Quashing of income-tax prosecution declined where cognizable offences were disclosed and defence pleas had to be tested at trial.

Complaint proceedings alleging offences under the Income-tax Act were not fit for quashing under Section 482 CrPC at the initial stage because the complaint disclosed cognizable offences under Sections 276C(1) and 277, treated as cognizable under Section 279A. The Court held that, while considering quashing, it cannot test the truthfulness of the allegations or evaluate the defence case; such disputed pleas must be left to trial. The petitioners' arguments that the allegations were false, premature, or did not disclose an offence were therefore treated as matters of defence, and the criminal proceedings were allowed to continue.

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Issues: Whether the complaint and criminal proceedings alleging offences under the Income-tax Act could be quashed in exercise of inherent powers under Section 482 of the Code of Criminal Procedure, 1973 at the initial stage.

Analysis: The petition sought quashing on the premise that the allegations were false, premature, and did not disclose any offence. The complaint specifically alleged offences under Sections 276C(1) and 277 of the Income-tax Act, 1961, and the Court noted that such offences are treated as cognizable under Section 279A of the same Act. Applying the settled principle governing quashing jurisdiction, the Court held that at the stage of considering quashing, it cannot embark upon an enquiry into the reliability or genuineness of the allegations, nor can it assess the defence that the petitioners may raise before the trial court. The grounds urged were found to be matters of defence to be tested in the criminal proceedings.

Conclusion: The complaint and the proceedings were not liable to be quashed under Section 482 of the Code of Criminal Procedure, 1973.

Ratio Decidendi: Inherent jurisdiction to quash criminal proceedings should not be exercised where the complaint discloses cognizable offences and the challenge is founded on disputed defence pleas, as such matters must ordinarily be left for trial.

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