Madras HC Directs Auction of Luxury Car, Rejects Writ Remedy

A bench of Chief Justice Sushrut Arvind Dharmadhikari and Justice G. Arul Murugan heard an appeal by Dr. Arvind Kumar R Shaw challenging a Single Judge's dismissal of his writ petition which sought to set aside an assessment order passed under Section 143(3) read with Section 153C of the Income-tax Act and the Commissioner (Appeals)'s order. The appeal arose from income‑tax proceedings following seizure of a Rolls Royce owned by the appellant and assessed by the Income Tax Department.

The Court dismissed the writ appeal, holding that the High Court need not entertain a petition where "very serious disputed questions of fact" required evidence and where an efficacious statutory remedy existed under the Income‑tax Act. The bench observed that the exercise of writ jurisdiction should not displace the "complete machinery to challenge an order of assessment" provided by statute and relied on precedents including CCT v. Glaxo Smith Kline Consumer Health Care Ltd. 

The Court, in its reasoning, observed: “We may usefully refer to the exposition of this Court in Titaghur Paper Mills Co. Ltd. v. State of Orissa, wherein it is observed that where a right or liability is created by a statute, which gives a special remedy for enforcing it, the remedy provided by that statute must only be availed of. … ‘Under the scheme of the Act, there is a hierarchy of authorities before which the petitioners can get adequate redress against the wrongful acts complained of. The petitioners have the right to prefer an appeal before the Prescribed Authority … The Act provides for a complete machinery to challenge an order of assessment, and the impugned orders of assessment can only be challenged by the mode prescribed by the Act and not by a petition under Article 226 of the Constitution. It is now well recognised that where a right or liability is created by a statute which gives a special remedy for enforcing it, the remedy provided by that statute only must be availed of.’” The bench affirmed the Single Judge’s conclusion that disputed factual issues, including whether payment for the car was made, could not be resolved in writ proceedings and therefore warranted dismissal.

Background

The dispute arose after the appellant purchased a Rolls Royce Phantom for Rs.1,45,00,000 and, purportedly for sale, handed the vehicle and original documents to one Karthikeyan, who represented interest from a buyer in Kochi. The appellant alleged no payment was made and lodged a police complaint in November 2017. The Income‑tax Department seized the car at a service centre in Kochi and issued a notice under Section 153C on 25.11.2021, culminating in an assessment order dated 29.12.2021 under Section 143(3) read with Section 153C. The Commissioner of Income Tax (Appeals) rejected the appellant’s challenge by order dated 07.03.2024. The appellant’s writ petition before the Single Judge was dismissed on 27.01.2026.

The Single Judge had recorded that “there is no case to interfere with the impugned orders” and noted that “there are several disputed questions of facts which cannot [be] dissected and decided in this writ petition.” The Single Judge directed that “the department is directed to auction the same and deposit the amount in an escrow account, which is to be appropriated or released to the petitioner subject to the final outcome of the proposed appeal to be filed by the petitioner before the Appellate Tribunal,” and granted liberty to file the statutory appeal within 30 days. The High Court bench found no reason to interfere with those conclusions, emphasising the availability of the statutory appellate forum and the factual nature of the controversy. The writ appeal was dismissed with no order as to costs; interim applications stood closed.

Case Details:
Case No.: W.A.No.773 of 2026
NeutralCitation: 2026:MHC:1181
Case Title: Dr. Arvind Kumar R Shaw v. Union of India & Ors.
Appearances:
For the Petitioner(s): Mr. Ravikumar Paul, Senior Counsel, for Ms. Joshua Samuel, for M/s. Paul And Paul
For the Respondent(s): Mr. A.N.R. Jayaprathap, Standing Counsel for Income Tax Department

Source: 2026 CaseBase(MAD) 145