Natural justice applies to coercive goods detention under compounded levy, even without an express show-cause notice.

Coercive detention of goods for recovery under the compounded levy scheme must comply with natural justice even where the statute does not expressly require a show-cause notice. Where the proposed action would divest an assessee of property, an opportunity of hearing is required before detention is sustained. The appellate order was confined to insisting on fair procedure before coercive action, and the record indicated that detention had effectively ceased. The assessee therefore succeeded, and the detention order could not stand without observance of natural justice.

---

---

Issues: Whether the order detaining goods for recovery of duty and penalty under the compounded levy regime could be sustained when passed without affording an opportunity of hearing, notwithstanding the absence of an express statutory requirement of show-cause notice.

Analysis: The detention order was made in relation to recovery of dues under the compounded levy scheme. Although the statutory provision invoked did not expressly require a show-cause notice, the goods had been sought to be detained in a manner that would divest the assessee of property. In such a situation, basic principles of natural justice could not be ignored. The impugned appellate order merely required observance of fair procedure before coercive action was taken. The record also showed that the detention had effectively ceased and no stay of the appellate order had been obtained.

Conclusion: The detention order could not be sustained in the absence of compliance with natural justice, and the assessee succeeded.

Ratio Decidendi: Even where a statute does not expressly provide for a show-cause notice, coercive action depriving a person of property must comply with the principles of natural justice.

---