1984 (12) TMI 314 - HC - Customs

Summary

Issues Involved:
1. Validity of the cancellation of the import licence.
2. Violation of principles of natural justice.
3. Validity of the subsequent confiscation order and imposition of redemption fine.

Issue-wise Detailed Analysis:

1. Validity of the cancellation of the import licence:
The appellant's import licence was initially valid until 30-06-1970. The appellant applied for revalidation, which was granted from 12-11-1970 to 31-12-1970. However, the fourth respondent later cancelled the licence on 15-12-1970 without notice or hearing, citing that the entire quantity referred to in the licence had already been imported. The High Court found that this cancellation violated Clause 10 of the Imports (Control) Order, 1955, which mandates a show cause notice and a reasonable opportunity of being heard before cancelling a licence. Therefore, the cancellation order dated 15-12-1970 was deemed void.

2. Violation of principles of natural justice:
The appellant argued that the cancellation of the licence without notice or hearing violated the principles of natural justice. The High Court agreed, emphasizing that "a man cannot be condemned unheard." The court noted that the revalidated licence conferred a benefit on the appellant, and depriving this benefit without notice or hearing was a clear violation of natural justice. The court cited the Supreme Court's decision in Nawabkhan Abbaskhan v. State of Gujarat, which supports the principle that an order violating natural justice can be collaterally attacked in subsequent proceedings.

3. Validity of the subsequent confiscation order and imposition of redemption fine:
The confiscation order dated 19-08-1971 and the imposition of a redemption fine were based on the cancellation of the licence. The High Court held that since the cancellation order was void, all subsequent orders, including the confiscation order and the imposition of the redemption fine, lacked a valid basis. The court quashed the orders of the third respondent dated 19-08-1971, the second respondent dated 08-09-1972, and the first respondent dated 13-12-1973. The court also noted that the appellant could make a collateral attack on the cancellation order in these proceedings.

Conclusion:
The High Court allowed the writ appeal, quashing all orders originating from the void cancellation of the licence. The fourth respondent was given the liberty to issue a fresh show cause notice and pass final orders after hearing the appellant's objections. Any further proceedings by the third respondent would depend on the final orders regarding the licence cancellation. The writ appeal was allowed with no order as to costs.