Section 9D compliance is mandatory before statements recorded...

Section 9D compliance is mandatory before statements recorded under section 14 of the Central Excise Act can be relied on; where the maker is not first examined and the statement is not admitted in accordance with section 9D, denial of cross-examination does not cure the defect, and such statements cannot support the demand. Clandestine manufacture and removal must be proved by positive, clinching corroborative evidence; in the absence of documentary support, excess inputs, unrecorded production, stock discrepancy, or transport records, the allegation failed. Penalty under rule 26 also could not stand without a finding that the goods were liable to confiscation, so the duty demand and penalties were set aside.