Pending reassessment does not bar income-tax prosecution; criminal complaints remain maintainable absent an express statutory prohibition.

Pendency of reassessment or penalty proceedings under the Income-tax Act does not, by itself, bar prosecution for offences under sections 276C and 277. Section 279 creates only express statutory bars, including cases where sanction is absent or where section 273A consequences apply; a possible favourable tax outcome is not enough to prevent criminal proceedings. The criminal court must assess the offences independently on the evidence, and the complaint is not rendered premature or an abuse of process merely because reassessment remains pending. Accordingly, the prosecution was maintainable and quashing was refused.

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Issues: (i) Whether prosecution for offences under the Income-tax Act and the Indian Penal Code could be launched while reassessment proceedings under the Income-tax Act were pending; (ii) Whether such prosecution was liable to be quashed as premature or as an abuse of process.

Issue (i): Whether prosecution for offences under the Income-tax Act and the Indian Penal Code could be launched while reassessment proceedings under the Income-tax Act were pending.

Analysis: There is no provision barring institution of prosecution merely because reassessment proceedings are pending. Section 279 of the Income-tax Act, 1961 bars prosecution only in the situations expressly stated therein, including where the Commissioner has not sanctioned proceedings or where the statutory consequence of an order under section 273A applies. The possibility that the assessee may succeed in assessment or penalty proceedings does not itself prevent launch of criminal proceedings. A criminal court must determine the ingredients of the offences independently on the evidence before it, though it may take due regard of any later order under the Act where appropriate.

Conclusion: The pendency of reassessment proceedings does not bar institution of prosecution under sections 276C and 277 of the Income-tax Act, 1961.

Issue (ii): Whether such prosecution was liable to be quashed as premature or as an abuse of process.

Analysis: The mere prospect of a favourable result in the tax proceedings does not make the criminal complaint premature. Section 279(1A) operates only where penalty is reduced or waived under section 273A; it does not require postponement of prosecution until such possibility is exhausted. A criminal court may, in an appropriate case, regulate its own proceedings, but that does not render the complaint itself unsustainable or abusive.

Conclusion: The prosecution was not premature and did not amount to an abuse of process.

Final Conclusion: The criminal complaints were maintainable notwithstanding the pending reassessment proceedings, and refusal to quash them was justified.

Ratio Decidendi: Pendency of reassessment or penalty proceedings under the Income-tax Act does not, by itself, bar or invalidate prosecution for offences under sections 276C and 277; only an express statutory bar can do so, and the criminal court must decide the offence independently.

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