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Violation of principles of natural justice in the order of the Collector of Land Customs. Analysis: 1. The petitioner challenged the order of the Collector of Land Customs, contending that the principles of natural justice were violated. The Collector's order of confiscation and penalty imposition is subject to judicial review under Article 226 of the Constitution. The Collector acts in a quasi-judicial capacity when adjudicating such matters, as established by various Supreme Court decisions. 2. The Collector's reliance on witness statements without giving the petitioner an opportunity to cross-examine them constitutes a violation of natural justice. The Collector must act judicially, even though not bound by strict rules of evidence. The burden of proof lies with the customs authorities to establish the goods' illicit origin and the petitioner's involvement in smuggling, as per Supreme Court precedents. 3. The Department argued that natural justice principles vary case by case, but the duty to act judicially imposes certain fundamental principles on the Collector. Mere suspicion is insufficient for confiscation; there must be evidence to justify such action. Accepting witness statements without allowing cross-examination is a gross violation of natural justice. 4. The show cause notice issued to the petitioner indicated the right to produce evidence and cross-examine witnesses. The Collector's order primarily relied on witness statements, indicating a prejudiced decision-making process. The violation of natural justice is evident in the acceptance of unchallenged statements against the petitioner. 5. Legal principles from cases like Union of India v. T.R. Varma and Phulbari Tea Estate v. Its Workmen reinforce the importance of natural justice in quasi-judicial inquiries. The court can intervene under Article 226 if fundamental principles of natural justice are disregarded, as seen in this case where the Collector's actions were found to be unjust. 6. Another argument raised was the mixed nature of the goods, some of foreign origin and some Indian. The difficulty in separating illicit goods from legal ones further highlights the Collector's flawed decision-making process. As the inquiry was fundamentally flawed due to the violation of natural justice, the court quashed the Collector's order of confiscation and penalty imposition. This detailed analysis showcases the petitioner's successful challenge based on the violation of natural justice principles in the Collector's order, leading to the quashing of the decision by the High Court of Assam at Gauhati.
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