It was fine to lead and continue
Diamonds, but East missed a chance when Declarer took that Heart finesse. Yes,
indeed, East should smoothly duck that trick! When Declarer repeats the Heart
finesse, East pounces with the King and shoots back a Club. With no entries to
Dummy’s Hearts, Declarer is up the creek and down one.
Next, suppose that, when the
Heart finesse is taken, East ducks, but this time not smoothly. Now a
resourceful Declarer may smell a rat, in which case he can make the contract
anyway. He wins the second round of Hearts with the Ace, and cashes the Clubs.
By now West is down to ♠K6 and
♦82.
Declarer has ♠A98 and ♦7
and will exit with the Diamond. After taking his two Diamonds, West is forced
to play Spades, and if Declarer guesses correctly he will play the ♠Q and make
his contract.
Post Script:
Of course, it would be quite improper for East, when not holding the
♥K,
to fake out Declarer by hesitatingly unduly on the first Heart, simulating a
non-smooth duck. Such shenanigans are OK for poker, but not for bridge.