Clandestine removal requires corroborative evidence; confiscation was set aside and penalties reduced on the facts.

Confiscation of goods alleged to be cleared clandestinely requires corroborative evidence showing intended unlawful removal; where duty liability has already been accepted and the record does not clearly establish clandestine clearance, confiscation from the manufacturing premises is not justified. The surrounding facts may also support moderation of monetary consequences, so redemption fine and penalties can be reduced where the original quantum is excessive, including for a unit with a limited role in the transaction. In the stated facts, confiscation was set aside for one set of goods, while the redemption fine and penalties were reduced and the remainder of the adjudication was sustained.

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Issues: (i) Whether the goods seized from the appellants' premises were liable to confiscation on the allegation of clandestine removal. (ii) Whether the redemption fine and penalties imposed required interference on quantum.

Issue (i): Whether the goods seized from the appellants' premises were liable to confiscation on the allegation of clandestine removal.

Analysis: The duty liability had already been accepted and paid, but confiscation had to rest on material showing that the seized goods were meant for clandestine clearance. The records showed that the appellants' declared clearances were around the small scale exemption threshold, and the seizure value, even when aggregated, did not establish a clear case of clandestine removal. The absence of corroborative evidence meant that confiscation of the goods from the manufacturing premises was not justified.

Conclusion: Confiscation of the goods from the manufacturing premises was set aside.

Issue (ii): Whether the redemption fine and penalties imposed required interference on quantum.

Analysis: Although the appellants had admitted duty liability and accepted clandestine activity, the facts warranted moderation of the monetary consequences. For the manufacturing unit, the penalty was considered excessive in the circumstances and was reduced. For the trading unit, redemption fine and penalty were also reduced in view of its limited role and the surrounding facts.

Conclusion: The redemption fine and penalties were reduced.

Final Conclusion: The appeal succeeded only to the extent of setting aside confiscation for one set of goods and reducing the redemption fine and penalties, while the rest of the adjudication was sustained.

Ratio Decidendi: Confiscation for alleged clandestine removal cannot be sustained without corroborative evidence, and monetary penalties may be moderated where the surrounding facts do not justify the original quantum.

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