One audition, an unfinished band
The Beatles’ official history confirms that Decca granted the group an audition and then rejected it, after other companies had also declined to move forward. A label in early 1962 was judging a regional act, an audition tape, and a still-developing repertoire—not the recordings and cultural force that later listeners know.
The fact and the folklore
The recordings eventually reached George Martin at EMI’s Parlophone label by a different route. The rejection is well established, but the perfectly dismissive line often attached to it lacks equivalent support in the cited record, so the quote is not needed to make the decision consequential.