Safeguard duty interim stay vacated after final findings showed increased imports and serious injury risk to domestic industry.

Interim protection against payment of safeguard duty was vacated because the final findings under section 8B of the Customs Tariff Act, 1975 prima facie disclosed increased imports, market-share shifts, declining profitability, rising inventories, price undercutting and a threat of serious injury to the domestic industry. The Court held that, at the interlocutory stage, it was unnecessary to reappraise the merits in detail and the findings were not shown to be perverse. On balance of convenience, continuation of the stay would neutralise the safeguard measure, while the importers had a pass-through mechanism and a refund remedy if they ultimately succeeded. The Court also accepted that continuing the interim order would cause irreparable injury to the domestic industry.

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Issues: Whether the ex parte ad-interim relief protecting the importer from payment of safeguard duty should be vacated on the ground that the final findings under the safeguard duty regime prima facie disclosed a valid case of increased imports causing serious injury and threat of serious injury to the domestic industry.

Analysis: The application to vacate the interim protection was examined in the context of section 8B of the Customs Tariff Act, 1975 and the rules governing safeguard duty. The material before the Court showed that the Designated Authority had restricted the domestic industry to two producers and had recorded that they constituted the required major share, and that increased imports, market share shifts, declining profitability, rising inventories, price undercutting and threat of future injury had been considered in the final findings. The Court held that, at the interlocutory stage, a detailed reappraisal of the merits was unnecessary and that the findings were not shown to be perverse. On balance of convenience, the Court accepted that continuation of the interim order would effectively neutralise the safeguard measure, while the importers had a mechanism for pass-through of duty changes and a refund remedy if they ultimately succeeded. The Court also found that the domestic industry would suffer irreparable injury if the interim protection continued.

Conclusion: The interim relief was vacated, and the application succeeded.

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