Principle of Natural Justice

Principle of Natural Justice
Adv. Dinesh Verma

Respected Member’s
As we know that the basic motive of principle of natural
justice is to ensure fairness in social and economic activities
of the people and also shields individual liberty against the
arbitrary action. But what exactly are these principles?
In this article we can talk about the principles of natural
justice and principle for issuing show cause notice.
1) Introduction
The concept of natural justice though not provided in
Indian constitution but it is considered as necessary
element for the administration of justice. Natural
justice is a concept of common law which has its
origin in “jus natural” which means law of nature. In
its layman language natural justice means natural
sense of what is right or wrong. ‘Natural’ justice is not
justice found in nature; it is a compendium of
concepts which must be naturally associated with
justice, whether these concepts are incorporated in
law or not. Justice is a great civilizing force. It ensures
that the rule of law rather than the rules of nature
prevail in regulating human conduct. Natural justice
has a very wide application in administrative
discretion. Its aims to prevent arbitrariness and
injustice towards the citizens with an act of
administrative authorities. The concept of natural
justice was confined to the judicial proceedings only
but with the advent of welfare state the powers of
administrative authorities have considerably
increased as a result it becomes impossible for law to
determine the fair procedure to be followed by each
authority while adjudicating any disputes or any
quasi-judicial proceedings.
2) Principles Of Natural Justice

Natural justice is concerned with 2 primary rules.
These are:
• Nemo Judex In Causa Sua (rule against bias)
• Audi Alteram Partem (rule of fair hearing)
Nemo Judex In Causa Sua means rule against bias. It

is the first principle of natural justice which says no
man shall be judge in his own cause or a deciding
authority must be impartial and neutral while
deciding any case. Thus the principle signify that in a
circumstances where a judge or deciding authority is
suspected to be bias an partial then he/she shall be
disqualify for determining any case before them. It
formulate that justice should not only be done but
seen to be done.
Audi Alteram Partem It means hear the other side as
well. This is the second most fundamental rule of
natural justice that says no one should be
condemned unheard. In a circumstances where a
person against whom any action is sought to be taken
and his right or interest is being affected, shall be
given an equal opportunity of being heard.
The Hon’ble supreme court in CCE & Land Customs v

Sanawarmal Purohit 1979 (4) ELT j 613 (SC) held that
it is true that a quasi-judicial authority is not required
to hold an enquiry into a dispute before him
according to the procedure followed in a court.
Where a tribunal which has the power to make any
enquiry as it thinks fit, decides a case on a matter of
fact discovered by the tribunal itself on inspecting the
premises in question, it will be breach of natural
justice if it does not inform the parties and give them
a chance of dealing with it. If a tribunal receives from
a third party a document relevant to the subject
matter of the proceedings, it should give both parties
an opportunity of commenting on it. It was the duty
of the collector of customs to inform the persons
charged before him of the charges against them. A
quasi-judicial authority would be acting contrary to
the rules of natural justice if it acts on information
collected by it which has not been disclosed to the
party concerned and with respect to which full
opportunity of meeting the inferences which arise
out of it has not been given.
With reference to principles of natural justice, the
Supreme court in Automotive Tyre Manufactures
Asson. V Designated Authority 2011 (263) ELT 481
(SC) held that it is trite that the rules of ‘natural
justice’ are not embodied rules. The underlying
principle of natural justice, evolved under the
common law, is to check the arbitrary exercise of
power by the state or its functionaries. Therefore, the
principle implies a duty to act fairly i.e. fair play in
action. In this case, the materials collected by the
previous designated authority for antidumping were
used by the successor without hearing the aggrieved
parties. Therefore the same was interfered with as
being a violation of the principles of natural justice.
3) Principles for issuing show cause

notice
The indirect tax legislations in Section 11A of the
Central Excise Act, 1944, Section 73 of the Finance
Act, 1994 and Section 28 of the Customs Act, 1962
make it mandatory to issue show cause notices
before adjudicating a matter. Therefore, it would be
relevant to notice a few principles in that regard.
• Whether it is mandatory to issue show cause notice?
In UOI Vs. Madhumilan Syntex Ltd. 1988 (35) ELT
349, the supreme court held that any demand raised
without issuing show cause notice or granting a
hearing would be invalid in terms of Section 11A of
the Central Excise Act, 1944. In CCE Vs. Kosan Metal
Products Ltd. 1988 (38) ELT 573, the Supreme court
held that show cause notice is necessary before
adjudication and mere noting in the periodical
returns is not a notice.
• Whether unsigned show cause notice is valid?
In the case of Harichand K. Khanna Vs. C.C.E.
2002(150) ELT 1323 (Tri-
LB) it was held that a show cause notice would not
become invalid if the copy served was not signed by
the Commissioner but was attested by the Asst.
Commissioner, as long as the office copy was
initialled by the Commissioner. It must be said that
the law in this regard has to be considered strictly. It
is noticed in several matters that notices and orders
are drafted by subordinates with the Commissioner
merely affixing his signature.
• When can the notice be issued?
As per the legislative provisions, show cause notices
can be issued wherever the duties/taxes have not
been levied, not been paid or have been short-levied
or short-paid or erroneously refunded.
Meaning of
(a) Short levy-> where the tax/ duty has been levied.
(b) Non-levy-> Non-levy of a duty or tax arises when
the same has not at all been charged on the product
or service.
(c) Short-paid-> The term short payment means
payment of an amount less than what is due.
(d) Erroneous refund-> an erroneous refund refers to
a situation where a refund is granted based on an
error.
4) Conclusion
The principles of natural justice have been adopted
and followed by the judiciary to protect public rights
against the arbitrary decision by the administrative
authority. It is supreme to note that any decision or
order which violates the natural justice will be
declared as null and void in nature, hence one must
carry in mind that the principles of natural justice are
essential for any administrative settlement to be held
valid.
In India the principles of natural justice are provided

in Article 14 & 21 of the Constitution of India. With
the introduction of concept of substantive and
procedural due process in Article 21, all that fairness
which included in the principles of natural justice can
be read into Article 21.
The principle of natural justice is not confined to
restrict walls the applicability of the principle but
depends upon the characteristics of jurisdiction,
grant to the administrative authority and upon the
nature of rights affected of the individual.
Please give your respective feedback.

Warm Regards
Adv. Dinesh Verma

Principle of Natural Justice

Uploaded by

Document Information

Original Description:

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Principle of Natural Justice

Uploaded by

Copyright:

Available Formats

Principle of Natural Justice

Adv. Dinesh Verma

2) Principles Of Natural Justice

Nemo Judex In Causa Sua means rule against bias. It

The Hon’ble supreme court in CCE & Land Customs v

3) Principles for issuing show cause

In India the principles of natural justice are provided

Please give your respective feedback.

You might also like