The pilot, who held a flight instructor certificate, and the passenger, who held a private pilot certificate, took off and initially flew toward their southerly destination on an instrument flight plan. The passenger was employed by a television station which had hired the pilot to fly him to Southern California for a photo assignment. It was a clear day, and while en route the pilot cancelled his flight plan. Thereafter, all FAA services were terminated. The pilot had indicated that during the flight he planned to fly via Victor Airway 23. The airplane proceeded about 23 nm east of course and approached Mount Shasta, elevation 14,162 feet MSL. Witnesses, who were located at about the 6,700 foot level on the side of the mountain, observed the airplane flying within about 40 feet of the tops of trees and toward rising terrain. The airplane appeared to reverse its course and then descend into the 7600 to 7800 ft MSL terrain whereupon a fire immediately started. No mechanical malfunctions were found with the airplane.