TaxTMI 
TaxTMI 
2017 (6) TMI 526
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....mikumaran, Adv., Mr. S. Seetharaman, Adv., Mr. Darpan Bhuyan, Adv., Mr. Ankur Sharma, Adv.,Mr. Bhargava Manstha, Adv. And For Mr. M.P. Devanath, AOR JUDGMENT A.K. SIKRI, J. On the demand raised by the indigenous industry, original/ordinary investigation concerning imports of Acrylonitrile Butadiene Rubber (hereinafter referred to as the 'product') was taken up sometime in March 1996 for the purpose of levy of anti-dumping duty on the said import from Korea RP and Germany. The primary finding to this effect came to be published on July 17, 1997 whereby the Designated Authority recommended definitive anti-dumping duty. That resulted into issuance of Notification dated July 30, 1997 by the Central Government whereby anti-dumping duty was imposed under Section 9A of the Customs Tariff Act, 1975 (for short, the 'Act') on the said product. Before the expiry of five years period during which anti-dumping duty remains operative, the first sunset review investigation was initiated by the Authority which recommended continued levy of anti-dumping duty. It resulted into another Notification dated October 10, 2002. As per this Notification, the anti-dumping duty was to remain in force....
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....has been allowed to be bad in law. Their appeals challenge that part of the order. On the other hand, writ petitioners are not satisfied with the outcome of the second issue about the initiation of anti-dumping duty. This part is challenged by these two writ petitioners. M/s. Omnova Solution (Pvt.) Limited is the other appellant which is also a domestic industry and has challenged the orders by filing two writ petitions thereby supporting the stand of Union of India and Manufacturers Association. It is for this reason all these appeals are heard analogously, which we propose to decide by this common judgment. 2) Few dates which are material to appreciate the controversy and the stand which is taken by the respective parties need to be recapitulated. Since we are concerned with the validity of initiation of the third sunset review as well as Notification dated January 23, 2014 vide which earlier Notification was amended and extended for a period of one year under Section 9A of the Act, we will mention those dates which revolve around the aforesaid controversy. 3) As mentioned above, after the second sunset review, Notification dated January 02, 2009 was issued extending the pe....
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....of trade in the domestic market of the exporting country or territory, or when because of the particular market situation or low volume of the sales in the domestic market of the exporting country or territory, such sales do not permit a proper comparison, the normal value shall be either - (a) comparable representative price of the like article when exported from the exporting country or territory to an appropriate third country as determined in accordance with the rules made under sub-section (6); or (b) the cost of production of the said article in the country of origin along with reasonable addition for administrative, selling and general costs, and for profits, as determined in accordance with the rules made under subsection(6): Provided that in the case of import of the article from a country other than the country of origin and where the article has been merely transhipped through the country of export or such article is not produced in the country of export or there is no comparable price in the country of export, the normal value shall be determined with reference to its price in the country of origin. (2) The Central Government may, pen....
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...., such duty shall be payable at such rate and from such date as may be specified in the notification. (4) The anti-dumping duty chargeable under this section shall be in addition to any other duty imposed under this Act or under any other law for the time being in force. (5) The anti-dumping duty imposed under this section shall, unless revoked earlier, cease to have effect on the expiry of five years from the date of such imposition: Provided that if the Central Government, in a review, is of the opinion that the cessation of such duty is likely to lead to continuation or recurrence of dumping and injury, it may, from time to time, extend the period of such imposition for a further period of five years and such further period shall commence from the date of order of such extension. Provided further that where a review initiated before the expiry of the aforesaid period of five years has not come to a conclusion before such expiry, the anti-dumping duty may continue to remain in force pending the outcome of such a review for a further period not exceeding one year. (6) The margin of dumping as referred to in subsection (1) or sub-section....
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....five years, but the Authority has not come to a conclusion before such expiry, the anti-dumping duty may continue to remain in force for a further period not exceeding one year. This second proviso, thus, is to provide a stopgap arrangement to take care of those contingencies where review exercise, though initiated earlier, could not be concluded during the currency of anti-dumping duty period specified in the notifications. It is in exercise of this power contained in second proviso to sub-section (5) of Section 9A of the Act that Notification dated January 23, 2014 was issued extending the validity by another year, pending outcome of the sunset review. 6) At this juncture, we shall reproduce relevant texts of Notification dated December 31, 2013 vide which sunset review was initiated, as well as Notification dated January 23, 2014 vide which earlier Notification dated January 02, 2009 was amended by extending its validity by another year: Notification dated December 31, 2013 "To be published in Part-I Section-I of the Gazette of India Extraordinary F NO 15/29/2013-DGAD Government of India Department of Commerce & Industry (Directorate General of Anti....
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....ariff (Identification, Assessment and Collection of Anti dumping Duty on Dumped Articles and for Determination of Injury) Rules, 1995, in the matter of continuation of anti-dumping duty on 'Acrylonitrile Butadiene Rubber', originating in, or exported from Korea RP, imposed vide notification of the Government of India in the Ministry of Finance (Department of Revenue), No. 01/2009-Customs, dated the 2nd January, 2009, published in the Gazette of India, Extraordinary, Part II, Section 3, sub-section (i), vide G.S.R. 5(E), dated the 2nd January, 2009, and has requested for extension of anti-dumping duty for a further period of one year, in terms of sub-section (5) of section 9A of the said Customs Tariff Act; Now, therefore, in exercise of the powers conferred by sub-sections (1) and (5) of section 9A of the Customs Tariff Act, 1975 (51 of 1975) read with rule 23 of the Customs Tariff (Identification, Assessment and Collection of Anti-dumping Duty on Dumped Articles and for Determination of Injury) Rules, 1995, the Central Government hereby makes the following amendment in the notification of the Government of India in the Ministry of Finance (Department of Revenue), No. 01/2....
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.... We now proceed to discuss and answer these questions in seriatim. QUESTION NO.1 9) It is not in dispute that in terms of Section 9A(5) of the Act, anti-dumping duty is effective for a period not exceeding five years from the date of its imposition. The Government is empowered to revoke the duty imposed even before the expiry of five years. In any case, such a duty admittedly ceases to be operative after five years from the date of imposition. At the same time, the Central Government is empowered to initiate review, called 'sunset review', and to investigate and decide as to whether it is necessary to continue the levy of anti-dumping duty. As in the case of original Notification imposing such a duty, the Central Government is to satisfy itself that if the period of anti-dumping duty is not extended, it is likely to lead to continuation or recurrence of dumping and injury to the domestic industry. The nature of exercise to be undertaken by the Central Government in a 'sunset review' is somewhat different from the initial exercise to determine whether anti-dumping duty is to be levied at all or not. When it comes to review, the focus would be on the issue as to whether withdra....
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....f recurrence of dumping of the subject goods, originating in or exported from Korea RP, and a consequent injury to the domestic market and requested for another review. The Notification thereafter deals with the situation of domestic industry, product in question and satisfaction of the Authority that a case was made out for initiation of sunset review investigation to review the need for continued imposition of anti-dumping duty in force in respect of the product in question. The Notification thereof calls upon the interested parties to submit relevant information in the prescribed form and manner and furnish their views to the Authority for its consideration. Thus, a detailed exercise was done taking into account all the relevant factors in forming the opinion that the sunset review was desirable. 11) Though the Notification is dated December 31, 2013 and published on the same date, it was sent for distribution to Kitab Mahal Book Store on January 06, 2014. The validity would depend upon the issue as to whether December 31, 2013 is the date of reckoning or it is only January 06, 2014. 12) The High Court has answered the question in favour of the Government and against the w....
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....at whenever Designated Authority has decided to initiate investigation to determine the existence, degree and effect of any alleged dumping of any article, it shall issue a public notice underlying its decision and also mention the particulars/information which shall be provided in the said public notice. This Rule thereafter narrates the procedure which is to be followed which includes providing opportunity to the industrial user of the article under investigation and the respective consumer organisation in cases where the article is commonly sold at the retail level, to furnish information which is relevant to the investigation regarding dumping/injury where applicable, and casualty. The High Court is right that it is in this specific context that the said Rule mentions about issuance of public notice underlying its decision to initiate the investigation. Rule 23 deals with review, i.e. review to see the need for the continued imposition of anti-dumping duty and inter alia mentions that provisions of Rule 6 shall be mutatis mutandis applicable in the case of review, meaning thereby the procedure which is mentioned in Rule 6 shall be followed while undertaking review as well. Rule....
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....one in the present case vide Notification dated March 31, 2013, it shows that the Central Government is, prima facie, satisfied that there is a justification in the request made by the indigenous industry for continuation of such a duty. Therefore, till this exercise is complete, necessary consequence has to be to continue anti-dumping duty and it is for this reason the second proviso to sub-section (5) of Section 9A of the Act is added in the statute. Otherwise, it was argued, the very purpose of this proviso stands defeated. 20) She submitted that the word 'may' occurring in the said proviso should be read as 'shall'. She also pointed out that in the instant case itself, after the completion of 'sunset review exercise', final notification was issued on September 04, 2015 signifying the continuation of anti-dumping duty was justified. On that basis, it was argued that there should not be a position of hiatus or vacuum in between, which also justifies the interpretation that the extension under the second proviso is automatic. For this purpose, learned Additional Solicitor General referred to the following discussion in the case of Rishiroop Polymers (P) Ltd. v. Designated Autho....
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....rders, etc., issued under enactments repealed and re-enacted: Where any [Central Act] or Regulation, is, after the commencement of this Act, repealed and re-enacted with or without modification, then, unless it is otherwise expressly provided any [appointment notification,] order, scheme, rule, form or bye-law, [made or] issued under the repealed Act or Regulation, shall, so far as it is not inconsistent with the provisions re-enacted, continue in force, and be deemed to have been [made or] issued under the provisions so re-enacted, unless and until it is superseded by any [appointment notification,] order, scheme, rule, form or bye-law, [made or] issued under the provisions so re-enacted [and when any [Central Act] or Regulation, which, by a notification under section 5 or 5A of the Scheduled Districts Act, 1874, (14 of 1874) or any like law, has been extended to any local area, has, by a subsequent notification, been withdrawn from the re-extended to such area or any part thereof, the provisions of such Act or Regulation shall be deemed to have been repealed and re-enacted in such area or part within the meaning of this Section]. 22) She also relied upon the judgment ....
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....inue to remain in force pending the outcome of such a review for a further period not exceeding one year" and there is no mention of any affirmative act by the Central Government or the need to issue a notification providing for levy of an anti-dumping duty. Therefore, the proviso does not require any positive act, on the part of the Central Government. It is the Designated Authority, which has not concluded, is sufficient for continuation of the duty for a further period not exceeding one year. 25) On the basis of the aforesaid submissions, plea of Mr. Patil was that the word 'may' has to be read as 'shall' because of the reason that if interpreted otherwise, it would frustrate the objective of the provision, as held in N. Nagendra Rao & Co. v. State of A.P. (1994) 6 SCC 205) (para 3) as well as Dinkar Anna Patil and Another v. State of Maharashtra and Others (1999) 1 SCC 354) (para 26). Mr. Patil also endeavoured to take sustenance from the judgement of this Court in Sub-Committee on Judicial Accountability v. Union of India and Another (1991) 4 SCC 699) wherein this Court held that "the enabling words are construed as compulsory whenever the object of the power is to effectua....
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....not be read to mean "continue without interruption". The word continue can mean both continuation with or without interruption and considering that the Act specifically permits initiation of investigations prior to expiry of duty, it follows that the word "continue" under the Act would include continuation with a break. 27) In support of this contention, he relied upon the decision of a Constitution Bench of this Court in Life Insurance Corporation of India v. Escorts Ltd. (1986) 1 SCC 264) that in the absence of expression such as "prior" or "previous", it cannot be contended that extension ought to have been granted before the expiry of the original period. He submitted that when a statute enacted in the national economic interest comes up for consideration, the traditional norms of statutory interpretation must yield to broader notions of national interest and that, therefore, the Court has to interpret the statute in tune with the national interest that the statute sought to sub-serve. Para 63 reads as follows: "63. We are conscious that the word "prior" or "previous" may be implied if the contextual situation or the object and design of the legislation demands it, ....
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....second proviso uses the language 'the anti-dumping duty' may continue to remain in force pending the outcome of such a review for a further period not exceeding one year. Laying stress on the words 'for a further period not exceeding one year', he argued that it was not necessary that the duty has to be extended for a full period of one year and such a period can be shorter one as well, i.e., less than a year. This would itself suggest that a Notification is mandated to prescribe the actual period which, in no case, can be more than one year. He also put emphasis on the word 'continue' in the aforesaid expression to argue that it would mean that there should be no discontinuance. Predicated on this, submission of Mr. Lakshmikumaran was that once the period prescribed by the original Notification expires, the right to exercise power under second proviso also comes to an end inasmuch as any notification issued after the expiry, and with a gap, would not be a case of anti-dumping duty 'continues to remain in force'. The learned counsel referred to two judgments in support of his arguments, viz. (i) Babu Varghese v. Bar Council of Kerala (1999) 3 SCC 422) and Harivansh Lal Mehra v. ....
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....e High Court that proviso to sub-section (5) of Section 9A of the Act is an enabling provision. That is very clear from the language of the said provision itself. Sub-section (5) of Section 9A gives maximum life of five years to the imposition of anti-dumping duty by issuing a particular notification. Of course, this can be extended by issuing fresh notification. However, the words 'unless revoked earlier' in sub-section (5) clearly indicate that the period of five years can be curtailed by revoking the imposition of anti-dumping duty earlier. Of course, provision for review is there, as mentioned above, and the Central Government may extend the period if after undertaking the review it forms an opinion that continuation of such an anti-dumping duty is necessary in public interest. When such a notification is issued after review, period of imposition gets extended by another five years. That is the effect of first proviso to sub-section (5) of Section 9A. However, what we intend to emphasise here is that even as per sub-section (5) it is not necessary that in all cases anti-dumping duty shall be imposed for a full period of five years as it can be revoked earlier. Likewise, when....
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....od the implications thereof, therefore, when the word 'may' is used in the same Section in contradistinction to the word 'shall' at other places in that very Section, it is difficult to interpret the word 'may' as 'shall'. Therefore, it is difficult to read the word 'may' as 'shall'. Our conclusion gets strengthened when we keep in mind following additional factors: 33) The anti-dumping duty may continue, pending the outcome of the review, for a further period not exceeding one year. Thus, maximum period of one year is prescribed for this purpose which implies that the period can be lesser as well. The Government is, thus, to necessarily form an opinion as to for how much period it wants to continue the anti-dumping duty pending outcome of such a review. Moreover, since the maximum period is one year, if the review exercise is not completed within one year, the effect of that would be that after the lapse of one year there would not be any anti-dumping duty even if the review is pending. In that eventuality, it is only after the review exercise is complete and the Central Government forms the opinion that the cessation of such a duty is likely to lead to continuation or recur....
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...., 2014? If so, whether this Notification would take effect from January 01, 2014 or January 23, 2014? 36) As noticed above, the High Court has held that once the earlier Notification by which anti-dumping duty was extended by five years, i.e. up to January 01, 2014, expired, the Central Government was not empowered to issue any Notification after the said date, namely, on January 23, 2014, inasmuch as there was no Notification in existence the period whereof could be extended. The High Court, in the process, has also held that the Notification extending anti-dumping duty by five years, i.e. up to January 01, 2014 was in the nature of temporary legislation and validity thereof could be extended, in exercise of powers contained in second proviso to sub-section (5) of Section 9A of the Act only before January 01, 2014. 37) We do not find any infirmity in the aforesaid approach of the High Court in interpreting the second proviso to Section 9A(5) of the Act. The High Court has rightly interpreted the aforesaid provision in the light of Article 11.1, 11.2 and 11.3 of the Agreement for Implementation and Article VI of the GATT, commonly known as 'Implementation Agreement'. These cl....