Wilful tax-payment evasion requires conscious intent, so delayed payment without mens rea cannot sustain criminal prosecution.

Wilful attempt to evade payment of tax under Section 276C(2) requires a deliberate, intentional and conscious act; mere delay or failure to pay tax, penalty or interest without mens rea does not meet the penal threshold. The notes state that declared income, requests for time due to business closure, periodic payments with interest, and full payment before material progress in complaint proceedings did not disclose a specific wilful act of evasion. They further state that the process-issuing order did not properly scrutinise whether the offence was prima facie established. On that analysis, the complaint and criminal process were unsustainable.

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Issues: Whether the complaint and process for prosecution for wilful attempt to evade payment of tax under Section 276C(2) were sustainable.

Analysis: Section 276C(2) requires a deliberate, intentional and conscious attempt to evade tax, penalty or interest; mere delay or failure to pay, without mens rea, does not satisfy the penal provision. The assessee had declared its income, repeatedly sought time owing to business closure, made periodic payments with interest, and discharged the entire liability before the complaint proceedings materially progressed. The complaint did not identify any specific wilful act or circumstance demonstrating an attempt to evade payment. The order issuing process also failed to account for these material facts and reflected no proper scrutiny of whether the offence was prima facie made out.

Conclusion: The essential ingredients of a wilful attempt to evade tax were not disclosed; the criminal complaint and the process issued against the petitioners were unsustainable.

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