ORDER : 1. This petition under Section 482 of Criminal Procedure Code (for short ‘Cr.P.C’) is filed to quash the order passed by XI Additional District and Sessions Judge, Krishna, Gudivada, in Criminal Revision Petition No.62 of 2009 dated 11.06.2012, confirming the order passed by Additional Judicial Magistrate of First Class, Gudivada in C.F.No.6937/2008 dated 08.07.2009, whereby the complaint was dismissed, having found that it is a case of civil nature. 2. The petitioner filed a private complaint before the Additional Judicial Magistrate of First Class, Gudivada against five accused, alleging that accused No.1 used to receive stocks of boiled rice from the complainant, on the basis of consignment sale and as per the terms agreed between the complainant and the accused, accused No.1, after receiving a consignment from the complainant has to store the said received boiled rice stock in its godown at their place, maintain it in good condition and sell the same to the parties. Accused No.1 has to repay the price of the stock to the complainant, after deducting expenses incurred by it for storage, carting expenses, insurance and its business commission besides bank charges. In this manner, accused No.1 is entrusted with the stocks of boiled rice from time to time and then the stocks are kept in the custody of accused No.1 for sale under consignment basis. Until the sale of supplied boiled rice is completed to actual purchasers from M/s. Balaji Rice Trading Company, the complainant remains the owner of the property. Thus each consignment of boiled rice is entrusted to the accused with a condition to sell the same, after deducting the stipulated commission and return the balance of sale proceeds to the complainant. Accused No.3 approached the complainant and on belief that himself and other accused are doing the above said business and requested for supply of boiled rice to them under consignment basis. All the accused in a cleverly designed manner, received different consignments of boiled rice from time to time, started keeping a substantial amount with them, showing it as due to the complainant, in spite of selling the stock of boiled rice to customers and receiving full payments from them. The accused have diverted the sale proceeds and utilized the same for their own individual needs, without the knowledge of complainant. Thereby the amount due from accused No.1 company is Rs.70,32,617/-as on 01.04.2005. The accused have diverted the sale proceeds and utilized the same for their own individual needs, without the knowledge of complainant. Thereby the amount due from accused No.1 company is Rs.70,32,617/-as on 01.04.2005. Accused Nos.2 to 5 on behalf of accused No.1 were making small payments towards the outstanding due and retaining substantial amount with a view to have wrongful gain for themselves. Thus, by 02.09.2005 accused No.1 acting through accused Nos.2 to 5 are due to pay an amount of Rs.38,36,978/-towards sale proceeds of boiled rice. 3. The complainant got issued registered legal notice to accused Nos.2 to 5, but accused Nos.2 and 5 only received the notice and got issued reply with false allegations. The complainant filed a private complaint on 20.02.2006 and the court forwarded the same to the Station House Officer, Gudivada Taluk P.S under Section 156 (3) of Cr.P.C. Later the police registered a case in Crime No.31 of 2006. 4. The learned Magistrate, recorded the statements of witnesses and concluded that there is no material to proceed against this petitioner for any of the offence and dismissed the complaint by order dated 08.07.2009. The order was challenged before the District Court in Criminal Revision Petition No.62 of 2012, the learned District and Sessions Judge by order dated 11.07.2012 dismissed the complaint affirming the order of Magistrate, on the ground that the dispute is purely civil in nature, for recovery of amount due towards the price of the rice supplied by this petitioner and it is only civil liability of the respondents. 5. Aggrieved by the order, the present petition is filed on the ground that both the trial court and revisional court did not consider the material in right perspective, the statements were also not considered properly and committed an error in dismissing the complaint and also contended that failure to pay price of the rice amount to breach of trust. But the court below did not appreciate this contention in proper perspective and committed an error in dismissing the complaint and the same is affirmed, erroneously by the revisional court and requested to allow the petition. 6. During hearing, the learned Counsel for the petitioner Sri V.R Avula, reiterated the contentions urged in the petition. But the court below did not appreciate this contention in proper perspective and committed an error in dismissing the complaint and the same is affirmed, erroneously by the revisional court and requested to allow the petition. 6. During hearing, the learned Counsel for the petitioner Sri V.R Avula, reiterated the contentions urged in the petition. Whereas the learned Counsel for the respondents Sri K. Chidambaram, supported the order passed by the court, by contending that it is purely a civil dispute and at best, it is only a breach of contract and that there is registered correspondence between the parties regarding the liability for payment of price of rice supplied etc., Therefore, there are no grounds to set aside the order and requested to dismiss the petition. 7. According to the petitioner, there was no breach of trust between the petitioner and accused and in the absence of any allegation regarding relationship of trustee and beneficiary, investigation cannot be proceeded against the accused. A breach of contract is distinguishable from breach trust. A similar question came up before the Apex Court in Indian Oil Corporation v. NEPC Ltd., and others, [(2006) 6 Supreme Court Cases 736], where the Apex Court discussed when breach of trust amounts to offence. The Supreme Court further held that criminal breach of trust involves the following ingredients: a) a person should have been entrusted with property, or entrusted with domination 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 willfully 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 of I.P.C where there is ‘entrustment’: (i) An ‘Executor of a Will, with reference to the estate of the deceased bequeathed to legatees. (ii) A ‘Guardian’ with reference to a property of a minor or person of unsound mind. (iii) A ‘Trustee’ holding a property in trust, with reference to the beneficiary. (iv) A ‘Warehouse keeper’ with reference to the goods stored by a depositor. (ii) A ‘Guardian’ with reference to a property of a minor or person of unsound mind. (iii) A ‘Trustee’ holding a property in trust, with reference to the beneficiary. (iv) A ‘Warehouse keeper’ with reference to the goods stored by a depositor. (v) A carrier with reference to goods entrusted for transport belonging to the consignor/consignee. (vi) A servant or agent with reference to the property of the master or principal. (vii) A pledge with reference to the goods pledged by the owner/borrower. (viii) A debtor, with reference to a property held in trust on behalf of the creditor in whose favour he has executed a deed of pledge-cum-trust. (Under such a deed, the owner pledges his movable property, generally vehicle/machinerty to the creditor, thereby delivering possession of the movable property to the creditor and the creditor in turn delivers back the pledged movable property to the debtor, to be held in trust and operated by the debtor). But, the present case would not fall within the eight examples under Section 405 of I.P.C referred above. 8. In Chelloor Mankkal Narayan Ittiravi Nambudiri v. State of Travancore, Cochin, [ AIR 1953 SC 478 ], the Apex Court held as follows : “to constitute an offence of criminal breach of trust, it is essential that the prosecution must prove first of all that the accused was entrusted with some property or with any dominion or power over it. It has to be established further that in respect of the property so entrusted, there was dishonest misappropriation or dishonest conversion or dishonest use or disposal in violation of a direction of law or legal contract, by the accused himself or by someone else which he willingly suffered to do”. It follows almost axiomatically from this definition that the ownership or beneficial interest in the property in respect of which criminal breach of trust is alleged to have been committed, must be in some person other than the accused and the latter must hold it on account of some person or in some way for his benefit. It follows almost axiomatically from this definition that the ownership or beneficial interest in the property in respect of which criminal breach of trust is alleged to have been committed, must be in some person other than the accused and the latter must hold it on account of some person or in some way for his benefit. In Jaswantrai Manilal Akhaney v. State of Bombay, [ AIR 1956 SC 575 ], the Apex Court reiterated that the first ingredient to be proved in respect of a criminal breach of trust is ‘entrustment’ and held as follows: “…S. 405 which defines “criminal breach of trust” speaks of a person being in any manner entrusted with property, it does not contemplate the creation of a trust with all the technicalities of the law of trust. It contemplates the creation of a relationship whereby the owner of property makes it over to another person to be retained by him until a certain contingency arises or to be disposed of by him on the happening of a certain event”. In Nagawwa v. Veeranna Shivalingappa Kojalgi, [ (1976) 3 SCC 736 ], the Apex Court held that the appellant has no case that the respondents obtained the article by any fraudulent inducement or by willful misrepresentation, it would not attract offence punishable under Section 420 of I.P.C. 9. In the present case also except using the word ‘deceit’ and ‘in conspiracy’, no material is brought on record about establishing criminal breach of trust as defined under Section 405 of I.P.C to proceed against the petitioners for the offence punishable under Section 406 of I.P.C. In the absence of any prima facie material supporting before this Court, regarding the words ‘deceit’ and ‘in conspiracy’, which are mentioned in the private complaint, the proceedings against the petitioners for the offence under Section 406 of I.P.C and cannot be continued. The other offence allegedly committed by the petitioners is punishable under Section 420 of I.P.C i.e. Cheating and dishonestly inducing delivery of property. The other offence allegedly committed by the petitioners is punishable under Section 420 of I.P.C i.e. Cheating and dishonestly inducing delivery of property. But, the word ‘cheating’ is defined under Section 415 of I.P.C as follows : “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"” The explanation to Section 415 of I.P.C specifies that a dishonest concealment of facts is a deception within the meaning of this section. Hence, to constitute an offence punishable under Section 420 of I.P.C, there must be a dishonest intention. 10. Learned counsel for the petitioners while contending that there must be an intention at the initial stage to make such an inducement with such fraudulent intention to part with any property. Otherwise, it would not fall within the ambit of Section 420 of I.P.C and placed reliance on ALPIC Finance Ltd v. P. Sadasivan and another, [ (2001) 3 SCC 513 ] case, the Supreme Court reiterated the ingredients of the offences punishable under Section 420 I.P.C and held in paragraph 10 as follows : “The facts in the present case have to be appreciated in the light of the various decisions of this Court. When somebody suffers injury to his person, property or reputation, he may have remedies both under civil and criminal law. The injury alleged may form basis of civil claim and may also constitute the ingredients of some crime punishable under criminal law. When there is dispute between the parties arising out of a transaction involving passing of valuable properties between them, the aggrieved person may have right to sue for damages or compensation and at the same time, law permits the victim to proceed against the wrongdoer for having committed an offence of criminal breach of trust or cheating. When there is dispute between the parties arising out of a transaction involving passing of valuable properties between them, the aggrieved person may have right to sue for damages or compensation and at the same time, law permits the victim to proceed against the wrongdoer for having committed an offence of criminal breach of trust or cheating. Here the main offence alleged by the appellant is that respondents committed the offence under Section 420 I.P.C. and the case of the appellant is that respondents have cheated him and thereby dishonestly induced him to deliver property. To deceive is to induce a man to believe that a thing is true which is false and which the person practicing the deceit knows or believes to be false. It must also be shown that there existed a fraudulent and dishonest intention at the time of commission of the offence. There is no allegation that the respondents made any willful misrepresentation. Even according to the appellant, parties entered into a valid lease agreement and the grievance of the appellant is that the respondents failed to discharge their contractual obligations. In the complaint, there is no allegation that there was fraud or dishonest inducement on the part of the respondents and thereby the respondents parted with the property. It is trite law and common sense that an honest man entering into a contract is deemed to represent that he has the present intention of carrying it out but if, having accepted the pecuniary advantage involved in the transaction, he fails to pay his debt, he does not necessarily evade the debt by deception.” In V.Y. Jose v. State of Gujarat, [(2009) 3 Supreme Court Cases 78], the Apex Court highlighted the ingredients to constitute an offence punishable under Section 420 I.P.C in paragraph 14 and they are as follows: “An offence of cheating cannot be said to have been made out unless the following ingredients are satisfied: i) deception of a person either by making a false or misleading representation or by other action or omission; (ii) fraudulently or dishonestly inducing any person to deliver any property; or (iii) To consent that any person shall retain any property and finally intentionally inducing that person to do or omit to do anything which he would not do or omit. For the purpose of constituting an offence of cheating, the complainant is required to show that the accused had fraudulent or dishonest intention at the time of making promise or representation. Even in a case where allegations are made in regard to failure on the part of the accused to keep his promise, in absence of a culpable intention at the time of making initial promise being absent, no offence under Section 420 of the Indian Penal Code can be said to have been made out." 11. The Apex Court in V.Y. Jose (6th cited supra) case concluded that there exists a distinction between pure contractual dispute of civil nature and an offence of cheating. Although breach of contract per se would not come in the way of initiation of a criminal proceeding, there cannot be any doubt whatsoever that in absence of the averments made in the complaint petition wherefrom the ingredients of an offence can be found out, the court should not hesitate to exercise its jurisdiction under Section 482 of the Code of Criminal Procedure. Section 482 of the Code of Criminal Procedure, saves the inherent power of the court. It serves a salutary purpose viz. a person should not undergo harassment of litigation for a number of years although no case has been made out against him. Thus, the Court can exercise its inherent power when the case on hand is purely a civil in nature and quash the proceedings to avoid harassment of the parties insisting their attendance before the Court on every dates of adjournment before the Court for years together. In a similar situation the Supreme Court in Thermax Limited and others v. K.M Johny and others, [(2011) 13 Supreme Court Cases 412], held as follows : “34. The principles enunciated from the above-quoted decisions clearly show that for proceedings under Section 156(3) of the Code, the complaint must disclose relevant material ingredients of Sections 405, 406, 420 read with Section 34 IPC. If there is a flavour of civil nature, the same cannot be agitated in the form of criminal proceeding. If there is huge delay and in order to avoid the period of limitation, it cannot be resorted to a criminal proceeding. 42. If there is a flavour of civil nature, the same cannot be agitated in the form of criminal proceeding. If there is huge delay and in order to avoid the period of limitation, it cannot be resorted to a criminal proceeding. 42. We have already noted that the offence alleged in the criminal complaint filed by Respondent No. 1 is under Sections 405 and 420 IPC where under no specific liability is imposed on the officers of the company, if the alleged offence is by the Company. In the absence of specific details about the same, no person other than Appellant No. 1-Company can be prosecuted under the alleged complaint. 49. The entire analysis of the complaints with reference to the principles enunciated above and the ingredients of Sections 405, 406, 420 read with Section 34 IPC clearly show that there was inordinate delay and laches, the complaint itself is inherently improbable contains the flavour of civil nature and taking note of the closure of earlier three complaints that too after thorough investigation by the police, we are of the view that the Magistrate committed a grave error in calling for a report under Section 156(3) of the Code from the Crime Branch, Pune. In view of those infirmities and in the light of Section 482 of the Code, the High Court ought to have quashed those proceedings to safeguard the rights of the Appellants. For these reasons, the order passed by the Judicial Magistrate First Class, Pimpri in CC No. 12 of 2002 on 20.08.2007 and the judgment of the High Court dated 11.01.2008 in Criminal Writ Petition No. 1622 of 2007 are set aside. The complaint filed by Respondent No. 1 herein is quashed.” 12. An identical question came up before the Apex Court in Anil Mahajan v. Bhor Industries, [ 2005 (10) SCC 228 ], where the parties entered into Memorandum of Understanding for supply of steel grip tapes stipulating that 50% of the payments against monthly quantity would be given in advance and balance 50% on receipt of the goods in pursuance of the Memorandum of Understanding, the complainant delivered. In the said case, the complainant delivered 56,94,120 reels of steel grip tapes valued at Rs. 3,38,62,860 to the accused during the period 19.8.2000 to 20.11.2000 and out of this amount, the accused made only part payment of Rs. 3,05,39,086 leaving balance amount of Rs. 33,23,774. In the said case, the complainant delivered 56,94,120 reels of steel grip tapes valued at Rs. 3,38,62,860 to the accused during the period 19.8.2000 to 20.11.2000 and out of this amount, the accused made only part payment of Rs. 3,05,39,086 leaving balance amount of Rs. 33,23,774. The accused did not make further payment despite repeated demands and started giving reasons such as cash flow problems, non-receipt of right type of colour assortment and sales tax problems, etc., besides raising disputes in respect of the material purchased six years back being defective. Based on the contents of the Memorandum of Understanding, the company filed a complaint against the petitioner for the offences punishable under Sections 415, 418 & 420 I.P.C and the Court took cognizance of it and the same is challenged before the Court. In paragraphs 6, 7 & 8 of the said judgment, the Court held as under: 6. “Reliance has been placed, in that order, on various decisions of this Court holding that from mere failure of a person to keep up promise subsequently, a culpable intention right at the beginning that is, when he made the promises cannot be presumed. A distinction has to be kept in mind between mere breach of contract and the offence of cheating. It depends upon the intention of the accused at the time of inducement. The subsequent conduct is not the sole test. Mere breach of contract cannot give rise to criminal prosecution for cheating unless fraudulent, dishonest intention is shown at the beginning of the transaction. 7. The order of the learned Additional Sessions Judge has been set aside by the High Court by the impugned judgment. The High Court, except noticing that the ratio of the judgment of this Court cannot be applied to all cases in a uniform way, has neither discussed the said judgment nor stated as to how it was wrongly applied by the learned Additional Sessions Judge. There is hardly any discussion in the impugned judgment for reversing a well-considered judgment of the learned Additional Sessions Judge. 8. The substance of the complaint is to be seen. Mere use of the expression "cheating" in the complaint is of no consequence. There is hardly any discussion in the impugned judgment for reversing a well-considered judgment of the learned Additional Sessions Judge. 8. The substance of the complaint is to be seen. Mere use of the expression "cheating" in the complaint is of no consequence. Except mention of the words "deceive" and "cheat" in the complaint filed before the Magistrate and "cheating" in the complaint filed before the police, there is no averment about the deceit, cheating or fraudulent intention of the accused at the time of entering into MOU wherefrom it can be inferred that the accused had the intention to deceive the complainant to pay. According to the complainant, a sum of Rs. 3,05,39,086 out of the total amount of Rs. 3,38,62,860 was paid leaving balance of Rs. 33,23,774. We need not go into the question of the difference of the amounts mentioned in the complaint which is much more than what is mentioned in the notice and also the defense of the accused and the stand taken in reply to notice because the complainant's own case is that over rupees three crores was paid and for balance, the accused was giving reasons as above noticed. The additional reason for not going into these aspects is that a civil suit is pending inter se the parties for the amounts in question. 13. In the present case also there is no averment in the complaint regarding inducement to supply boiled rice. Further, the complaint did not disclose anything about dishonest inducement or making fraudulent misrepresentation to part with the goods at the time of entering into a contract i.e. for supply of boiled rice. In the absence of those allegations which are sine quo non to constitute an offence, the petitioners cannot be proceeded for the said offences. At the same time, the law laid down in the above judgments is directly applicable and consequently the order passed by both the courts below is liable to be sustained. 14. In view of the aforesaid discussion, this criminal petition is liable to be dismissed. 15. In the result, the petition is dismissed. 16. Consequently, miscellaneous petitions, pending if any, shall stand closed.