Natural justice in customs adjudication requires supply of relied-upon material before penalty can be sustained.

A penalty order under the Customs Act was set aside because the adjudicating authority relied on statements and other adverse material without supplying them to the noticee. In an abetment-based smuggling allegation, the affected person was entitled to copies of the evidence relied upon so that it could be corrected or contradicted. Non-furnishing of the statements, panchnama, and related material deprived the petitioner of an effective defence and violated section 124's requirement of notice, representation, and a reasonable opportunity of being heard. The adjudication was therefore invalid for breach of natural justice, though fresh proceedings were left open in accordance with law.

---

---

Issues: Whether the penalty order under the Customs Act was vitiated for denial of a reasonable opportunity of being heard by failure to furnish the statements and other material relied upon against the petitioner.

Analysis: The petitioner was proceeded against as an alleged abettor in a smuggling transaction and the adjudicating authority relied on statements of alleged co-participants, the panchnama, and other material to hold him liable. The petitioner repeatedly sought copies of the statements and the material proposed to be used against him, but those documents were not supplied before or during the adjudication. Since the accusation was essentially one of abetment by conspiracy, the petitioner was entitled to know the evidence relied upon against him so that he could correct or contradict it. Section 124 of the Customs Act, 1962 requires notice of the grounds, an opportunity to make a representation, and a reasonable opportunity of being heard. Suppression of the very statements used to establish guilt deprived the petitioner of an effective defence and offended the requirements of natural justice.

Conclusion: The adjudication was invalid for breach of natural justice and failure to comply with the statutory requirement of a reasonable opportunity of being heard.

Final Conclusion: The penalty order against the petitioner could not stand and was set aside, leaving the authorities free to initiate fresh proceedings in accordance with law.

Ratio Decidendi: Where an adjudicating authority relies on statements or other adverse material to establish liability, the affected person must be supplied that material and given a fair opportunity to meet it; otherwise the requirement of a reasonable opportunity of being heard is not satisfied.

---