Natural justice requires cross-examination in customs adjudication before confiscation, penalty, or drawback denial can stand.

Denial of cross-examination of the Customs officer who examined and permitted export of the consignments was treated as a breach of natural justice, because that evidence was material to determine whether the goods had been examined and exported on the relevant date. The confiscation, penalty and rejection of drawback claims could not be sustained on the existing record, and the proper course was to set aside the adjudication and remand the matter for de novo consideration after granting cross-examination and hearing.

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Issues: Whether the order of confiscation, penalty and rejection of drawback claims could be sustained when the appellants were denied cross-examination of the Customs officer who examined and permitted export of the consignments, and whether the matter required remand for fresh adjudication.

Analysis: The order proceeded on the basis that the goods had not reached the Customs House CFS area by the relevant date and treated this as a violation of the Customs Act, 1962. The Tribunal found that, in similar matters, denial of cross-examination of the officer who examined the consignments had been held to offend the principles of natural justice. Since cross-examination was material to ascertain whether the goods had been examined and exported on the relevant date, the adjudication could not be sustained without giving that opportunity. The proper course was to set aside the order and direct fresh adjudication after affording cross-examination and hearing.

Conclusion: The appellants succeeded; the impugned order was set aside and the matter was remanded for de novo adjudication after granting cross-examination and hearing.

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