Clandestine removal proved by private records and director admission; extended limitation upheld for suppression-based evasion.

Private notebooks, loose papers and stock verification, when corroborated by invoices and an un-retracted director's statement admitting receipt of raw materials and clandestine clearances, were treated as sufficient to prove clandestine removal of excisable goods and sustain the duty demand. The absence of a statement from the alleged notebook author did not displace the corroborated private records and admissions. Because the evasion was detected only through departmental investigation and the facts showed suppression from the department, the extended period of limitation was held invocable and the demand was not time-barred. The duty demand and connected consequences were restored.

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Issues: (i) Whether clandestine removal of excisable goods and inputs was proved on the basis of private notebooks, loose papers and the director's statement; (ii) Whether the demand was barred by limitation.

Issue (i): Whether clandestine removal of excisable goods and inputs was proved on the basis of private notebooks, loose papers and the director's statement.

Analysis: The demand was founded on private records recovered during search, cross-verified with invoices and stock verification. The director's statement specifically admitted that the notebooks contained details of receipt of raw materials and clearances of finished goods both with and without payment of duty, and also admitted the clearances reflected in the departmental charts as clandestine. The statement was not retracted and was treated as admissible evidence. The absence of a statement from the alleged author of the notebooks did not outweigh the director's admission of the contents and the corroboration from the recovered records.

Conclusion: Clandestine removal was held proved and the evidentiary basis for the duty demand was upheld in favour of Revenue.

Issue (ii): Whether the demand was barred by limitation.

Analysis: The evasion came to light only through departmental investigation and relied on non-statutory private records, indicating suppression of facts from the department. On those facts, the extended period of limitation was held to be invocable.

Conclusion: The demand was held not to be time-barred and limitation was decided in favour of Revenue.

Final Conclusion: The impugned order was set aside and the duty demand and connected consequences were restored.

Ratio Decidendi: Private records corroborated by an un-retracted, inculpatory statement of the director can establish clandestine removal, and suppression revealed only through investigation justifies invocation of the extended period of limitation.

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