Natural justice limits administrative debarment where serious civil consequences follow and required findings are not recorded.

Administrative debarment under Clause 6 of the Imports (Control) Order, 1955 could not be imposed on the petitioner companies without notice or hearing, because the measure carried serious civil consequences and natural justice was not clearly excluded by statute. The authority was also required to make the jurisdictional findings demanded by its own guidelines, including whether the associated company had substantially benefited from the offence and whether a director had controlling interest. As no hearing was given and no such findings were recorded, the action reflected violation of natural justice and non-application of mind, and the debarment was quashed to that extent.

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Issues: Whether the application of Clause 6 of the Imports (Control) Order, 1955 to the petitioner companies, without notice or hearing, was valid in law.

Analysis: The debarment under Clause 6 had serious civil consequences and could not be sustained unless the affected party was given an opportunity of hearing, at least before or after the decision, where the statute did not expressly and unmistakably exclude the audi alteram partem rule. The departmental guidelines for Clause 6 also required examination of whether the associated company had substantially benefited from the offence and whether a director had controlling interest in the affairs of the company. No notice or hearing was given to the petitioner companies, no finding was recorded that they had benefited from the offence, and the necessary finding of controlling interest was also absent. The material, therefore, showed violation of natural justice and non-application of mind.

Conclusion: The application of Clause 6 to the petitioner companies was invalid and the debarment order to that extent was quashed in favour of the petitioners.

Ratio Decidendi: Where an administrative debarment order under a statute or subordinate legislation entails serious civil consequences, it cannot be applied to an affected party without observance of natural justice unless exclusion of hearing is clear by necessary implication, and the authority must record the relevant jurisdictional findings required by its own governing guidelines.

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