Natural justice bars excise demand raised without prior show cause notice; proceedings were set aside as a nullity.

Central excise duty demand issued without a prior show cause notice was held unsustainable because the assessee was denied an opportunity to respond before the demand was raised. The absence of notice was treated as a breach of natural justice, so the proceedings could not be maintained. The demand was therefore set aside as a nullity, and consequential relief followed for the assessee.

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Issues: Whether the demand of central excise duty was sustainable when no show cause notice had been issued before raising the demand.

Analysis: The proceedings were initiated by a demand without prior notice to the assessee. The absence of a show cause notice meant that the assessee was denied an opportunity to respond before the demand was made. This was held to be a violation of the principles of natural justice, rendering the proceedings unsustainable.

Conclusion: The demand was set aside as a nullity for want of prior show cause notice, with consequential relief to the assessee.

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