Commotion observed we hear (5)
I believe the answer is:
scene
'commotion' is the definition.
(I've seen this in another clue)
'observed we hear' is the wordplay.
'observed' becomes 'seen' (synonyms).
'we hear' indicates a 'sounds like' (homophone) clue.
'seen' sounds like 'SCENE'.
(Other definitions for scene that I've seen before include "Panorama" , "View -part of play" , "Excerpt from a play or film" , "Section of a stage work" , "Subdivision of act in play" .)