ORDER : Accused nos. 1 and 2 in PCR no. 8/2012 on the file of JMFC, Chikkanayakanahalli, have filed this petition under Section 482 Cr.P.C seeking to quash the entire proceedings in the said private complaint. 2. Heard the learned counsel for the petitioners and the learned HCGP. Counsel for respondent no.2 is absent. 3. Briefly stated the facts are as follows : Respondent no.2, i.e., the complainant availed loan of Rs.42,50,000/- from accused nos.1 and 2 for purchase of a Hydraulic Earth Excavator on 30.5.2008. He hypothecated the said machinery with the petitioners. After making payment of Rs.10,00,000/- towards repayment of loan, he became a defaulter due to stoppage of mining activity in Tumkur District. He himself surrendered the said machinery to the petitioners who after obtaining valuation report, sold the said machinery in public auction on 31.3.2010. The machinery was sold for an amount of Rs.32,50,000/- in the auction. The second respondent’s grievance is that the petitioners assured him that they will sell the machinery for higher price and refund the excess after deducting the amount due to them. But, he came to know that the machinery was sold for a lower price and thus he felt cheated. For this reason he initiated action under Section 200 Cr.P.C alleging offences punishable under Sections 405, 406, 420 read with Section 34 IPC. 4. Learned counsel for the petitioners argues that the loan transaction is admitted. The second respondent himself surrendered the machinery to the petitioners. Valuation report was obtained and after issuing notice to the second respondent, the said machinery was sold. Actual amount due to the petitioners was Rs.41,00,079/-. After the machinery was sold in the public auction, the amount realized in the auction was deducted from the sum actually due to the petitioners, still respondent was found due in a sum of Rs.9,22,526/-. Therefore, according to the agreement, the petitioners initiated arbitration proceeding, obtained an award and then filed execution case also. Respondent no.2 received the notice issued in the execution case and then filed a private complaint. In the facts and circumstances, no offence as alleged in the private complaint would constitute. This is a clear case of abuse of process of Court and therefore proceedings need to be quashed. 5. Learned HCGP submits that the petitioners did not sell the machinery for a higher amount as assured to the second respondent. In the facts and circumstances, no offence as alleged in the private complaint would constitute. This is a clear case of abuse of process of Court and therefore proceedings need to be quashed. 5. Learned HCGP submits that the petitioners did not sell the machinery for a higher amount as assured to the second respondent. The Magistrate referred the matter to the police for investigation in accordance with Section 156 (3) Cr.P.C. The investigation is under progress. At this stage, there are no materials to exercise jurisdiction under Section 482 Cr.P.C. 6. In the circumstances as narrated above, it can be very well said that the petitioners have acted in accordance with law. The second respondent himself surrendered the machinery to the petitioners when he could not repay the loan obtained by him from them. As per the terms of the agreement, if the petitioners sold the machinery in a public auction and appropriated the money realized in the auction to the outstanding amount due, it cannot be said that they committed an offence as alleged in the complaint. The materials also disclose that the petitioners took action in accordance with the Arbitration and Conciliation Act to realize the amount found to be due even after deducting the amount that they realized by holding the public auction. This being the facts and circumstances, if at all the second respondent is aggrieved, he has to take action in accordance with provisions of Arbitration and Conciliation Act or any other law. But, he cannot initiate action under Section 200 Cr.P.C stating that he has been cheated. Even there cannot be criminal breach of trust because the terms of the agreement provided for private sale. Therefore, the Magistrate should have applied his mind before referring the matter to the police for investigation in accordance with Section 156(3) Cr.P.C. There are no materials to proceed against the petitioners. Private complaint is a sheer abuse of process of Court. It should not be allowed to sustain. Therefore, petition deserves to be allowed. Hence, the following order: (a) Petition is allowed. (b) Proceedings in PCR no.8/2012 on the file of JMFC, Chikkanayakanahalli, are quashed.