2026 (3) TMI 262 - HC - Customs

Service of notices: returned postal articles defeat deemed service; alternative modes including email required before fresh hearing.

Service of notices under the Customs Act requires effective delivery; a deeming provision for postal service cannot be invoked where postal articles are ... Denial of hearing due to failure of service - principles of natural justice - deemed service under Section 153(3) subject to contrary proof - duty to effect alternative modes of service including electronic communication when postal service returns undelivered. Denial of hearing due to failure of service - deemed service under Section 153(3) subject to contrary proof - HELD THAT:- The Court examined the record which showed notices for the appellate hearing were issued by post but were returned with endorsements indicating non-delivery. The deeming provision for service in Section 153(3) operates only in the absence of proof to the contrary; where returned postal articles demonstrate non-service, the contrary is proved. If the appellate authority either noticed the returned articles and failed to take further steps to effect service by alternative modes, or proceeded on the erroneous view that service was satisfactorily effected without noticing the returned articles, the consequence is denial of opportunity of hearing. The customs authorities had the petitioner's e-mail address and the appellate authority ought to have resorted to other modes of communication available under the statute. The Court therefore found a breach of the principles of natural justice warranting interference with the impugned order. The Court expressly did not decide the merits of the underlying customs demand, leaving all substantive points open for fresh consideration by the appellate authority. [Paras 11, 13, 15, 16, 17] Impugned order set aside and matter remanded to the appellate authority to afford the petitioner a personal hearing and pass a fresh order; appellate authority to consider alternative modes of service including electronic communication and decide the matter expeditiously. Final Conclusion: The writ petition succeeds on the ground of breach of natural justice arising from failure to effect service of notices; the appellate order is set aside and the matter remanded for fresh hearing, with merits left open to the appellate authority. Issues: Whether the appellate order dated 17 March 2025, passed without affording the petitioner an opportunity of hearing because notices of hearing returned undelivered, was in violation of principles of natural justice and requires interference/remand.Analysis: Section 153 of the Customs Act, 1962 provides multiple modes for service of notices and contains a deeming provision that a notice sent by post is deemed served at the expiry of the normal transit period only if the contrary is not proved. Returned postal articles with endorsements indicating non-delivery constitute proof of contrary facts. Where returned notices are on file, reliance on deemed service is not permissible without attempting alternative modes of service provided under the statute. An appellate order made without ensuring effective service by available alternative methods, when postal service has failed, results in denial of the opportunity of hearing. Email service is an available and expected additional mode where an email address is on record and may be resorted to along with other prescribed modes.Conclusion: The appellate order dated 17 March 2025 is set aside for violation of principles of natural justice and the matter is remanded to the appellate authority for fresh consideration with direction to afford the petitioner an opportunity of personal hearing and to effect service by appropriate alternative modes expeditiously.