Order passed without giving hearing is against the principles of natural justice.

PJ/Case law/2014-15/2283

Case:- BALAJI IMPEX V/S UNION OF INDIA

Citation:- 2012 (279) E.L.T. 485 (Bom.)

Brief facts:-The petitioners are aggrieved by the communication issued to them by the assistant commissioner, custom (preventive), Alibag Division (exhibit G) by which they have been informed hat the Deputy commissioner of Custom, who was nominated by the commissioner of custom for finalization of the provisional assessments of certain bills of entry, under a special drive had finalized the assessments and passed orders accordingly. The communication contains an annexure setting out the provisional assessments which have now been finalized, and calls upon the petitioners to pay the duty alleged to have been short paid.

Appellant’s contentions:-The grievance of the petitioners is that- (i) No hearing was afforded to them by the deputy commissioner of customs; (ii) No speaking order has been passed and (iii) Even the elementary principles of natural justice have therefore not been complied with.

Respondent’s contentions:- Counsel appearing on behalf of the respondents urged that the petitioners should be relegated to the remedy of filing an appeal against the order passed by the deputy commissioner finalizing the assessments.

Reasoning of judgment:- During the course of the hearing, it has been stated before the court by counsel appearing on behalf of the respondents that the petitioner were not afforded an opportunity of being heard by the authority which passed the order. That being an admitted position on which there is no dispute, we are of the view that a fit and proper case for the exercise of the writ jurisdiction has been made out and there is no reason to relegate the petitioners to the remedy of an appeal. There is manifestly a failure of compliance of the principles of natural justice.

In Automotive Tyre Manufactures Asson. v/s DesignatedAuthority [2011(236) E.L.T. 481(S.C.)] the supreme court held that if one person hears and another decides, a personal hearing would become an empty formality. An order passed by a quasi judicial authority without complying with the principles of natural justice would therefore be invalid. The same principle would govern the present case. Merely because there was a special drive to clear a backlog of matters, that would afford no justification for the department not to comply with fundamental principles of natural justice. Efficiency in the disposal of quasi judicial proceedings is important but, that cannot be at the cost of overriding fundamental principles known to the law of the land.

They are, therefore, of the view that the impugned communication at Exhibit G and the consequent assessment orders, have to be set aside and a direction would have to be issued to the Deputy Commissioner of Customs to fresh order finalizing the assessment after furnishing to the petitioners an opportunity of being heard. There shall accordingly be an order and direction in these terms. The petitioners shall appear before the concerned Deputy/Assistant Commissioner of Customs entrusted with the hearing of the case on 11 July 2011 together with an authenticated copy of this order. The adjudicating authority shall take necessary steps in accordance with law to finalize the assessment after furnishing to the petitioners an opportunity of being heard and complying with the principles of natural justice, on an expeditious basis.

Decision:- The petition is allowed.

Comment:- The crux of the case is that the adjudicating authority is duty bound to comply with the fundamental principles of natural justice. As no hearing was afforded to the assessee and a non-speaking order was passed, the petition was allowed by way of remand to decide afresh after affording opportunity of hearing to the assessee.

{Prepared by: Monika Tak}

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PJ/Case law/2014-15/2283

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