Natural justice in classification disputes requires prior notice of the issue before an appellate order can be sustained.

An appellate order cannot be sustained where it rests on a classification ground never put to notice to the assessee, because deciding on an uncontroverted issue violates basic fairness and vitiates the order. The original authority's order was also noted to be non-speaking, but the matter was not examined on merits because the defective appellate decision was set aside. The case was remanded to the Assistant Commissioner of Customs for a de novo decision after giving the assessee an opportunity of being heard.

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Issues: Whether the appellate order could be sustained when it proceeded on a classification ground not put to notice before the parties, and whether the matter should be remanded for fresh decision.

Analysis: The appellate authority adopted a ground entirely different from the one in dispute before the original proceedings. The assessee had not been put on notice of that ground, and the authority could not base its decision on an issue that had never been contested. The order was therefore vitiated by a basic infirmity. The order of the original authority was also noticed to be non-speaking, but the matter was not examined on merits in view of the remand.

Conclusion: The impugned order was set aside and the matter was remanded to the Assistant Commissioner of Customs for de novo decision after giving the assessee an opportunity of being heard.

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