Natural justice in penalty proceedings requires a real opportunity to participate and cross-examine before adverse action is sustained.

Denial of a reasonable opportunity to participate and cross-examine witnesses vitiated the penalty proceedings, because the petitioner was in detention and had sought deferment through counsel to enable an effective defence. The High Court held that refusal to adjourn and proceeding without meaningful participation offended natural justice in relation to the penalty order, which was set aside for fresh continuation after adequate opportunity was granted. The confiscation order was not interfered with.

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Issues: Whether the order of confiscation and penalty was liable to be interfered with for denial of a reasonable opportunity to participate in the proceedings and cross-examine witnesses.

Analysis: The petitioner was under detention during the relevant period and had sought deferment of the proceedings through counsel so that he could effectively participate and instruct his advocate. The proceedings involved examination of witnesses and cross-examination, making a personal or properly instructed defence material to a fair hearing. In these circumstances, refusal to adjourn and proceed in the absence of effective participation offended the requirements of natural justice, at least so far as the penalty proceedings were concerned.

Conclusion: The penalty order was set aside and the matter was directed to be continued after granting adequate opportunity to the petitioner to participate. The confiscation was not interfered with.

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