Final resolution of underlying VAT liability required quashing forgery proceedings against a similarly placed co-accused.

Criminal proceedings for alleged forgery and use of forged documents were considered unsustainable where the sole underlying allegation was non-payment of VAT and the reassessment imposing tax, interest and penalty had been set aside in appeal. The resulting resolution of VAT liability had attained finality. Since proceedings against a similarly placed co-accused had already been quashed on the same basis, equivalent treatment was applied, and the criminal proceedings against the petitioner were quashed.

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Issues: Whether criminal proceedings for alleged forgery and use of forged documents could continue against a co-accused when identical proceedings against a similarly placed co-accused had been quashed after the underlying VAT liability was conclusively resolved.

Analysis: The only allegation concerned non-payment of VAT. The reassessment creating tax, interest and penalty liability had been set aside in appeal, and the consequent tax liability had attained finality. A coordinate bench had already quashed the proceedings against a similarly placed co-accused on that basis. The petitioner was entitled to equivalent treatment.

Conclusion: The criminal proceedings against the petitioner could not continue and were quashed.

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