 and offered him to join in his company at Saudi Arabia without any investment on his part. At first meeting opposite party-2 did not agree. Late on all the applicants time to time met him and induced him to join in his business. The applicants offered to give shares equal to the existing shares of the company and handover control and management, of his entire business, in lieu of his expertise, confidential technical and business models, technical knowhow, cost-profit analysis formulas, contracts, management styles and trade knowledge/experience of 25 years in this business. The applicants offered to give shares equal to the existing shares of the company and handover control and management, of his entire business, in lieu of his expertise, confidential technical and business models, technical knowhow, cost-profit analysis formulas, contracts, management styles and trade knowledge/experience of 25 years in this business. They offered to pay 50% of profit, towards his 50% shares and 10% of profit towards management charges to opposite party-2. After several efforts made by the applicants, he agreed to their offer and an agreement in shape of Memorandum of Understanding dated 18.7.2012 (MOU) was executed between the WMI, current owners and opposite party-2 (Strategic Partner). The effective date of this MOU was 1.8.2012. (e) Opposite party-2 alleged that he, his son Sahil Arora and his expert employees undertook management of the business of the company on 1.8.2012 and run it up to 31.12.2012, according to their expertise, confidential technical and business models, technical knowhow, cost-profit analysis formulas, contracts, management styles and trade knowledge. Due to his special knowledge, gross income of the company was increased to from SAR 59.76 lakh in 2011 to SAR 87.82 lakh in 2012. But the applicants have not performed their obligation as fixed in MOU. Although share certificates of 1250 shares of the Company WMI were issued to opposite party-2 and his nominee Sahil Arora on 18.7.2012 but these shares were not registered with Saudi Arabia General Investment Authority (SAGIA), a government body to oversee investment including foreign investment in Kingdom of Saudi Arabia. Due to which they did not get legal status in WMI. Signatures of opposite party-2 and Sahil Arora were not introduced/attested in the banks of company as such they could not operate the account nor work visa were made available to them. At this stage differences arose between them. 4. Ultimately Jagjiv Kumar Arora (opposite party-2) filed a complaint dated 23.8.2013 before Superintendent of Police (Rural), Gautam Budh Nagar, who vide order dated 8.9.2013, directed local police to register an FIR, on which Case Crime No. 236 of 2013, under Section 387, 403, 406, 417, 420, 465, 467, 468, 471, 474 and 120-B IPC was registered at P.S. Badalpur, district Gautam Budh Nagar on 8.9.2013 at 21.30 hours, against (i) Alok Chandra, (ii) Tanvir Bukhari, (iii) Surendra Kumar and (iv) Anand Vardhan (the applicants) in the aforementioned two petitions. It has been stated in the complaint that the complainant was Managing Director of M/S Supreme Alloys Ltd. 575, Dujana Road, Gautam Budh Nagar. M/S Supreme Alloys Ltd. has various plants for production of iron and steel products and had manufacturing experience of about 25 years. He had confidential technical and business models, trade knowledge, cost-profit analysis formulas, expertise, technical knowhow, contracts, management styles, investments. The complainant has also created a separate identity for himself and is well renowned in his field of business. Around June 2012, Surender Kumar, the accused, who was an acquaintance, approached the complainant and offered him to enter into an agreement to acquire an iron and steel plant in Saudi Arabia. The accused represented that investment in the said plant would be a very lucrative and profitable venture, however, the complainant refused to enter into the said agreement. Few days later, Surender Kumar alongwith Alok Chandra again met the complainant at his company premises. The accused persuaded the complainant to enter into an agreement with them. The accused offered various allurements to the complainant. They induced and enticed the complainant that he would gain immensely. They induced him by saying that he would be given complete management and financial control to run an iron and steel plant and in lieu of which the complainant would get 50% ownership rights in an iron and steel plant in Saudi Arabia beside 50% share in profits and 10% share in management fee. On 17.7.2012, all the accused persons met the complainant at the residence of Surender Kumar at Vasant Vihar, Delhi. The accused Surender Kumar introduced all the other accused persons as running a company named World Mining Industries Ltd. (WMI), duly incorporated under the laws of Kingdom of Saudi Arabia. The accused persons stated that WMI holds Lease to Ownership Agreement with M/S SHARQIA (which has facilities for production of iron and steel bars). The accused persons induced the complainant to render his expertise, confidential technical and business models, trade, knowledge, cost profit analysis formulas, expertise technical knowhow, contracts, management styles, employees etc. of his personal self and of M/S. Supreme Alloys Ltd. and achieve production levels in M/S SHARQIA and convert WMI a loss making company to a profit making company. The complainant was very reluctant to invest his valuables in Saudi Arabia. of his personal self and of M/S. Supreme Alloys Ltd. and achieve production levels in M/S SHARQIA and convert WMI a loss making company to a profit making company. The complainant was very reluctant to invest his valuables in Saudi Arabia. The accused persons presented a very rosy picture and assured the complainant that since they were citizens of India and the complainant could have supreme confidence in their representations. The accused persons boasted of their big contacts in Saudi Arabia and undertook to comply all statutory and regulatory compliances in Saudi Arabia. Next date of meeting was fixed for 18.7.2012. On 18.7.2012, the accused persons committed assured returns to the complainant. It was told to the complainant that currently WMI due to lack of technical and business models is unable to achieve production levels and is a loss making company and the complainant would be given all comforts in form of a written binding agreement. The accused persons thus lured the complainant to enter into a written Strategic Partnership Agreement dated 18.7.2012. The aforesaid representations in the Written Strategic Partnership Agreement dated 18.7.2012 were made and executed at the residence of accused Alok Chandra at 44, Club Drive, M.G. Road, Delhi, in presence of all the accused and signed by them. The accused persons thus lured the complainant to enter into a written Strategic Partnership Agreement dated 18.7.2012. The aforesaid representations in the Written Strategic Partnership Agreement dated 18.7.2012 were made and executed at the residence of accused Alok Chandra at 44, Club Drive, M.G. Road, Delhi, in presence of all the accused and signed by them. Written Strategic Partnership Agreement dated 18.7.2012 contained various binding commitments and rights to the complainant such as (i) right to curtail production as a business decision without obligation for compensation in case of realization from conversion falls below SR 1000 (ii) 50 % stake in WMI to be issued to complainant or complainant’’s nominee and registered with the appropriate statutory authorities which cannot be diluted without complainant’s consent (iii) investments of all the accused persons in the credit line around 9,637,000/- SR in WMI, which cannot be withdrawn by accused persons but would be converted into equity with equal equity issued in complainant’s favour without any consideration from complainant’s side (iv) complete control over management, employees and finances of WMI and production facilities of M/S SHARQIA alongwith all required statutory permissions obtained by accused persons within the settling period of three months (v) completion of all required statutory formalities by accused persons such as issuance of Iqama (work permit authorization), Visa for complainant and his employees (vi) complainant’s introduction as a signatory in the Bank accounts of WMI to enable complainant to assume full financial control (vii) constitution of Joint Venture Committee with complainant’s equal participation for decision making on affairs not mentioned in the Agreement (viii) equal representation of complainant’s managerial men in the Board of WMI (ix) complainant’s introduction and sharing of this Agreement with management of M/S SHARQIA. The accused persons sought confidential data from the complainant and assured the complainant that in return and in compliance of agreement dated 18.7.2012, they would hold Board Meeting of WMI at the time of executing of agreement in Delhi itself. Agreement dated 18.7.2012 was to remain enforceable till a Party remains shareholder or decides to terminate the agreement with mutual consent, thus, complainant was assured permanent ownership rights of 50% in WMI and in M/S SHARQIA. Agreement dated 18.7.2012 was to remain enforceable till a Party remains shareholder or decides to terminate the agreement with mutual consent, thus, complainant was assured permanent ownership rights of 50% in WMI and in M/S SHARQIA. The Agreement provided that all the above obligations were to be completed by accused persons within the settling period of three months and thereafter within a period of nine months complainant was supposed to achieve the committed production levels in the plant. In clause 2.26, the Agreement provides that in case WMI and accused persons are not able to succeed in facilitating complainant’s introduction in WMI, WMI shall be liable to continue to compensate complainant with an amount equivalent to its share in profits generated in the currency of the MOU, the management fee for the period of operation under this MOU, the amount equivalent to the investment made in the company, including working capital, for achieving the goal set out in this MOU. The accused persons passed Board Resolutions dated 18.7.2012 at 44, Club Drive, M.G. Road, Delhi issuing 50% shares of WMI to complainant or complainant’s nominee, pursuant to this, Share Certificate for 650 and 600 shares being the 50% shares of WMI were issued in favour of complainant’s nominee, the said position was also reflected in amended Article 9 in the Articles of Association and in the summary of shareholding as on 7.8.2012. By way of Board Resolution dated 18.7.2012, the accused persons also undertook not withdraw their investments in the credit line of around 9,637,000/- SR and convert the same into equity (if required) with equal equity issued in complainant’s favour without any consideration from complainant’s side. The accused persons also passed another resolution dated 18.7.2012 where under the accused persons undertook that complainant would be made a joint signatory in the Bank account of WMI and pass financial control of WMI would pass in complainant’s favour. Under the Resolution dated 18.7.2012, complainant and his nominee Sahil Arora were appointed as Director in WMI and were assured that now they will get the full management control of WMI. All these documents were handed over to complainant in Delhi and were executed in Delhi at 44, Club Drive, M.G. Road, Delhi by Alok Chandra and Surendra Kumar with the connivance of all the accused. All these documents were handed over to complainant in Delhi and were executed in Delhi at 44, Club Drive, M.G. Road, Delhi by Alok Chandra and Surendra Kumar with the connivance of all the accused. That the complainant on the above allurements and in faith of Board Resolutions dated 18.7.2012 was asked and the Complainant parted with his and M/s Supreme Alloy’s valuable confidential technical and business models, trade knowledge, cost-profit analysis formulas, expertise, technical knowhow, contracts, management models. It is now evident that the above documents were executed by the accused persons under a well planned criminal conspiracy hatched by all the accused persons, the above actions were done in concert and connivance with a pre-planned motive to dupe the complainant of his profits, investments and confidential data. The complainant was enticed to invest and devote his efforts and efforts his team in WMI and in SHARQIA and make them into a profitable venture. The complainant realized that neither the complainant nor his team was issued work permits, government authorizations despite submitting all requisite papers to accused persons. This was clearly under the pre-planned conspiracy so that complainant and his employees could not claim their rights. The appointment of complainant as MD/GM of WMI was also not registered by the accused persons with the authorities. The complainant has now come to know that the above Board Resolutions dated 18.7.2012, executed by the accused persons granting complainant management rights, shareholdings have not been registered with any government body and it therefore appears that these documents are sham. The accused persons executed sham documents to cheat, defraud the complainant of its valuable confidential technical and business models, trade knowledge, cost-profit analysis formulas, expertise, technical knowhow, contracts, management models and investments. The accused persons are also attempting to utilize the valuable and confidential information so obtained by the complainant for a third entity being formed by the accused person, this action amounts to criminal breach of trust as the valuable and confidential was entrusted to the accused persons for a specific purpose and on specific understanding and in consideration of the Board Resolutions and Agreement dated 18.7.2012, which was actually executed to defraud the complainant. The complainant got a copy of the Auditor’s report of WMI for the year ending 31st December, 2012 filed by the accused persons, the said report, does not reflect the shareholding issued to complainant/his nominee nor the complainant or Sahil Arora has been shown as Director/Partners of WMI in the said report. The above Share Certificates issued by accused persons and handed over to the complainant at 44, Club Drive, M.G. Road, Delhi seems were forged documents. The complainant now realizes that his and M/S Supreme Alloys valuables in form of confidential data and investments were usurped by the accused persons in a well laid out criminal conspiracy. The complainant was handed unregistered share certificates and Board resolutions, whose enforceability is questionable. Complainant has now realized that Complainant was not given any management and financial rights for the sole purpose that the accused persons could usurp complainant’s investments, valuables and profits. Complainant has also come to know that under the criminal conspiracy hatched by the accused persons and breach of trust, Alok Chandra and Tanvir Bukhari siphoned off huge sums of money to the tune of 9,00,000/- SR by fabricating and forging accounts. The said sum of money belonged to complainant being my profits and management fee. The said money has been brought in Delhi and has been used to make benami investments in Delhi, Gautam Budh Nagar (Greater Noida) and overseas in name of various family members of accused persons. Complainant has also come to know that WMI was a sham entity only conceived to dupe an investor like the complainant. The accused persons never intended to work WMI, WMI was incorporated by accused persons only as a mock up and in pursuance of criminal conspiracy, various employees working with M/S SHARQIA/ WMI, who were appointed by accused persons, were found to have been working by the departments in an unauthorized manner and were detained by the government officials (police) and may deported. The said employees were never appointed to work on long term as clearly WMI was set up only as a farce entity to dupe a gullible investor. Complainant on inquiry have now found that may more employees were also found as not having required permissions to work in the territory under compelling circumstances they were removed from employment. Complainant has also come to know recently that authorizations with WMI are also incomplete. Complainant on inquiry have now found that may more employees were also found as not having required permissions to work in the territory under compelling circumstances they were removed from employment. Complainant has also come to know recently that authorizations with WMI are also incomplete. WMI as a company has not been implemented as till date it has not performed the works for which it was incorporated. Clearly, the licenses issued to WMI to operate as a company till date are not effective. Even the said licenses are due to expire shorty. Various compliance of WMI and M/S SHARQIA have not been completed, resultantly, no invitation, no regular visas, are being issued to both entities. Complainant has come to know that the accused persons while conceiving incorporation of an entity like WMI, had conspired to set up WMI with the sole purpose to use it to dupe an investor such as the complainant by enticing him to invest under a rosy picture of foreign acquisition. Around SR 6,000,000.00 out of SR 15,000,000.00 has been illegally diverted by the accused persons to M/S SHARQIA which includes complainant’s profits and management fee earned by him in WMI involving complainant’s and Supreme Alloys confidential data, expertise and investments during the last 10 months, complainant was entitled to 50% of SR 15,000,000.00 as profits and additional 10% as management fee. When complainant exposed the criminal conspiracy in his detailed email dated 2.7.2013, and in his meetings with accused persons on 12.7.2013 and 13.7.2013, held in Delhi at Hotel Hyatt and Hotel Lutyens respectively, the complainant was threatened by the accused persons that in case complainant takes a legal recourse he shall loose all his money and to save money he should invest a further amount of SR 4 million, complainant was also threatened to bring further investment of SR 2.2 million otherwise agreement with M/S SHARQIA will be terminated and with the termination complainant would loose all his investments and profits as the agreement with M/S SHARQIA is the only asset with WMI. The threats have further been extended by the accused persons over telephone and also be way of two emails dated 19.7.2013 and 20.7.2013. Complainant’s representatives in WMI have informed complainant that employees of accused persons are hiding all financial transactions being done by accused persons in WMI, clearly more funds are being siphoned off. The threats have further been extended by the accused persons over telephone and also be way of two emails dated 19.7.2013 and 20.7.2013. Complainant’s representatives in WMI have informed complainant that employees of accused persons are hiding all financial transactions being done by accused persons in WMI, clearly more funds are being siphoned off. Complainant has his representatives in WMI have come to know from reliable sources that accused persons have diverted the plant of M/S SHARQIA, the entire amount of about 15 million SR earned by complainant by operating WMI and M/S SHARQIA, alongwith my confidential data, investments to a third company/entity to dupe complainant and to usurp complainant’s valuable data. This has been done by the accused persons in conspiracy and in connivance with the management and officials of M/S SHARQIA. The accused persons in connivance with management of M/S SHARQIA are also intending to terminate the Lease to Ownership Agreement for the sole purpose of cheating and defrauding complainant and the shareholders of M/S Supreme Alloys. On 16.8.2013, accused Surender Kumar visited the complainant at 575, Dujana Road, District Gautam Budh Nagar, Uttar Pradesh and threatened the complainant with dire consequences to deliver back the shares of WMI allotted to M/S Supreme Alloys International. The complainant was also threatened to forget his interests in WMI and in M/S SHARQIA. The complainant also received threats from accused Alok Chandra. The complainant has been receiving threatening calls from accused persons Surender and Tanvir from Saudi Arabia from telephone number +966547649552 on his mobile number 9810004325, to succumb to their demands of relinquishing rights in WMI and M/s SHARQIA or otherwise they shall ensure that the complainant would face serious consequences the moment he steps in Saudi Arabia. 5. The police after investigation submitted Final Report No. 11 of 2014 dated 4.3.2014. The complainant made a representation to Senior Superintendent of Police, on which, he by order dated 17.12.2014, called for comments from Superintendent of Police, who submitted his comments on 22.1.2015, recommending for further investigation. In the meantime, notice was issued to the complainant on Final Report, from the Court of Additional Chief Judicial Magistrate, II, Gautam Budh Nagar, then he filed a protest petition dated 16.2.2015. In the meantime, notice was issued to the complainant on Final Report, from the Court of Additional Chief Judicial Magistrate, II, Gautam Budh Nagar, then he filed a protest petition dated 16.2.2015. Additional Chief Judicial Magistrate, II, Gautam Budh Nagar, by order dated 12.3.2015, directed to convert the case as complaint case and permitted the complainant to lead evidence under Section 200 Cr.P.C. Thereafter, statement of Jagjeev Kumar Arora was recorded on 13.4.2015, under Section 200 Cr.P.C, Sahil Arora was recorded on 16.4.2015 under Section 202 Cr.P.C. Additional Chief Judicial Magistrate by order dated 25.5.2015 summoned the applicants under Section 406, 420, 467, 468, 471, 120-B IPC. When the applicants did not appear then by order dated 2.7.2015, bailable warrants were issued against the applicants. Hence these applications have been filed. 6. The counsel for the applicants submitted that the issue as to who had offered /induced for deal between the parties has be to be decided on the basis of recitals of the deed and subsequent conduct of the parties. In any case, the offer to join in the business of the applicants has been accepted by opposite party-2 and a written agreement in shape of MOU dated 18.7.2012, was executed by them. This is an express contract in which terms and conditions of the contract have been incorporated. The applicants did not conceal any thing about condition of the Company WMI nor made any false representation. Existing condition of WMI, the current owners and their liability have been disclosed in opening clauses of MOU. Clause 3 of MOU related to introduction of Strategic Partner, in which it has been clearly mentioned that the current owners have chosen to enter into a joint venture with the Strategic Partner as he has the requisite expertise in setting up and managing steel plants in India and has sufficient finances to meet the requirements for expansion and operation of the same. Clause 2.6 of terms of MOU provides for issue shareholding equivalent to the current shareholding to the Strategic Partner. Clause 2.7 of terms of MOU provides that the subscription monies paid by Strategic Partner in terms of clause 2.6 alongwith all investments made for the up-gradation of production facilities including working capital shall be utilized by the Company, inter alia, in augmenting its capacity to produce steel from 1200 mt. per month to 3500 mt. Clause 2.7 of terms of MOU provides that the subscription monies paid by Strategic Partner in terms of clause 2.6 alongwith all investments made for the up-gradation of production facilities including working capital shall be utilized by the Company, inter alia, in augmenting its capacity to produce steel from 1200 mt. per month to 3500 mt. per month and this augmentation shall be achieved by Strategic Partner within a period of nine months from the effective date. Clause 2.25 provides that on execution of this agreement, all funds belonging to any of the current owners or the Strategic Partner shall be treated as grants to the company and shall not be used to issue any equity to any of the current owners or the Strategic Partner in order to maintain the shareholding balance set out in this MOU. From these clauses it is clear that opposite party-2 was required to invest money equivalent to total amount of enhanced share capital i.e. SAR 1250000/-. The applicants vide resolution dated 18.7.2012, issued 1250 share certificates of WMI to opposite party-2 and his nominee. They were admitted as the Directors of the company w.e.f. 1.8.2012 and from that day they were handed over management and control of the manufacturing unit of the Company. The Company of opposite party-2 also passed a resolution dated 26.11.2012 for purchasing 50% share and making investment in the Company WMI. But opposite party-2 and his nominee have not invested the amount of share capital although share certificate had been issued to them. From the terms of MOU and subsequent conduct of the parties it is fully proved that this was a fair business transaction between the parties, under which opposite party-2 was not only required to manage the business according to his expertise etc. but also to invest money equal to share capital of the Company WMI, so that production limit could be enhanced to 3500 mt. Per month from 1200 mt. Per month. The applicants had no intention to cheat opposite party-2. Since it was a written contract as such apart from MOU dated 18.7.2012, no other evidence in this respect is admissible in evidence in view of Section 92 of Evidence Act, 1872 as well as clause 9.1 of this MOU. Admittedly opposite party-2 and his nominee did not pay the money of 1250 shares issued to them. Since it was a written contract as such apart from MOU dated 18.7.2012, no other evidence in this respect is admissible in evidence in view of Section 92 of Evidence Act, 1872 as well as clause 9.1 of this MOU. Admittedly opposite party-2 and his nominee did not pay the money of 1250 shares issued to them. Due to which their shares could be registered with Saudi Arabia General Investment Authority. In the absence of valid shareholdings in WMI, the signatures of opposite party-2 and his nominee could be introduced/attested in the bank nor work visa could be obtained for them. Opposite party-2 has himself committed breach of the contract. In order to pressurize the applicants for not to sue for damages for breach of contract, present criminal case has been mala fide initiated. For the offence of breach of trust under Section 405 IPC, there must be entrustment of tangible property and not the ideas or expertise. For the offence of cheating under Section 415 IPC, delivery of tangible property and its retaining/misappropriating was required. There is absolutely no allegation as to what tangible property has been enstrusted/delivered to the applicants, which are retained/misappropriated. So far as expertise, confidential technical and business models, technical knowhow, cost-profit analysis formulas, contracts, management styles and trade knowledge/ experience etc. of opposite party-2 are concerned these are not tangible property nor these were entrusted or delivered to the applicants and retained by them. So long as opposite party-2 worked as the Director of the Company WMI, he might have exercised his expertise but it was never handed over/entrusted to the applicants. So far as payment of SAR 60 lakhs to SHARQIA is concerned SAR 30 lakhs was due up to 1.8.2012. Vide clause 2.4 of MOU, the applicants were required to make available in the plant in the form of stocks of raw material, finished goods, receivable, cash and bank balance of SAR 30 lakhs in the company up to 1.8.2012, which was made available by them. Amount of installments from August 2012 to December 2012 has to be paid from profit of the business and there is no breach of trust as these are amount of monthly installments and had been paid according to the terms of MOU. Amount of installments from August 2012 to December 2012 has to be paid from profit of the business and there is no breach of trust as these are amount of monthly installments and had been paid according to the terms of MOU. Allegation that the applicants had withdrawn SAR 9 lakh is concerned, withdrawal of money by the partners does not amount to an offence of breach of trust under Section 405 IPC, as held by Supreme Court in Velji Raghavji Patel v. State of Maharashtra, AIR 1965 SC 1433 , in which it was held that an owner of property, in whichever way he uses his property and with whatever intention will not be liable for misappropriation and that would be so even if he is not the exclusive owner thereof. As already stated, a partner has, undefined ownership alongwith the other partners over all the assets of the partnership. If he chooses to use any of them for his own purposes he may be accountable civilly to the other partners. But he does not thereby commit any misappropriation. Mr. Chatterjee’s alternative contention must be rejected. They also relied upon Petlad Turkey Red Dye Works Co. Ltd. v. Dyes & Chemical Workers’ Union, AIR 1960 SC 1006 ; Hari Prasad Chamaria v. Bishun Kumar Surekha, (1973) 2 SCC 823 ; Madhavrao Jiwajirao Scindia v. Sambhajirao Chandrojirao Angre, (1988) 1 SCC 692 ; Harshendra Kumar D. v. Rebatilata Koley, (2011) 3 SCC 351 ; Anita Malhotra v. Apparel Export Promotion Council, (2012) 1 SCC 520 ; Rajiv Thapar v. Madan Lal Kapoor, (2013) 3 SCC 330 ; Rishipal Singh v. State of U.P., (2014) 7 SCC 215 ; Gunmala Sales (P) Ltd. v. Anu Mehta, (2015) 1 SCC 103 and Amanullah v. State of Bihar, (2016) 6 SCC 699 . They submitted that even if entire complaint and evidence adduced in support of it are taken on its face value, the complaints does not disclose any offence. Criminal prosecution is an abuse of process of the Court and is liable to be quashed. 7. In reply to the aforesaid arguments, the counsel for the complainant-opposite party-2 submitted that M/S Supreme Alloys Ltd. has various plants for production of iron and steel products and had manufacturing experience of about 25 years in India. Criminal prosecution is an abuse of process of the Court and is liable to be quashed. 7. In reply to the aforesaid arguments, the counsel for the complainant-opposite party-2 submitted that M/S Supreme Alloys Ltd. has various plants for production of iron and steel products and had manufacturing experience of about 25 years in India. The complainant had confidential technical and business models, trade knowledge, cost-profit analysis formulas, expertise, technical knowhow, contracts, management styles, investments. The complainant was holding licence of “Sal-Tempcore Inc.” an American technology in manufacture of steel. The complainant has also created a separate identity for himself and is well renowned in his field of business. In June 2012, Surender Kumar, who was an acquaintance, approached the complainant and offered him to enter into an agreement to acquire an iron and steel plant in Saudi Arabia. Surender Kumar induced him that investment in the said plant would be a very lucrative and profitable venture, however, the complainant refused to enter into the said agreement. Few days later, Surender Kumar alongwith Alok Chandra again met the complainant at his company premises. They again persuaded the complainant to enter into an agreement with them. They offered various allurements to the complainant. They induced him by saying that he would be given complete management and financial control to run an iron and steel plant and in lieu of which the complainant would get 50% ownership rights in an iron and steel plant in Saudi Arabia beside 50% share in profits and 10% share in management fee and would gain immensely. On 17.7.2012, all the applicants met the complainant at the residence of Surender Kumar at Vasant Vihar, Delhi. Surender Kumar introduced all the other applicants as running a company named World Mining Industries Ltd. (WMI), duly incorporated under the laws of Kingdom of Saudi Arabia. They induced the complainant to render his expertise, confidential technical and business models, trade, knowledge, cost profit analysis formulas, expertise technical knowhow, contracts, management styles, employees etc. of his personal self and of M/S. Supreme Alloys Ltd. and achieve production levels in M/S SHARQIA and convert WMI a loss making company to a profit making company. Total liability on the shareholders of WMI on 31.12.2011 was SAR 68.27 lakhs and value of share of WMI was SAR -5462.38. The complainant was very reluctant to invest his valuables in Saudi Arabia. Total liability on the shareholders of WMI on 31.12.2011 was SAR 68.27 lakhs and value of share of WMI was SAR -5462.38. The complainant was very reluctant to invest his valuables in Saudi Arabia. The applicants presented a very rosy picture and assured the complainant that since they were citizens of India and the complainant could have supreme confidence in their representations. The applicants boasted of their big contacts in Saudi Arabia and undertook to comply all statutory and regulatory compliances in Saudi Arabia. By way of Board Resolution dated 18.7.2012, the applicants issued 1250 share certificates to the complainant and his nominee also undertook not withdraw their investments in the credit line of around SAR 9,637,000/- and convert the same into equity (if required) with equal equity issued in complainant’s favour without any consideration from complainant’s side. At that time cost of the share issued to the complainant was SAR -2231.193/- The applicants also passed another resolution dated 18.7.2012 where under they undertook that the complainant would be made a joint signatory in the Bank account of WMI and pass financial control of WMI in complainant’s favour. Under the Resolution dated 18.7.2012, complainant and his nominee Sahil Arora were appointed as Director in WMI and were assured that now they will get the full management control of WMI. The complainant, on the above allurements and relying upon Board Resolutions dated 18.7.2012, parted with his and M/s Supreme Alloy’s valuable confidential technical and business models, trade knowledge, cost-profit analysis formulas, expertise, technical knowhow, contracts, management models. Later on it was found that the above documents were executed by the applicants under a well planned criminal conspiracy hatched by all of them, with a pre-planned motive to dupe the complainant of his profits, investments and confidential data. The complainant realized that neither the complainant nor his team was issued work permits, government authorizations despite submitting all requisite papers to accused persons. The share issued to the complainant and his nominee were not registered with Saudi Arabia General Investment Authority nor their signatures were introduced/attested for the bank account of the Company WMI. Investment visa and work visa were not issued to the complainant and his nominee. Due to efforts made by the complainants and his company, gross income of WMI was increased from SAR 59.76 lakhs in year 2011 to SAR 87.82 lakhs in year 2012. Investment visa and work visa were not issued to the complainant and his nominee. Due to efforts made by the complainants and his company, gross income of WMI was increased from SAR 59.76 lakhs in year 2011 to SAR 87.82 lakhs in year 2012. The applicants transferred SAR 60 lakhs to SHARQIA. Alok Chandra and Tanvir Bukhari have also withdrew an amount of SAR 9/- lakhs. Thus from very beginning the applicants had intention to cheat the complainant. The complaint discloses cognizable offence. The Magistrate after holding inquiry as contemplated under Section 200 and 202 Cr.P.C. found that there was sufficient materials to proceed with the case and issued process to the applicants. At the initial stage of prosecution, this Court is not required to interfere in it, exercising jurisdiction under Section 482 Cr.P.C. The reason that remedy under civil law is available is no ground to quash the criminal proceeding. He relied upon judgments of Supreme Court in Trisuns Chemical Industry v. Rajesh Agrawal, (1998) 8 SCC 686 ; Medchl Chemicals & Pharma (P) Ltd. v. Biological E. Ltd., (2000) 3 SCC 269 ; Indian Oil Corpn. v. NEPC India Ltd., (2006) 6 SCC 736 ; Iridium India Telecom Ltd. v. Motorola Incorporated India Ltd., (2011) 1 SCC 74 ; Arun Bhandari v. State of U.P., (2013) 2 SCC 801 and ARCI v. Nimra Cerglass Technics (P) Ltd., (2016) 1 SCC 348 . 8. I have considered the arguments of the counsel for the parties and examined the record. First question arises for consideration is about jurisdiction of High Court for quashing prosecution at the initial stage, exercising powers under Section 482 Cr.P.C. Present cases are arising out of the complaint case. A three-Judge Bench of Supreme Court in Vadilal Panchal v. Dattatraya Dulaji Ghadigaonkar, AIR 1960 SC 1113 , held that Section 200 says inter alia what a Magistrate taking cognisance of an offence on complaint shall do on receipt of such a complaint. A three-Judge Bench of Supreme Court in Vadilal Panchal v. Dattatraya Dulaji Ghadigaonkar, AIR 1960 SC 1113 , held that Section 200 says inter alia what a Magistrate taking cognisance of an offence on complaint shall do on receipt of such a complaint. Section 202 says that the Magistrate may, if he thinks fit, for reasons to be recorded in writing, postpone the issue of process for compelling the attendance of the person complained against and direct an inquiry for the purpose of ascertaining the truth or falsehood of the complaint; in other words, the scope of an inquiry under the Section is limited to finding out the truth or falsehood of the complaint in order to determine the question of the issue of process. The inquiry is for the purpose of ascertaining the truth or falsehood of the complaint; that is, for ascertaining whether there is evidence in support of the complaint so as to justify the issue of process and commencement of proceedings against the person concerned. The Section does not say that a regular trial for adjudging the guilt or otherwise of the person complained against should take place at that stage; for the person complained against can be legally called upon to answer the accusation made against him only when a process has issued and he is put on trial. Section 203, be it noted, consists of two parts: the first part indicates what are the materials which the Magistrate must consider, and the second part says that if after considering those materials there is in his judgment no sufficient ground for proceeding, he may dismiss the complaint. Section 204 says that if in the opinion of the Magistrate there is sufficient ground for proceeding, he shall take steps for the issue of necessary process. A four-Judge Bench of Supreme Court in Chandra Deo Singh v. Prokash Chandra Bose, AIR 1963 SC 1430 , held that no doubt, one of the objects behind the provisions of Section 202 CrPC is to enable the Magistrate to scrutinise carefully the allegations made in the complaint with a view to prevent a person named therein as accused from being called upon to face an obviously frivolous complaint. But there is also another object behind this provision and it is to find out what material there is to support the allegations made in the complaint. But there is also another object behind this provision and it is to find out what material there is to support the allegations made in the complaint. It is the bounden duty of the Magistrate while making an enquiry to elicit all facts not merely with a view to protect the interests of an absent accused person, but also with a view to bring to book a person or persons against whom grave allegations are made. Whether the complaint is frivolous or not has, at that stage, necessarily to be determined on the basis of the material placed before him by the complainant. Whatever defence the accused may have can only be enquired into at the trial. An enquiry under Section 202 can in no sense be characterised as a trial for the simple reason that in law there can be but one trial for an offence. Permitting an accused person to intervene during the enquiry would frustrate its very object and that is why the legislature has made no specific provision permitting an accused person to take part in an enquiry. It is true that there is no direct evidence in the case before us that the two persons who were examined as Court witnesses were so examined at the instance of Respondent 1 but from the fact that they were persons who were alleged to have been the associates of Respondent 1 in the first information report lodged by Panchanan Roy and who were alleged to have been arrested on the spot by some of the local people, they would not have been summoned by the Magistrate unless suggestion to that effect had been made by counsel appearing for Respondent 1. This inference is irresistible and we hold that on this ground, the enquiry made by the enquiring Magistrate is vitiated. A Bench of three Hon’ble Judges in Manharibhai Muljibhai Kakadia v. Shaileshbhai Mohanbhai Patel, (2012) 10 SCC 517 , held that Section 202 of the Code has twin objects; one, to enable the Magistrate to scrutinise carefully the allegations made in the complaint with a view to prevent a person named therein as accused from being called upon to face an unnecessary, frivolous or meritless complaint and the other, to find out whether there is some material to support the allegations made in the complaint. The Magistrate has a duty to elicit all facts having regard to the interest of an absent accused person and also to bring to book a person or persons against whom the allegations have been made. To find out the above, the Magistrate himself may hold an inquiry under Section 202 of the Code or direct an investigation to be made by a police officer. The dismissal of the complaint under Section 203 is without doubt a pre-issuance of process stage. The Code does not permit an accused person to intervene in the course of inquiry by the Magistrate under Section 202. The legal position is no more res integra in this regard. A three-Judge Bench of Supreme Court in Gian Singh v. State of Punjab, (2012) 10 SCC 303 , has held that in the very nature of its constitution, it is the judicial obligation of the High Court to undo a wrong in course of administration of justice or to prevent continuation of unnecessary judicial process. This is founded on the legal maxim quando lex aliquid alicui concedit, conceditur et id sine qua res ipsa esse non potest. The full import of which is whenever anything is authorised, and especially if, as a matter of duty, required to be done by law, it is found impossible to do that thing unless something else not authorised in express terms be also done, may also be done, then that something else will be supplied by necessary intendment. Ex debito justitiae is inbuilt in such exercise; the whole idea is to do real, complete and substantial justice for which it exists. The power possessed by the High Court under Section 482 of the Code is of wide amplitude but requires exercise with great caution and circumspection.” In Sunil Bharti Mittal v. CBI, (2015) 4 SCC 609 , held that on the other hand, Section 204 of the Code deals with the issue of process, if in the opinion of the Magistrate taking cognizance of an offence, there is sufficient ground for proceeding. This Section relates to commencement of a criminal proceeding. This Section relates to commencement of a criminal proceeding. If the Magistrate taking cognizance of a case (it may be the Magistrate receiving the complaint or to whom it has been transferred under Section 192), upon a consideration of the materials before him (i.e. the complaint, examination of the complainant and his witnesses, if present, or report of inquiry, if any), thinks that there is a prima facie case for proceeding in respect of an offence, he shall issue process against the accused. A wide discretion has been given as to grant or refusal of process and it must be judicially exercised. A person ought not to be dragged into Court merely because a complaint has been filed. If a prima facie case has been made out, the Magistrate ought to issue process and it cannot be refused merely because he thinks that it is unlikely to result in a conviction. However, the words “sufficient ground for proceeding” appearing in Section 204 are of immense importance. It is these words which amply suggest that an opinion is to be formed only after due application of mind that there is sufficient basis for proceeding against the said accused and formation of such an opinion is to be stated in the order itself. The order is liable to be set aside if no reason is given therein while coming to the conclusion that there is prima facie case against the accused, though the order need not contain detailed reasons. A fortiori, the order would be bad in law if the reason given turns out to be ex facie incorrect. 9. Supreme Court in R.P. Kapur v. State of Punjab, AIR 1960 SC 866 , held that it is well-established that the inherent jurisdiction of the High Court can be exercised to quash proceedings in a proper case either to prevent the abuse of the process of any Court or otherwise to secure the ends of justice. Ordinarily criminal proceedings instituted against an accused person must be tried under the provisions of the Code, and the High Court would be reluctant to interfere with the said proceedings at an interlocutory stage. It is not possible, desirable or expedient to lay down any inflexible rule which would govern the exercise of this inherent jurisdiction. Ordinarily criminal proceedings instituted against an accused person must be tried under the provisions of the Code, and the High Court would be reluctant to interfere with the said proceedings at an interlocutory stage. It is not possible, desirable or expedient to lay down any inflexible rule which would govern the exercise of this inherent jurisdiction. However, we may indicate some categories of cases where the inherent jurisdiction can and should be exercised for quashing the proceedings. There may be cases where it may be possible for the High Court to take the view that the institution or continuance of criminal proceedings against an accused person may amount to the abuse of the process of the Court or that the quashing of the impugned proceedings would secure the ends of justice. If the criminal proceeding in question is in respect of an offence alleged to have been committed by an accused person and it manifestly appears that there is a legal bar against the institution or continuance of the said proceeding the High Court would be justified in quashing the proceeding on that ground. Absence of the requisite sanction may, for instance, furnish cases under this category. Cases may also arise where the allegations in the first information report or the complaint, even if they are taken at their face value and accepted in their entirety, do not constitute the offence alleged; in such cases no question of appreciating evidence arises; it is a matter merely of looking at the complaint or the first information report to decide whether the offence alleged is disclosed or not. In such cases it would be legitimate for the High Court to hold that it would be manifestly unjust to allow the process of the criminal Court to be issued against the accused person. A third category of cases in which the inherent jurisdiction of the High Court can be successfully invoked may also arise. In cases falling under this category the allegations made against the accused person do constitute offence alleged but there is either no legal evidence adduced in support of the case or evidence adduced clearly or manifestly fails to prove the charge. In cases falling under this category the allegations made against the accused person do constitute offence alleged but there is either no legal evidence adduced in support of the case or evidence adduced clearly or manifestly fails to prove the charge. In dealing with this class of cases it is important to bear in mind the distinction between a case where there is no legal evidence or where there is evidence which is manifestly and clearly inconsistent with the accusation made and cases where there is legal evidence which on its appreciation may or may not support the accusation in question. In exercising its jurisdiction under Section 561-A the High Court would not embark upon an enquiry as to whether the evidence in question is reliable or not. That is the function of the trial Magistrate, and ordinarily it would not be open to any party to invoke the High Court’s inherent jurisdiction and contend that on a reasonable appreciation of the evidence the accusation made against the accused would not be sustained. Broadly stated that is the nature and scope of the inherent jurisdiction of the High Court under Section 561-A in the matter of quashing criminal proceedings, and that is the effect of the judicial decisions on the point. 10. Broadly stated that is the nature and scope of the inherent jurisdiction of the High Court under Section 561-A in the matter of quashing criminal proceedings, and that is the effect of the judicial decisions on the point. 10. Supreme Court again held that although it is not possible to give exhausting categories of cases, in which criminal proceeding can be quashed at the initial stage but some of the categories have been enumerated in State of Haryana v. Bhajan Lal, (1992) Supp 1 SCC 335, holing that in the backdrop of interpretation of various relevant provisions of the Code of Criminal Procedure under Chapter XIV and of the principles of law enunciated by this Court in a series of decisions relating to the exercise of the extraordinary power under Article 226 or the inherent powers under Section 482 CrPC gave the following categories of cases by way of illustration wherein such power could be exercised either to prevent abuse of the process of the Court or otherwise to secure the ends of justice, making it clear that it may not be possible to lay down any precise, clearly-defined and sufficiently channelised and inflexible guidelines or rigid formulae and to give an exhaustive list to myriad kinds of cases wherein such power should be exercised:- (1) Where the allegations made in the first information report or the complaint, even if they are taken at their face value and accepted in their entirety do not prima facie constitute any offence or make out a case against the accused. (2) Where the allegations in the first information report and other materials, if any, accompanying the FIR do not disclose cognizable offence, justifying an investigation by police officers under Section 156(1) of the Code except under an order of a Magistrate within the purview of Section 155(2) of the Code. (3) Where the uncontroverted allegations made in the FIR or complaint and the evidence collected in support of the same do not disclose the commission of any offence and make out a case against the accused. (4) Where the allegations in the FIR do not constitute a cognizable offence but constitute only a non-cognizable offence, no investigation is permitted by a police officer without an order of a Magistrate as contemplated under Section 155(2) of the Code. (4) Where the allegations in the FIR do not constitute a cognizable offence but constitute only a non-cognizable offence, no investigation is permitted by a police officer without an order of a Magistrate as contemplated under Section 155(2) of the Code. (5) Where the allegations made in the FIR or complaint are so absurd and inherently improbable on the basis of which no prudent person can ever reach a just conclusion that there is sufficient ground for proceeding against the accused. (6) Where there is an express legal bar engrafted in any of the provisions of the Code or the concerned Act (under which a criminal proceeding is instituted) to the institution and continuance of the proceedings and/or where there is a specific provision in the Code or the concerned Act, providing efficacious redress for the grievance of the aggrieved party. (7) Where a criminal proceeding is manifestly attended with mala fide and/or where the proceeding is maliciously instituted with an ulterior motive for wreaking vengeance on the accused and with a view to spite him due to private and personal grudge.’ Supreme Court added a note of caution to the effect that the power of quashing a criminal proceeding should be exercised ‘very sparingly and with circumspection and that too in the rarest of rare cases’. 11. In Madhavrao Jiwajirao Scindia v. Sambhajirao Chandrojirao Angre, (1988) 1 SCC 692 , it has been held that the legal position is well settled that when a prosecution at the initial stage is asked to be quashed, the test to be applied by the Court is as to whether the uncontroverted allegations as made prima facie establish the offence. It is also for the Court to take into consideration any special features which appear in a particular case to consider whether it is expedient and in the interest of justice to permit a prosecution to continue. This is so on the basis that the Court cannot be utilised for any oblique purpose and where in the opinion of the Court chances of an ultimate conviction are bleak and, therefore, no useful purpose is likely to be served by allowing a criminal prosecution to continue, the Court may while taking into consideration the special facts of a case also quash the proceeding even though it may be at a preliminary stage. The legal position is well settled that when a prosecution at the initial stage is asked to be quashed, the test to be applied by the Court is as to whether the uncontroverted allegations as made prima facie establish the offence. It is also for the Court to take into consideration any special features which appear in a particular case to consider whether it is expedient and in the interest of justice to permit a prosecution to continue. This is so on the basis that the Court cannot be utilised for any oblique purpose and where in the opinion of the Court chances of an ultimate conviction are bleak and, therefore, no useful purpose is likely to be served by allowing a criminal prosecution to continue, the Court may while taking into consideration the special facts of a case also quash the proceeding even though it may be at a preliminary stage. 12. In State of U.P. v. O.P. Sharma, (1996) 7 SCC 705 , held that so far as the order of cognizance by a Magistrate is concerned, the inherent power can be exercised when the allegations in the first information report or the complaint together with the other materials collected during investigation taken at their face value, do not constitute the offence alleged. At that stage it is not open for the Court either to shift the evidence or appreciate the evidence and come to the conclusion that no prima facie case is made out. 13. In Harshendra Kumar D. v. Rebatilata Koley, (2011) 3 SCC 351 , it has been held that it is fairly settled now that while exercising inherent jurisdiction under Section 482 or revisional jurisdiction under Section 397 of the Code in a case where complaint is sought to be quashed, it is not proper for the High Court to consider the defence of the accused or embark upon an enquiry in respect of merits of the accusations. However, in an appropriate case, if on the face of the documents — which are beyond suspicion or doubt — placed by the accused, the accusations against him cannot stand, it would be travesty of justice if the accused is relegated to trial and he is asked to prove his defence before the trial Court. However, in an appropriate case, if on the face of the documents — which are beyond suspicion or doubt — placed by the accused, the accusations against him cannot stand, it would be travesty of justice if the accused is relegated to trial and he is asked to prove his defence before the trial Court. In such a matter, for promotion of justice or to prevent injustice or abuse of process, the High Court may look into the materials which have significant bearing on the matter at prima facie stage. Followed in Anita Malhotra v. Apparel Export Promotion Council, (2012) 1 SCC 520 . In Rajiv Thapar v. Madan Lal Kapoor, (2013) 3 SCC 330 , it was held that to invoke its inherent jurisdiction under Section 482 CrPC the High Court has to be fully satisfied that the material produced by the accused is such that would lead to the conclusion that his/their defence is based on sound, reasonable, and indubitable facts; the material produced is such as would rule out and displace the assertions contained in the charges levelled against the accused; and the material produced is such as would clearly reject and overrule the veracity of the allegations contained in the accusations levelled by the prosecution/complainant. It should be sufficient to rule out, reject and discard the accusations levelled by the prosecution/complainant, without the necessity of recording any evidence. For this the material relied upon by the defence should not have been refuted, or alternatively, cannot be justifiably refuted, being material of sterling and impeccable quality. The material relied upon by the accused should be such as would persuade a reasonable person to dismiss and condemn the actual basis of the accusations as false. In such a situation, the judicial conscience of the High Court would persuade it to exercise its power under Section 482 CrPC to quash such criminal proceedings, for that would prevent abuse of process of the Court, and secure the ends of justice. In Rishipal Singh v. State of U.P., (2014) 7 SCC 215 , it was held that it is no doubt true that the Courts have to be very careful while exercising the power under Section 482 CrPC. In Rishipal Singh v. State of U.P., (2014) 7 SCC 215 , it was held that it is no doubt true that the Courts have to be very careful while exercising the power under Section 482 CrPC. At the same time we should not allow a litigant to file vexatious complaints to otherwise settle their scores by setting the criminal law into motion, which is a pure abuse of process of law and it has to be interdicted at the threshold. In Gunmala Sales (P) Ltd. v. Anu Mehta, (2015) 1 SCC 103 , it was held that no restriction can be placed on the High Court’s powers under Section 482 of the Code. The High Court always uses and must use this power sparingly and with great circumspection to prevent inter alia the abuse of the process of the Court. There are no fixed formulae to be followed by the High Court in this regard and the exercise of this power depends upon the facts and circumstances of each case. The High Court at that stage does not conduct a mini trial or roving inquiry, but nothing prevents it from taking unimpeachable evidence or totally acceptable circumstances into account which may lead it to conclude that no trial is necessary qua a particular Director. Amanullah v. State of Bihar, (2016) 6 SCC 699 , in which it was held that the power vested in the High Court under Section 482 CrPC, at the stages referred to hereinabove, would have far-reaching consequences inasmuch as it would negate the prosecution’s/complainant’s case without allowing the prosecution/complainant to lead evidence. Such a determination must always be rendered with caution, care and circumspection. To invoke its inherent jurisdiction under Section 482 CrPC the High Court has to be fully satisfied that the material produced by the accused is such that would lead to the conclusion that his/their defence is based on sound, reasonable, and indubitable facts; the material produced is such as would rule out and displace the assertions contained in the charges levelled against the accused; and the material produced is such as would clearly reject and overrule the veracity of the allegations contained in the accusations levelled by the prosecution/complainant. It should be sufficient to rule out, reject and discard the accusations levelled by the prosecution/complainant, without the necessity of recording any evidence. It should be sufficient to rule out, reject and discard the accusations levelled by the prosecution/complainant, without the necessity of recording any evidence. For this the material relied upon by the defence should not have been refuted, or alternatively, cannot be justifiably refuted, being material of sterling and impeccable quality. The material relied upon by the accused should be such as would persuade a reasonable person to dismiss and condemn the actual basis of the accusations as false. In such a situation, the judicial conscience of the High Court would persuade it to exercise its power under Section 482 CrPC to quash such criminal proceedings, for that would prevent abuse of process of the Court, and secure the ends of justice. 14. In ARCI v. Nimra Cerglass Technics (P) Ltd., (2016) 1 SCC 348 and Bobbili Ramakrishna Raja Yadad v. State of A.P., (2016) 3 SCC 309 , held that when a prosecution at the initial stage was asked to be quashed, the test to be applied by the Court was as to whether the uncontroverted allegations as made in the complaint prima facie establish the offence. It was also for the Court to take into consideration any special feature which appears in a particular case to consider whether it was expedient and in the interest of justice to permit a prosecution to continue. This was so on the basis that the Court cannot be utilised for any oblique purpose and where in the opinion of the Court chances of an ultimate conviction are bleak and therefore, no useful purpose was likely to be served by allowing a criminal prosecution to continue, the Court may while taking into consideration the special facts of a case also quash the proceedings even though it may be at a preliminary stage. Similar view has been taken in Mahavir Prashad Gupta v. State of National Capital Territory of Delhi, (2000) 8 SCC 115 ; State of Karnataka v. M Devendrappa, (2002) 3 SCC 89 and Padal Venkata Rama Reddy @ Ramu v. Kovvuri Satyanarayana Reddy, 2011 (3) JIC 465 (SC); Arun Bhandari v. State of U.P., (2013) 2 SCC 801 . 15. Similar view has been taken in Mahavir Prashad Gupta v. State of National Capital Territory of Delhi, (2000) 8 SCC 115 ; State of Karnataka v. M Devendrappa, (2002) 3 SCC 89 and Padal Venkata Rama Reddy @ Ramu v. Kovvuri Satyanarayana Reddy, 2011 (3) JIC 465 (SC); Arun Bhandari v. State of U.P., (2013) 2 SCC 801 . 15. From the aforementioned cases it is clear that Section 202 of the Code has twin objects; one, to enable the Magistrate to scrutinise carefully the allegations made in the complaint with a view to prevent a person named therein as accused from being called upon to face an unnecessary, frivolous or meritless complaint and the other, to find out whether there is some material to support the allegations made in the complaint. High Court in exercise of supervisory jurisdiction under Section 482 Cr.P.C. can also examine every case on same parameter i.e. whether the complaint disclosed an offence and there is some material to support the allegations made in the complaint? Although at this stage, defence set up by the accused cannot be examined but in an appropriate case a document, in the shape of public document or the materials which are beyond suspicion of doubt placed by the accused can be examined as held in Anita Malhotra v. Apparel Export Promotion Council, (2012) 1 SCC 520 . If aforesaid facts are lacking then it is the judicial obligation on the High Court to undo a wrong in course of administration of justice or to prevent continuation of unnecessary judicial process. 16. In substance, the complaint has been filed on the allegations (i) The applicants induced and offered various allurements to the complainant to join with their business, saying that he would be given complete management and financial control to run an iron and steel plant and in lieu of which the complainant would get 50% ownership rights in The Company WMI, in Saudi Arabia beside 50% share in profits and 10% share in management fee and would gain immensely. They induced the complainant to render his expertise, confidential technical and business models, trade, knowledge, cost profit analysis formulas, expertise technical knowhow, contracts, management styles, employees etc. of his personal self and of M/S. Supreme Alloys Ltd. and achieve production levels in M/S SHARQIA and convert WMI a loss making company to a profit making company. They induced the complainant to render his expertise, confidential technical and business models, trade, knowledge, cost profit analysis formulas, expertise technical knowhow, contracts, management styles, employees etc. of his personal self and of M/S. Supreme Alloys Ltd. and achieve production levels in M/S SHARQIA and convert WMI a loss making company to a profit making company. The applicants presented a very rosy picture and assured the complainant that since they were citizens of India and the complainant could have supreme confidence in their representations. The applicants boasted of their big contacts in Saudi Arabia and undertook to comply all statutory and regulatory compliances in Saudi Arabia. By way of Board Resolution dated 18.7.2012, the applicants issued 1250 share certificates to the complainant and his nominee. They also undertook not withdraw their investments in the credit line of around SAR 9,637,000/- and convert the same into equity (if required) with equal equity issued in complainant’s favour without any consideration from complainant’s side. The applicants also passed another resolution dated 18.7.2012 where under they undertook that complainant would be made a joint signatory in the Bank account of WMI and pass financial control of WMI would pass in complainant’s favour. Under the Resolution dated 18.7.2012, complainant and his nominee Sahil Arora were appointed as Director in WMI and were assured that now they will get the full management control of WMI. The complainant, on the above allurements and relying upon Board Resolutions dated 18.7.2012, parted with his and M/s Supreme Alloy’s valuable confidential technical and business models, trade knowledge, cost-profit analysis formulas, expertise, technical knowhow, contracts, management models. Later on it was found that the above documents were executed by the applicants under a well planned criminal conspiracy hatched by all of them, with a pre-planned motive to dupe the complainant of his profits, investments and confidential data. The complainant realized that neither the complainant nor his team was issued work permits, government authorizations despite submitting all requisite papers to accused persons. The share issued to the complainant and his nominee were not registered with Saudi Arabia General Investment Authority nor their signatures were introduced/attested for the bank account of the Company WMI. Investment visa and work visa were not issued to the complainant and his nominee. The share issued to the complainant and his nominee were not registered with Saudi Arabia General Investment Authority nor their signatures were introduced/attested for the bank account of the Company WMI. Investment visa and work visa were not issued to the complainant and his nominee. (ii) At that time cost of the share issued to the complainant was SAR -2231.193/- Total liability on the shareholders of WMI on 31.12.2011 was SAR 68.27 lakhs and value of share of WMI was SAR -5462.38. For the aforesaid reasons the complainant was very reluctant to invest his valuables in Saudi Arabia. (iii) Due to efforts made by the complainants and his company, gross income of WMI was increased from SAR 59.76 lakhs in year 2011 to SAR 87.82 lakhs in year 2012. The applicants transferred SAR 60 lakhs to SHARQIA. (iv) Alok Chandra and Tanvir Bukhari have also withdrew an amount of SAR 9/- lakhs. 17. Grounds (iii) and (iv), are related to accounts of the business and do not create any criminal liabilities. Grounds (i) and (ii) in substance were that WMI company was running in loss and the complainant, who had vast experience and expertise of manufacture steel ingots etc. was induced by the applicants to join their business by rendering his expertise, confidential technical and business models, trade, knowledge, cost profit analysis formulas, expertise technical knowhow, contracts, management styles, employees etc. of his personal self and of M/S. Supreme Alloys Ltd. He was given 50% ownership rights (i.e. 50% shareholding) in WMI beside 50% share in profits and 10% share in management fee in lieu of it. 18. Some clauses of MOU dated 18.7.2012 executed between the parties, which are relevant for deciding this controversy are reproduced below : WHEREAS 1. The Company has entered into ‘Lease Ended with ownership Agreement on 29th day of July, 2010 with Mr. Abdulaziz Al Tuwejri, Mr. Majid Abdulaziz Al Tuvejri and Mr. Badr Abdulaziz Al Tuwejri (hereinafter referred to as the “Agreement”) all citizens of Kingdom of Saudi Arabia, the owners of ‘SHARQIA’(defined below), having manufacturing facility licensed to manufacture iron and steel articles, to take on lease the entire factory and purchase 100% ownership of ‘SHARQIA’, on full payment of the agreed amount, acquiring thereby on an outright basis, the owners title, rights (present & future), interests, etc. and the entire “assets’ of SHARQIA on ‘as is where is’ basis, free of all liabilities and a copy of the Agreement has been shared with the Strategic Partner. 2. The Company is undertaking production in ‘SHARQIA’ and has achieved capacity utilization of around 1200 mt. Per month on a single shift basis and having regard to the increasing demand for the Company’s products, need for funds and managing the affairs of the Company, it is desired by the Current owners and by the Company that a strategic partner be introduced in the Company to take forward the company to the next level. 3. The current Owners have chosen to enter into a joint venture with the Strategic Partner as he has the requisite expertise in setting up and managing steel plants in India and has sufficient finances to meet the requirements for expansion and operation of the same. 2.5 The Strategic partner and the Current Owners shall own the Company on a 50:50 basis with management of the Company including day to day affairs like purchase of raw material, consumables, fixed assets, etc., sale of finished goods, production and expansion activities, administration, financial management, etc. being with the Strategic Partner Shares equivalent to 26% of the equity shall be issued to the strategic partner by the company within 15 days from the signing of the MOU and balance 24% within the period of 45 days from the signing of this MOU to achieve a 50:50 shareholding between the current owners(second part) and strategic Partner(third part). The Managing director, who shall be nominated by the strategic partner shall be having overall responsibility of running the affairs of the company. 2.6. In order to facilitate the expeditious acquisition of the legal and beneficial ownership of 50% of the enhanced share capital of the Company, the company shall issue fresh shareholding equivalent to the current shareholding to the strategic partner in accordance with clause 2.9. Any increase in the share capital of the company shall be done with the written approval of the strategic partner and the current owners. 2.7. The subscription monies paid by strategic Partner in terms of clause 2.6 above alongwith all investments made for the up-gradation of production facilities including working capital shall be utilized by the Company, inter alia, in augmenting its capacity to produce steel from 1200 mt. per month to 3500 mt. 2.7. The subscription monies paid by strategic Partner in terms of clause 2.6 above alongwith all investments made for the up-gradation of production facilities including working capital shall be utilized by the Company, inter alia, in augmenting its capacity to produce steel from 1200 mt. per month to 3500 mt. per month and this augmentation shall be achieved by Strategic Partner within a period of nine months from the effective date. 2.25 On the execution of this agreement all funds belonging to any of the current owners or the Strategic Partner shall be treated as grant to the company and shall not be used to issue any equity to any of the current owners or the Strategic Partner in order to maintain the shareholding balance set out in this MOU. 19. These controversies can be decided on the basis of MOU dated 18.7.2012 and subsequent conduct of the parties. It was a written contract as such apart from MOU dated 18.7.2012, no other evidence in this respect is admissible in evidence in view of Section 92 of Evidence Act, 1872 as well as clause 9.1 of this MOU. From the aforesaid documents it is proved that it was agreed between the parties that the complainant (the Strategic Partner) has to render his expertise for managing the manufacturing unit of the applicants and also to invest money up to extent of 50% enhanced share to meet the requirements for expansion and operation of the same. From aforementioned clauses it is clear that the complainant was not only required to render his expertise in managing steel plant of the Company WMI but he was also required to invest 50% enhanced share capital to meet the requirements for expansion and operation of the same. Company of opposite party-2 also passed a resolution dated 26.11.2012 for purchasing 50% share and making investment in the Company WMI. But opposite party-2 and his nominee has not invested the amount of share capital although share certificate had been issued to them. From the terms of MOU and subsequent conduct of the parties it is fully proved that this was a fair business transaction between the parties, under which opposite party-2 was not only required to manage the business according to his expertise etc. but also to invest money equal to share capital of the Company WMI, so that production limit could be enhanced to 3500 mt. but also to invest money equal to share capital of the Company WMI, so that production limit could be enhanced to 3500 mt. Per month from 1200 mt. Per month. 20. Section 405 IPC defines criminal breach of trust, which is quoted below:- “Section 405. Criminal breach of trust.—Whoever, being in any manner entrusted with property, or with any dominion over property, dishonestly misappropriates or converts to his own use that property, or dishonestly uses or disposes of that property in violation of any direction of law prescribing the mode in which such trust is to be discharged, or of any legal contract, express or implied, which he has made touching the discharge of such trust, or wilfully suffers any other person so to do, commits ‘criminal breach of trust’.” In Hari Prasad Chamaria v. Bishun Kumar Surekha, (1973) 2 SCC 823 , it has been held that 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 of Drang Transport Corporation 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. 21. In Medchl Chemicals & Pharma (P) Ltd. v. Biological E. Ltd., (2000) 3 SCC 269 , in which it has been held that in order to attract the provisions of Sections 418 and 420 the guilty intent, at the time of making the promise is a requirement and an essential ingredient thereto and subsequent failure to fulfil the promise by itself would not attract the provisions of Section 418 or Section 420. Mens rea is one of the essential ingredients of the offence of cheating under Section 420. Mens rea is one of the essential ingredients of the offence of cheating under Section 420. As a matter of fact Illustration (g) to Section 415 makes the position clear enough to indicate that mere failure to deliver in breach of an agreement would not amount to cheating but is liable only to a civil action for breach of contract. We, however, hasten to add that whether or not the allegations in the complaint are otherwise correct has to be decided on the basis of the evidence to be led at the trial in the complaint case but simply because of the fact that there is a remedy provided for breach of contract, that does not by itself clothe the Court to come to a conclusion that civil remedy is the only remedy available to the appellant herein. Both criminal law and civil law remedy can be pursued in diverse situations. 22. In Indian Oil Corpn. v. NEPC India Ltd., (2006) 6 SCC 736 , it has been held that a careful reading of the Section shows that a criminal breach of trust involves the following ingredients: (a) a person should have been entrusted with property, or entrusted with dominion over property; (b) that person should dishonestly misappropriate or convert to his own use that property, or dishonestly use or dispose of that property or wilfully suffer any other person to do so; (c) that such misappropriation, conversion, use or disposal should be in violation of any direction of law prescribing the mode in which such trust is to be discharged, or of any legal contract which the person has made, touching the discharge of such trust. The following are examples (which include the illustrations under Section 405) where there is “entrustment”: 23. Section 415 IPC, which defines cheating is quoted below: “Section 415. Whoever, by deceiving any person, fraudulently or dishonestly induces the person so deceived to deliver any property to any person, or to consent that any person shall retain any property, or intentionally induces the person so 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, is said to ‘cheat’. Explanation.—A dishonest concealment of facts is a deception within the meaning of this Section.” 24. In Hridaya Ranjan Prasad Verma v. State of Bihar, (2000) 4 SCC 168 , held that the Section requires— (1) deception of any person; (2)(a) fraudulently or dishonestly inducing that person (i) to deliver any property to any person, or (ii) (ii) to consent that any person shall retain any property; or (b) intentionally inducing that person 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. On a reading of the Section it is manifest that in the definition there are set forth two separate classes of acts which the person deceived may be induced to do. In the first place he may be induced fraudulently or dishonestly to deliver any property to any person. The second class of acts set forth in the Section is the doing or omitting to do anything which the person deceived would not do or omit to do if he were not so deceived. In the first class of cases the inducing must be fraudulent or dishonest. In the second class of acts, the inducing must be intentional but not fraudulent or dishonest. In determining the question it has to be kept in mind that the distinction between mere breach of contract and the offence of cheating is a fine one. It depends upon the intention of the accused at the time of inducement which may be judged by his subsequent conduct but for this subsequent conduct is not the sole test. Mere breach of contract cannot give rise to criminal prosecution for cheating unless fraudulent or dishonest intention is shown right at the beginning of the transaction, that is the time when the offence is said to have been committed. Therefore it is the intention which is the gist of the offence. To hold a person guilty of cheating it is necessary to show that he had fraudulent or dishonest intention at the time of making the promise. From his mere failure to keep up promise subsequently such a culpable intention right at the beginning, that is, when he made the promise cannot be presumed. To hold a person guilty of cheating it is necessary to show that he had fraudulent or dishonest intention at the time of making the promise. From his mere failure to keep up promise subsequently such a culpable intention right at the beginning, that is, when he made the promise cannot be presumed. In Rashmi Jain v. State of U.P., (2014) 13 SCC 553, held that in order to constitute an offence of cheating, the intention to deceive should be in existence at the time when the inducement was made. It is necessary to show that a person had fraudulent or dishonest intention at the time of making the promise, to say that he committed an act of cheating. A mere failure to keep up promise subsequently cannot be presumed as an act leading to cheating.” 25. So far as allegations about valuable confidential technical and business models, trade knowledge, cost-profit analysis formulas, expertise, technical knowhow, contracts, management models of the complainant is concerned, it were not a tangible property nor were ever handed over/entrusted to the applicants. It was always remained with the complainant. On its basis the applicants could not be punished either for breach of trust or for cheating. 26. As held above, in the present case, the complainant was required to invest money of 50% enhanced shareholding in the Company WMI under MOU dated 18.7.2012. Admittedly the complainant did not invest any amount. Due to which he or his nominee could not get legal status of shareholders in the company as such neither investment visa nor work visa could be issued to them. At the time of entering into agreement dated 18.7.2012 all the status of the Company WMI and the current owners were disclosed in the MOU itself. There was no concealment on the part of the applicant. Fare offer has been accepted by the complainant and there was no element of cheating at that time. The complaint does not disclose any offence. Other allegations are merely a contractual obligations and criminal liability is made out on its basis. In any case, the offer to join in the business of the applicants has been accepted by opposite party-2 and a written agreement in shape of MOU dated 18.7.2012, was executed by them. 27. In view of the aforesaid discussions, the applications succeed and are allowed. In any case, the offer to join in the business of the applicants has been accepted by opposite party-2 and a written agreement in shape of MOU dated 18.7.2012, was executed by them. 27. In view of the aforesaid discussions, the applications succeed and are allowed. The summoning order and order of bailable warrant passed by Additional Chief Judicial Magistrate 1st, Gautam Budh Nagar dated 25.5.2015 and 2.7.2015, respectively against the applicants in Complaint Case No. 1419 of 2015, J.K. Arora v. Alok Chandra and others, under Section 406, 420, 467, 468, 471, 120-B IPC, PS Badalpur, district Gautam Budh Nagar as well as entire proceeding of the complaint case are hereby quashed.