Clandestine Removal Needs Independent Corroboration; loose sheets and a director's statement alone were insufficient here.

Allegations of clandestine removal were rejected where the factory search yielded no incriminating material and stock tallied with statutory records. Loose sheets recovered from the Director's residence were insufficient on their own because no effective inquiry established the identity of the person named, procurement of raw material, transport, sales, or abnormal electricity consumption. The Director's un-retracted statement also did not prove clandestine clearance without independent corroboration. As the alleged removal was not established on the available evidence, the demand, interest, and penalties were set aside.

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Issues: Whether the charge of clandestine removal was sustainable on the basis of loose sheets and the Director's statement, in the absence of corroborative evidence.

Analysis: The factory search yielded no incriminating material and the stock of raw material and finished goods tallied with the statutory records. The case rested mainly on loose sheets recovered from the Director's residence, but no effective inquiry was made to identify the person named in those sheets or to establish procurement of raw material, transport of goods, sales, or electricity consumption. The statement of the Director, without retraction, was held insufficient by itself because clandestine removal requires independent corroboration.

Conclusion: The charge of clandestine removal was not proved, and the demand, interest, and penalties were set aside.

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