Mandatory pre-show cause consultation binds the department; notice issued without it was quashed.

A departmental circular requiring mandatory pre-show cause consultation binds the department, and a show cause notice issued in breach of that procedure is arbitrary and liable to be set aside. The High Court held that the notice could not stand because the prescribed consultation was not followed, even though the requirement arose from a circular rather than a statute. The impugned notice was quashed, while the department was left free to restart proceedings from the stage of pre-show cause consultation in accordance with law.

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Issues: Whether the show cause notice issued without the mandatory pre-show cause notice consultation required by the departmental master circular was liable to be set aside.

Analysis: The circular made pre-show cause consultation mandatory in cases involving demands above the specified threshold. A departmental circular is binding on departmental and cannot be disregarded on the footing that it is not a statutory requirement. Since the notice was issued without following that mandatory consultation procedure, the issuance of the notice was arbitrary and contrary to the circular.

Conclusion: The show cause notice was quashed. The respondents were permitted to initiate fresh proceedings from the stage of pre-show cause consultation, with the clarification on limitation as stated in the order.

Final Conclusion: The writ petition succeeded, and the impugned show cause notice stood invalidated for non-compliance with the mandatory consultation requirement, while preserving the department's right to proceed afresh in accordance with law.

Ratio Decidendi: A departmental circular prescribing mandatory pre-show cause consultation binds the department, and a show cause notice issued in breach of that requirement is liable to be set aside.

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