Writ jurisdiction survives an ineffective alternate remedy where tax action is mala fide; a reasoned remand with safeguards is sustainable.

An alternate statutory remedy does not bar writ jurisdiction where the impugned tax action is mala fide and the appellate remedy would be ineffective or an empty formality. The text also states that a remand with directions can be sustained where the assessing authority's additions are found unsupported, the ownership of fixed deposits is attributed to a third party, and proposed reassessment is unjustified. In such circumstances, the assessing authority may be directed to proceed strictly in accordance with law and within guidelines intended to prevent unjustified additions while protecting revenue interests.

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Issues: (i) Whether the writ court was justified in entertaining the challenge despite the availability of an appellate remedy under the Income-tax Act, 1961. (ii) Whether the order remanding the matter to the assessing authority with guidelines, after holding that the additions and proposed reassessment were unjustified, called for interference in appeal.

Issue (i): Whether the writ court was justified in entertaining the challenge despite the availability of an appellate remedy under the Income-tax Act, 1961.

Analysis: The impugned assessment proceedings were found to be tainted by mala fides and were pursued in a manner inconsistent with fairness. In such circumstances, the statutory appeal was treated as an ineffective and empty formality. The availability of an alternate remedy did not operate as a bar to exercise of writ jurisdiction where the impugned action was alleged and found to be mala fide and the remedy was not efficacious.

Conclusion: The writ court was justified in entertaining the petition notwithstanding the alternate remedy.

Issue (ii): Whether the order remanding the matter to the assessing authority with guidelines, after holding that the additions and proposed reassessment were unjustified, called for interference in appeal.

Analysis: The remand order was supported by detailed findings that the impugned additions lacked justification, that the three fixed deposit receipts belonged to Jayanti Lal Patel, and that several proposed additions could not be sustained on the material before the authority. The remand was accompanied by guidelines intended to ensure that the assessing authority acted in accordance with law and protected the Department's interest while preventing unjustified additions.

Conclusion: The remand order was proper and did not warrant interference.

Final Conclusion: The appellate court affirmed the writ court's exercise of jurisdiction and upheld the remand with directions, leaving the assessing authority to proceed strictly in accordance with the stated guidelines.

Ratio Decidendi: The existence of an appellate remedy does not bar writ jurisdiction where the impugned tax action is mala fide and the alternative remedy is not efficacious; a well-reasoned remand framed to prevent unjustified additions is sustainable.

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