Natural justice in excise assessment: demand quashed where the Chemical Examiner's report was not supplied to the assessee.

Excise duty demand founded on a Chemical Examiner's report was quashed because the report had not been supplied to the assessee, so the levy was made in breach of natural justice. The merits were left open, and the respondents were permitted to proceed afresh on the later show cause notice in accordance with law. The court also directed refund if the fresh proceeding was not concluded within the stipulated time.

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Issues: Whether the demand and appellate order levying excise duty were liable to be quashed for breach of natural justice, and what consequential relief should follow.

Analysis: The demand had been founded on the Chemical Examiner's report without supplying a copy of that report to the petitioner. The basis of the levy was thus reached without observance of natural justice. The Court also left the merits of the controversy open and permitted the respondents to proceed afresh on the later show cause notice in accordance with law.

Conclusion: The demand dated 24 November 1964 and the appellate order dated 14 March 1966 were quashed. The respondents were given liberty to proceed again on the show cause notice dated 4 May 1966, and refund was directed if the fresh proceeding was not concluded within the stipulated time.

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