Clandestine removal not proved where evidence lacked corroboration and Tribunal's factual findings showed no perversity.

The Tribunal's finding that clandestine removal and suppression of duty liability were not proved was upheld because it had evaluated the seized notebooks, witness statements and surrounding investigation, and found the revenue evidence unreliable after cross-examination and lacking corroboration such as a money trail, transport proof or other supporting circumstances. The High Court treated these conclusions as findings of fact based on appreciation of evidence and held that the revenue had not shown any ignored material or perversity. No substantial question of law arose for interference, so the Tribunal's conclusion stood.

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Issues: Whether the Tribunal was justified in holding that clandestine removal and suppression of duty liability were not established on the evidence on record, and whether any substantial question of law arose for interference with the Tribunal's findings.

Analysis: The Tribunal had examined the seized notebooks, statements of buyers, suppliers, transporters and employees, and the surrounding investigation. It found that the statements relied upon by the revenue were materially weakened in cross-examination, that there was no reliable corroboration such as proof of money trail, transportation to buyers, receipt of major raw materials, excess consumption indicators, or other supporting circumstances, and that the evidence as a whole did not establish clandestine manufacture and removal. The High Court held that these were findings of fact based on appreciation of evidence and that the revenue had not shown that material evidence was ignored or that the findings were perverse.

Conclusion: The Tribunal's conclusion that clandestine removal was not proved was upheld, and no substantial question of law arose for interference.

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