Natural justice in customs inquiries requires cross-examination and disclosure of relied-upon material before adverse action stands.

Availability of an appellate remedy does not by itself bar a writ petition where the challenge is founded on breach of natural justice, and Article 226 relief may still be available. In a customs disciplinary inquiry, the inquiry process must comply with the prescribed procedure, including notice, consideration of evidence, cross-examination of relied-upon witnesses, and supply of material used against the affected person. Where statements are relied upon without producing the witnesses or furnishing copies, the adverse findings and revocation action are unsustainable. If only the final revocation order is invalidated and the underlying proceedings survive, the related suspension may continue while the inquiry is reopened from the appropriate stage.

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Issues: (i) Whether the writ petition was barred on the ground of availability of an alternative appellate remedy despite the allegation of breach of natural justice; (ii) Whether the enquiry report and revocation order were vitiated for denial of cross-examination and non-supply of material relied upon; (iii) Whether the earlier suspension order continued to operate after the impugned revocation order was set aside.

Issue (i): Whether the writ petition was barred on the ground of availability of an alternative appellate remedy despite the allegation of breach of natural justice.

Analysis: The existence of an appellate remedy does not, by itself, bar recourse to writ jurisdiction. Where the challenge is founded on violation of principles of natural justice, relief under Article 226 is ordinarily available. The availability of appeal under the Customs Act, 1962 was therefore not treated as a bar.

Conclusion: The preliminary objection was rejected.

Issue (ii): Whether the enquiry report and revocation order were vitiated for denial of cross-examination and non-supply of material relied upon.

Analysis: The procedure under Regulation 23 of the Customs House Agents Licensing Regulations, 1984 requires notice, inquiry, consideration of evidence, cross-examination of witnesses relied upon, and a fair opportunity before adverse action is taken. The record showed reliance on statements of persons who were neither produced for cross-examination nor supplied to the petitioner, although those statements formed the basis of the adverse findings. The Collector also relied on such material without furnishing copies to the petitioner. This offended the statutory procedure and the requirements of natural justice.

Conclusion: The enquiry report and the revocation order were unsustainable and were quashed.

Issue (iii): Whether the earlier suspension order continued to operate after the impugned revocation order was set aside.

Analysis: The cases cited on lapse of suspension after dismissal were distinguished because the impugned revocation order here was held to be a nullity for breach of natural justice, not an effective final order. The petitioner had not sought quashing of the underlying show cause proceedings, so the suspension based on pending proceedings was not extinguished. In that situation the suspension could continue while the inquiry was reopened from the appropriate stage.

Conclusion: The suspension order was held to continue to operate.

Final Conclusion: The adverse enquiry findings and revocation were set aside for breach of fair procedure, but the disciplinary process was permitted to resume from the inquiry stage and the suspension was allowed to remain in force for the limited period directed.

Ratio Decidendi: Where a statutory disciplinary or regulatory inquiry requires cross-examination and supply of relied-upon material, adverse action taken in breach of that procedure is a nullity, yet an underlying suspension based on pending proceedings may continue if the final order alone is invalidated and the proceedings themselves survive.

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