Clandestine removal can be proved by admissions, seized records, and surrounding circumstances even without direct evidence for every link.

Clandestine removal of processed fabrics can be proved by a coherent chain of admissions, recovered incriminating documents, stock discrepancies, unaccounted goods, and surrounding circumstances, even without direct proof of every link. Here, statements of the managing director, accountant, and dealers, together with duplicate invoices, kutcha slips, intercepted goods, and excess stock from dealers' premises, supported the department's case. Belated retractions did not displace the corroborated evidence, and denial of cross-examination did not by itself vitiate the proceedings where the material was otherwise reliable. On that basis, duty demand and penalties were held sustainable.

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Issues: Whether the demand of duty and penalties for clandestine removal of processed fabrics could be sustained on the basis of statements, recovered documents, excess and unaccounted goods, and whether denial of cross-examination vitiated the proceedings.

Analysis: The material on record showed discrepancies in stock, interception of a vehicle carrying non-duty-paid goods, recovery of duplicate invoices without duty particulars, unaccounted goods from dealers' premises, and kutcha slips and other incriminating documents. The statements of the managing director, accountant, and dealers described the modus operandi of clearing goods after altering invoice figures and paying duty only on a fraction of the actual quantity. The retractions were belated, and the statements were corroborated by seized records and physical evidence. In clandestine removal cases, the entire chain need not be proved by direct evidence where the circumstances and admissions form a coherent evidentiary basis.

Conclusion: The demand of duty and the penalties were sustainable, and denial of cross-examination did not vitiate the order.

Ratio Decidendi: Clandestine removal may be established by a combination of admissions, recovered incriminating documents, unaccounted goods, and surrounding circumstances, and a belated retraction or absence of cross-examination does not by itself negate such proof where the evidence is otherwise corroborative.

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