Natural justice in excise classification: ex parte modification without notice or hearing was invalid, with remand for fresh decision.

Modification of a classification list proposed under Rule 173B(4) of the Central Excise Rules could not be made ex parte when the Assistant Collector intended to alter the fresh classification filed on a change in duty rate. The assessee had to be given notice and an opportunity of personal hearing before any such modification, failing which the action amounted to denial of natural justice. The impugned modification was therefore invalid, the order was set aside, and the matter was remanded for a de novo decision after notice and hearing to the assessee.

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Issues: Whether the modification of the classification list without issuing a show cause notice or granting a personal hearing was valid, and whether the matter required remand for fresh decision.

Analysis: Rule 173B(4) of the Central Excise Rules permitted the filing of a fresh classification list on change in duty rate. If the Assistant Collector intended to modify the classification proposed in the fresh list, the assessee was required to be given notice and an opportunity of personal hearing. The modification was made ex parte and without affording such opportunity, which amounted to denial of natural justice.

Conclusion: The modification of the classification list without notice and hearing was invalid. The impugned order was set aside and the matter was remanded for a de novo decision after giving notice and personal hearing to the assessee.

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