The mentioned issue might occur due to the following :
For Example : If you are initialising in this location : C/windows/system32/catalyst/aliencity , the previous folders namely Catalyst or system32 or windows folder might have a Catalyst project initialised. To resolve this issue, kindly delete all the catalyst related files including a hidden file named .catalystrc and then try catalyst init. Kindly do check on the same and get back to us if you further face any issues. You can find the help documentation for the same here.