Premature prosecution for alleged income concealment cannot continue until assessment conclusively determines concealment.

A prosecution for filing false returns and concealing income could not proceed while the relevant assessment remained unfinished and the question of concealment had not been conclusively determined by the income-tax authority. The Court held that the criminal court could not itself assess income or presume concealment before the statutory assessment process was completed. Any final finding on concealment, including the effect of alleged admissions in settlement correspondence, had to arise first in assessment proceedings. The complaint was therefore quashed as premature, though it could be revived if the original assessment was later restored.

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Issues: Whether a prosecution for filing false returns and concealing income could proceed before the assessment for the relevant year had been finally completed and the question of concealment had been conclusively determined by the income-tax authorities.

Analysis: The complaint rested on the premise that the petitioners had concealed income and filed false returns, but the assessment for the relevant year had been set aside and was still to be made afresh. The Court held that the criminal court could not undertake the assessment itself or presume concealment before the income-tax authority had completed its statutory function. Any final finding on concealment, including the effect of alleged admissions made in settlement correspondence, had first to be considered in the assessment proceedings. The possibility that the department might later succeed in reference proceedings was not a ground to keep the prosecution alive indefinitely, because the complaint could be revived if the original assessment were ultimately restored.

Conclusion: The prosecution was premature and could not continue at that stage. The complaint was quashed, leaving liberty to revive it if the original assessment was later upheld.

Final Conclusion: Criminal liability for concealment could not be pursued until the assessment proceedings reached a concluded stage, and the pending complaint was therefore set aside, subject to revival on a future restoration of the original assessment.

Ratio Decidendi: A prosecution for concealment of income cannot proceed when the foundation of the alleged offence depends on an assessment that has not yet been finally completed, because the existence of concealment must first be determined in the statutory assessment process.

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