Natural justice in customs adjudication requires supply of relied-upon documents and a proper hearing before adverse action.

Non-supply of relied-upon documents and denial of an effective hearing vitiated the customs adjudication. The Calcutta HC held that natural justice is not satisfied merely by offering inspection when the assessee has reasonably sought copies of documents relied upon in the show-cause notice, except for classified or secret material. It also reaffirmed that an adverse order cannot be sustained without giving the assessee a proper opportunity of hearing. The assessment, confiscation, demand and penalty order was set aside, and the matter was remitted for fresh adjudication after furnishing the requisite copies or, where copies could not be supplied, disclosing reasons and permitting inspection.

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Issues: Whether the customs adjudication order was vitiated for breach of natural justice on account of non-supply of relied-upon documents and denial of hearing.

Analysis: The assessee challenged the order of valuation, confiscation, demand, penalty and final assessment on the ground that the adjudicating authority passed the order without giving an effective opportunity of hearing and without furnishing copies of the documents relied upon in the show cause notice. The record indicated that inspection was offered, but the assessee sought copies of the documents instead. The Court held that the requirements of natural justice are not satisfied merely by offering inspection where copies of relied-upon documents are reasonably sought, save for classified or secret material, and that the assessee was also entitled to a hearing before adverse adjudication. Since the impugned order was passed without such opportunity, it could not be sustained.

Conclusion: The impugned assessment order was set aside and quashed, and the matter was remitted to the adjudicating authority for fresh decision after granting hearing and furnishing the requisite copies of documents or, where copies could not be supplied, disclosing reasons and permitting inspection.

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