Siemens Engineering and Manufacturing Co of India Ltd v Union of India

• The appellants imported pot motors for a rayon spinning plant. Customs first assessed them under item 72(3) of the Indian Customs Tariff (component parts of machinery). The Assistant Collector later demanded differential duty under item 73(21) (electric motors) and rejected the appellants' representation without giving any reasons. The Collector rejected their appeal on a thin reason, and the Government of India rejected their revision without reasons (Civil Appeal 1277 of 1968).

1. (1) Whether pot motors fell under item 72(3) or item 73(21). (2) Whether the authorities, acting quasi-judicially, were bound to give reasons for their orders.

• (1) Item 72(3) is a specific item covering pot motors, as against the general item 73(21); the original assessment was correct and the demand for differential duty was unjustified. (2) Where an authority makes an order in exercise of a quasi-judicial function it must record its reasons. Administrative authorities and tribunals must accord a fair hearing and give sufficiently clear and explicit reasons. The rule requiring reasons is, like audi alteram partem, a basic principle of natural justice, and must be observed in its proper spirit; a mere pretence of compliance will not do. The Assistant Collector and the Government had given no reasons and the Collector's reason was hardly satisfactory. The appeal was allowed. The Court also suggested an independent quasi-judicial tribunal for customs and excise appeals.

Every quasi-judicial order must be supported by reasons; the duty to give reasons is a principle of natural justice, and mere pretence of compliance does not satisfy it.