Prima facie tax evasion complaints can survive quashing where allegations disclose concealment and wilful attempt to evade tax.

At the quashing stage, a criminal complaint under the Income-tax Act is tested only for whether its averments, taken at face value, disclose the basic ingredients of the alleged offences; a detailed evidentiary inquiry is impermissible. On that approach, allegations that business transactions and demand drafts were omitted from the accounts, that incomplete figures were used in assessment, and that the conduct was aimed at concealing identity and evading tax were sufficient to sustain prima facie prosecution for wilful attempt to evade tax and allied offences. The absence of a completed assessment under section 69C, and arguments drawn from section 271(1)(c), did not defeat the criminal complaints.

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Issues: Whether the criminal complaints under the Income-tax Act disclosed a prima facie case so as to justify refusal to quash the prosecutions, and whether the absence of a completed assessment process under section 69C barred continuation of the prosecutions.

Analysis: At the stage of quashing, the Court is required to examine only whether the averments in the complaints, taken at face value, disclose the basic ingredients of the alleged offences. Detailed appreciation of evidence, or a final determination whether the transactions represented income, unexplained expenditure, or concealed business receipts, is not permissible at that stage. The complaints alleged that business transactions and demand drafts were omitted from the account books, that the assessments proceeded on incomplete figures, and that the transactions were designed to conceal identity and evade tax. Those allegations, if proved, were capable of attracting the offence of wilful attempt to evade tax and the allied offences alleged in the complaints. The availability of section 69C in assessment proceedings, or the argument based on section 271(1)(c), did not negate the prima facie criminal allegations.

Conclusion: The complaints disclosed sufficient prima facie material to proceed with trial, and the petitions for quashing were not maintainable.

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