Alternative remedy is not a bar for Writ Petition against Show Cause Notice; Rajasthan HC [Read Order]

PIL Rajasthan High Court

The division bench of the High Court of Rajasthan, has recently ruled that a writ petition filed againsta show cause notice issued under the provisions of Income Tax Act, 1961 is maintainable and such a petition is not barred on ground that alternative remedies are available to the assessee under the statute.

The assessee filed a Writ petition under Article 226, challenging the notice for re-assessment issued by the Income Tax Authorities under section 148 of the Income Tax Act. The Respondents contended that the said petition is not maintainable since alternative remedies are available to the assessee. In support of their argument, the Respondents cited the decision of the same Court in G.K.N. Drive shafts (India) Ltd v. Income-tax Officer & others 259 ITR 19 and Assistant Commissioner of Income-tax v. Banswara Syntex Ltd, claimed that Writ petition will not lie against a show-cause notice.

By rejecting the contention of the Respondents, the Court observed that “There can be no quarrel with the proposition that normally a writ petition will not lie against a show cause notice especiallywhen there be an alternative statutory remedy of appeal available. But there is no invariable rule that a writ petition will never lie against a show cause notice. If the show cause notice suffers from illegality apparent on the face of it a writ petitionwill be maintainable.”

The Court noticed that G.K.N. Driveshafts (India) Ltd v. Income-tax Officer & others, the single bench of the Supreme Court reversed the order of High Court and held that a writ petition cannot be barred only on the ground for availability of alternative remedy by way of first appeal and second appeal under the Act against any fresh orders passed in re-assessment.

Following the above decision of the Supreme Court, the division bench comprising of Justices Pankaj Bhandari and Navin Sinha, unanimously held that Writ Petition against a Show Cause Notice cannot be barred on the ground of availability of alternative remedy.

Read the full text of the order below.

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