Principle Natural Justice: The principle of Natural Justice is implemented to make sure that there exists a balance between the social and economic activities of the people and shields individual liberty against arbitrary action. Now, the question is what exactly are these principles are?
In this article, we are going to discuss the principle of natural justice and the principle for issuing show-cause notice.
- Principle of Natural Justice
- Nemo Judex in Causa Sua
- Audi Alteram Partem
- Principle for Issuing Show Cause Notice
- Whether it is Mandatory to Issue Show Cause Notice?
- Whether Unsigned Show Cause Notice Is Valid?
- When Can The Notice Be Issued?
The principle of Natural Justice is not provided in the Indian Constitution but it is one of the most crucial elements for the administration of justice. The meaning of Natural Justice is the law of nature(jus natural). Or in layman language, we can also be called natural justice as a “natural sense of what is right or wrong.” Here, ‘Natural’ does not indicate that the principle will be found in nature, it is an abridgment of concepts that are naturally associated with justice.
Even this is not in the incorporated law, justice is a great force for progress. Its priority is the rule of law rather than the rules of natural prevail in regulating the human body. The principle of Natural Justice has a very wide range of applications towards the responsibility of the administration. The main target of this principle of Natural Justice is to prevent arbitrariness and injustice towards the citizens. This principle is defined as cramping to final judicial proceedings only but with the arrival of the welfare state the power of administration authorities increases which results in the impossible to determine a fair judgment based on the law which was being followed by each authority while adjudicating any disputes or any quasi-judicial proceeding.
It consists of two primary rules. These rules are:-
- Nemo Judex in Causa Sua (rule against bias)
- Audi Alteram Partem(rule of hearing)
This rule stands against bias. It is considered the first principle of Natural Justice. It says, no man shall be judge in his cause or a deciding authority must be neutral and impartial while taking the decision of any case. Thus, when the authority is suspected to be bias and partial then according to the principle of Natural Justice, the authority shall be disqualified for determining any case before them. This shows us that justice is not only done but also has to be seen to be done.
This rule allows us to hear the other side of the situation/condition as well. And this is the fundamental rule of natural justice to listen to the other side of the scenario so that, no one should be condemned unheard. In a situation where the person (against whom the action is sought to be taken) needs to put his/her side, he/she is allowed the equal opportunity of being heard.
As per Hon’ble Supreme Court in CCE & Land Custom v Sanawarmal Purohit 1979 (4) ELT j 613 (SC), if quasi-judicial authority is not allowed to hold an inquiry into a dispute before him according to the procedure followed inside the courtroom. But the tribunal has the power to inquire as to if he thinks it fit. It decided a case on the matter of fact discovered by the tribunal itself on inspecting the premises in question. The tribunal has to inform the parties about the inspection done by them otherwise it will be considered as a breach of natural justice. As they did not allow the chance so that they can deal with their sides.
If there is any interference from the third party then the tribunal has to present the related document to both parties to provide equal opportunities of commenting on it in the session. It was the duty of the customs collector to inform the persons accused before him of the charges against them. A quasi-judicial authority will act in violation of the rules of natural justice if it acts on the information it has collected and has not been disclosed to the interested party and as to the full opportunity to fulfill the conclusions arising from it is not given.
Concerning the principles of natural justice, the Supreme Court of Tyre industry Asson. V The Designated Body 2011 (263) ELT 481 (SC) decided that the rules of “natural justice” are not embodied rules. The basic principle of natural justice, which arose under common law, is the verification of the arbitrary exercise of power by the state or its officials. Therefore, the principle means the duty to act fairly, i.e. fair play at work. In this case, the material collected by the previously designated anti-dumping authority was used by the successor without the affected parties being heard. So the matter itself was interfered with as a violation of the principles of natural justice.
The indirect tax legislation in Section 11A of the Central Excise Act, 1944, Section 73 of the Finance Act, 1994, and Section 28 of the Customs Act, 1962 is mandatory to issue a show-cause notice before adjudicating a matter. Therefore, it might be relevant to mention a few principles in that interest.
In UOI Vs. Madhumilan Syntex Ltd. 1988 (35) ELT 349, the high court ruled that any application made without notice of cause or service may not be valid in terms of Section 11A of the Central Excise Act, 1944. In CCE Vs. I-Kosan Metal Products Ltd. 1988 (38) ELT 573, the Supreme Court held that a causal notice is required before a judgment and simply commenting on the restitution is not a notice.
In the case of Harichand K. Khanna Vs. C.C.E. In 2002 (150) ELT 1323 (Tri-LB) it was concluded that the exhibition notice would not be valid if the copy provided was not signed by the Commissioner but certified by Asst. Commission, provided that a copy of the office is submitted to the Commission. It should be noted that legislation in this regard should be strictly enforced. It is evident from many things that notices and instructions are written by the Commissioner’s subordinates by attaching his signature.
According to the provisions of the law, to indicate where notices may be issued where tax/levy is taxed, unpaid or underpaid or partially paid or returned in error.
- Short levy– Tax/ duty has been levied.
- Non-levy– It arises when the same has not at all been charged on the product or service.
- Short-paid– An amount less than what is due.
- Erroneous refund– It refers to a situation where a refund is granted based on an error.
*This article is only for academic interest.