A man was arrested after being observed acting suspiciously near a spot where a stash of a heroin derivative was found hidden in a hole in a wall.

The Supreme Court heard that Roderick George Astwood, 42, was arrested after two officers followed him into an alleyway and observed him putting a package into a hole in a wall.

Crown counsel Patrick Doherty said foil wraps were also found behind his ear.

Later tests showed the total seizure of diamorphine to be worth close to $1,000.

But it was claimed that the Police officers had arrested Astwood before he reached the hole and a later search found the drugs in the wall.

Astwood pleaded not guilty to possession of diamorphine intended for supply.

The jury, before Chief Justice Austin Ward, heard Mr. Doherty say a Reserve Police officer alerted two regular officers to Astwood's presence on Elliott Street.

P.c. Carmel Amory told the court he saw Astwood outside the entrance to an alley. People had approached on foot and in vehicles, money was exchanged and Astwood gave them something after disappearing into the alley.

But Mark Pettingill, defending Astwood, said that another officer had written his statement for him, which he agreed with.

P.c. Amory denied that one of the arresting officers, Sgt. Peter Morgan, had helped him to put the statement together.

Sgt. Morgan was called to the area and said he saw Astwood entering the alleyway, followed by another officer, P.c. Milton Gilbert.

Once there, he said he saw Astwood reach up and put a bag in a hole in the wall. P.c. Gilbert then approached him and said he was being searched.

Behind his ear he found paper wraps which contained foil wraps and he had over $600 on him.

It was later revealed that there were 54 foil wraps inside the package from the wall.

But Mr. Pettingill questioned the officer whether or not the small amount of diamorphine found on Astwood would have resulted in a possesssion charge.

The case continues today.