Natural justice applies to refusal of destruction claim for excisable goods unfit for marketing; hearing required before duty impact.

A refusal to permit destruction of excisable goods claimed to be unfit for marketing or consumption, where duty liability depended on the second proviso to Rule 49 of the Central Excise Rules, could not be treated as a mere administrative act. The authority had to consider the claim fairly, give the manufacturer an opportunity to establish the condition of the goods, and conduct a proper enquiry. Because no notice, hearing, or enquiry was afforded, the decision-making process was quasi-judicial in character and was vitiated by breach of natural justice. The matter therefore had to be reconsidered after hearing the appellant.

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Issues: Whether the Collector could reject the request for destruction of excisable goods claimed to be unfit for marketing or consumption without affording an opportunity of hearing and without conducting a proper enquiry.

Analysis: The request for destruction was made on the footing that the cigarettes were unfit for marketing or consumption, so that duty liability would not arise under the second proviso to Rule 49 of the Central Excise Rules. A refusal of such a claim directly affects the manufacturer's duty liability and, therefore, is not a mere administrative act. The authority was required to consider the claim fairly and allow the manufacturer an opportunity to establish the condition of the goods. The absence of notice, hearing, or enquiry amounted to a denial of natural justice. The decision-making process in such a case was held to be quasi-judicial in character.

Conclusion: The rejection was vitiated for breach of natural justice and the matter was required to be reconsidered after giving the appellant an opportunity of hearing.

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