Clandestine removal and natural justice challenge fail where records, statements, and supporting evidence sustain duty demand and penalties.

Clandestine removal of drums and scrap was upheld where discrepancies between production reports and the RGI, shortages in finished drums, and unaccounted scrap or waste were supported by statements, panchanama material, and evidence from the refinery and job-work chain. The Tribunal found the plea of separate registers for duty-paid and exempt goods unsubstantiated because no timely disclosure or supporting records were produced. A challenge based on denial of natural justice also failed, as the appellant had an opportunity after remand, did not effectively avail personal hearing, and did not place convincing material before the adjudicating authority. Duty demand, confiscation, and penalties were sustained.

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Issues: Whether the appellant had clandestinely manufactured and removed drums and scrap without accounting them in statutory records and without payment of duty, and whether the adjudication suffered from denial of natural justice.

Analysis: The record showed discrepancies between the production reports and the RGI, shortages in finished drums, and unaccounted scrap/waste. The statements recorded during investigation, read with the panchanama and the material obtained from the refinery and job-work chain, were treated as reliable evidence. The contention that separate registers existed for duty-paid and exempt goods was not substantiated by timely disclosure or supporting records. The Tribunal also found that the appellant had been given opportunity after remand, but did not effectively avail the personal hearing or place convincing material before the adjudicating authority. The reasons recorded in the impugned order were held sufficient to reject the defence.

Conclusion: The allegations of clandestine removal and suppression were upheld and the plea of violation of natural justice was rejected; the duty demand, confiscation and penalties were sustained against the appellant.

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