Clandestine removal demands need independent corroboration; third-party records and unverified statements were insufficient to sustain duty or penalty.

Allegations of clandestine removal cannot be sustained on third-party documents or uncorroborated statements alone; independent, clinching evidence from the manufacturer's records, premises, raw material movement, transport trail, electricity use, or sale realization is required. On that basis, the duty demand and related confirmation against the manufacturer and its director were set aside. A penalty on a third-party facilitator also fails where it rests on the same unverified material and no independent evidence shows active facilitation; the penalty was therefore set aside.

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Issues: (i) Whether the demand of duty and related confirmation against the manufacturer and its director for alleged clandestine removal could be sustained on the basis of third party documents and uncorroborated statements; (ii) Whether the penalty imposed on the third party facilitator could be sustained in the absence of independent corroborative evidence.

Issue (i): Whether the demand of duty and related confirmation against the manufacturer and its director for alleged clandestine removal could be sustained on the basis of third party documents and uncorroborated statements.

Analysis: The allegations rested on documents recovered from a third party premises and on a statement that was not corroborated by any independent material from the manufacturer's own records, premises, raw material trail, transport trail, electricity consumption, sale realization, or other clinching evidence. The statement sought to connect the word attributed in the third party record with the appellants, but no supporting evidence established that connection. A demand for clandestine removal cannot be confirmed on presumptions, assumptions, or third party evidence alone, and the evidentiary requirements for relying on such statements were not satisfied.

Conclusion: The duty demand and related confirmation against the manufacturer and its director were not sustainable and were set aside.

Issue (ii): Whether the penalty imposed on the third party facilitator could be sustained in the absence of independent corroborative evidence.

Analysis: The penalty was founded on the same investigation and the same uncorroborated material that had already been found insufficient to establish the principal allegation. In the absence of independent evidence showing active facilitation of clandestine removal, the penalty could not stand merely on the basis of the disputed statement and third party records. The lack of cogent evidence and the absence of reliable corroboration rendered the penalty unsustainable.

Conclusion: The penalty imposed on the third party facilitator was not sustainable and was set aside.

Final Conclusion: The impugned order could not be sustained because the allegations of clandestine removal and facilitation were not proved by legally admissible and corroborated evidence.

Ratio Decidendi: Allegations of clandestine removal or facilitation thereof cannot be sustained solely on third party documents or uncorroborated statements; they require independent, clinching, and legally admissible evidence, and any reliance on statements must satisfy the statutory requirements governing their evidentiary use.

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