Natural justice and direct evidence requirements bar customs liability without a fair chance to rebut allegations.

Liability could not be imposed on the appellant where there was no direct evidence of involvement and no fair opportunity to answer the allegations based on third-party statements. The record showed that he was not examined under Section 108 of the Customs Act, 1962, and was not given an effective chance to rebut the case against him. The principle against condemning a person unheard required observance of natural justice before penal consequences were fastened. The impugned order was therefore unsustainable and was set aside, with the appeal allowed.

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Issues: Whether the appellant could be fastened with liability in the absence of direct evidence and without an opportunity to meet the allegations, including examination under Section 108 of the Customs Act, 1962.

Analysis: The record did not show that the appellant was examined under Section 108 or otherwise given a fair opportunity to defend himself against the allegations based on third-party statements. The order proceeded against him without direct evidence of his involvement in financing the illegal import and without any effective chance of rebuttal. The principle that no person should be condemned unheard required observance of fair hearing before penal consequences could follow.

Conclusion: The impugned order could not be sustained and was set aside. The appeal was allowed.

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