1984 (11) TMI 68 - HC - Customs

Summary

Issues:
1. Validity of the cancellation of import licences by the Deputy Chief Controller of Imports and Exports without serving notice or hearing the license holders.
2. Interpretation of the provisions regarding letters of authority and their implications on the rights of the letter of authority holders.
3. Adherence to the principles of natural justice in quasi-judicial proceedings.

Detailed Analysis:

1. The judgment revolves around the cancellation of import licences by the Deputy Chief Controller without providing a reasonable opportunity of being heard to the license holders. The petitioners filed a Writ Petition seeking to quash the seizure memos and halt further proceedings. The cancellation was based on allegations of forgery without serving any show cause notice or hearing the petitioners. The Court found the cancellation orders unsatisfactory as they were passed without following the principles of natural justice, specifically the right to be heard. The Court emphasized that orders passed without hearing the affected parties are in violation of natural justice and cannot be upheld.

2. The judgment delves into the interpretation of letters of authority under the Imports and Exports (Control) Act and the Hand Book of Import-Export Procedures. The letter of authority authorizes the licensee to permit another person to import goods against the license. The Court highlighted that the letter of authority holder, although an agent of the licensee, could face adverse consequences if the license is canceled. The Court noted that the letter of authority holder's rights were directly impacted by the cancellation of the license, emphasizing the need to consider the implications on the letter of authority holders before such decisions are made.

3. The judgment underscores the importance of adhering to the principles of natural justice in quasi-judicial proceedings. It criticized the Deputy Chief Controller for basing the cancellation on assumptions without proper examination or allowing cross-examination of relevant parties. The Court emphasized the need for a fair and transparent process, including issuing show cause notices, hearing all concerned parties, and conducting a thorough inquiry before making decisions that could have significant civil consequences. The Court quashed the cancellation orders and directed the Chief Controller to issue fresh show cause notices, ensuring a fair hearing for all parties involved.