Natural justice in penalty proceedings requires a fresh hearing when the statutory basis is changed mid-adjudication.

Where the statutory basis of a penalty proceeding is materially altered by a corrigendum, the authority must give the affected party a fresh and effective opportunity to respond, including time to file a reply and a personal hearing. Because the final order was passed before such opportunity was afforded, the adjudication was vitiated for breach of natural justice. The penalty order was set aside and the matter remitted for fresh adjudication, with the merits of the underlying controversy left open for determination by the authority.

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Issues: Whether the impugned penalty order was liable to be quashed for breach of natural justice arising from issuance of a corrigendum changing the statutory basis of the proceedings without giving the petitioner adequate time to respond and a fresh personal hearing.

Analysis: The show cause notice was materially altered by the corrigendum, including a shift in the provisions proposed to be invoked. The petitioner was entitled to a meaningful opportunity to meet the changed case, which required time to file a reply after receipt of the corrigendum and a personal hearing thereafter. Since the final order was passed before such opportunity was afforded, the adjudication stood vitiated. The merits of the controversy, including the nature of the product and commencement of production, were left open for fresh determination by the authority.

Conclusion: The impugned order was set aside for violation of natural justice and the matter was remitted to the respondent for fresh adjudication after granting the petitioner an opportunity to reply and be heard.

Ratio Decidendi: When the statutory basis or case against a party is materially altered during adjudication, the authority must afford a fresh and effective opportunity to respond and be heard before passing final orders.

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