TaxTMI 
TaxTMI 
2022 (12) TMI 830
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....endation having being made by the designated authority in the final findings notified on 31.03.2022 for imposition of anti-dumping duty under section 9A of the Customs Tariff Act 1975 [the Tariff Act], the Central Government did not issue the notification for imposition of anti-dumping duty. The relief, therefore, that has been claimed in the appeal is that the office memorandum dated 06.06.2022 issued by the Ministry of Finance, Department of Revenue, Tax Research Unit conveying the decision of the Central Government not to impose anti-dumping duty proposed in the final findings of the designated authority be set aside and a direction be issued to the Central Government to issue a notification for imposition of antidumping duty, based on the recommendation made by the designated authority. 2. During the pendency of the appeal two Miscellaneous Applications bearing no's. 50691 of 2022 and 50692 of 2022 were filed by the appellant. 3. The former application contains the following two prayers: "a) pending final hearing of this appeal, impose the provisional anti-dumping in terms of the sub-section 2 of Section 9A of the Customs Tariff Act, 1975 at the rates mentioned i....
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....ated authority notified the final findings on 31.03.2022. The relevant portions of the conclusion drawn and the recommendation by the designated authority in the final findings are as follows: "K. CONCLUSION & RECOMMENDATIONS 201. Having regard to the contentions raised, submission made, information provided and facts available before the Authority as recorded above and on the basis of the above analysis of dumping and consequent injury to the domestic industry, the Authority concludes that: a. The subject goods produced by the domestic industry is a like article to the product under consideration imported from the subject countries. b. While there is a particular market situation in Saudi Arabia, there is no evidence to show that it prevented a proper comparison between the domestic and export sales. c. The Authority has determined that dumping margin for exports from Qatar and UAE is negative. Thus, the Authority concludes that imports from Qatar and UAE into India are not dumped imports. Rule 14(c) of the Rules requires that the Authority shall terminate an investigation immediately if it determines that the margin of dumping is less ....
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.... profitability parameters show a significant adverse impact. This implies that while the domestic industry was able to increase its market share, it was forced to compromise on its profits and reduce its prices to achieve the same. This is because the imports entered the market at prices below the prices of the domestic industry. The price of imports has declined, despite an increase in the price of ethylene. It is, therefore, evident that while the domestic industry has not suffered injury in terms of its volume parameters, the imports have adversely impacted the profitability of the domestic industry. Thus, the domestic industry has suffered material injury. n. The domestic industry is engaged in production of a number of polymers. However, injury analysis is required to be conducted with reference to the performance of the like article, or the narrowest range or group of products, which includes the like article. Therefore, the performance of the polymer segment as a whole is not determinative of the performance of the domestic industry for the subject goods. o. The injury to the domestic industry has been caused by the dumping of the subject imports in India, ....
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....industry by dumping of the subject goods and that non imposition of antidumping duty would adversely impact the production in India. The designated authority ultimately concluded that the domestic industry had suffered material injury due to significant dumping of the subject goods from the subject countries and, therefore, made a recommendation to the Central Government to impose anti-dumping duty on the import of the subject goods from the subject countries. 8. An office memorandum dated 06.06.2022 was then issued by the Ministry of Finance to convey the decision of the Central Government not to impose anti-dumping duty. It is reproduced below: "F. No. CBIC-190354/211/2021-TRU Section -CBEC Government of India Ministry of Finance Department of Revenue (Tax Research Unit) *** Room No. 156, North Block, New Delhi, dated 6th June, 2022 OFFICE MEMORANDUM Subject: Anti-Dumping Investigation concerning imports of "Low Density Polyethylene (LDPE)" from Qatar, Saudi Arabia, Singapore, Thailand, United Arab Emirates and United Sates of America-regarding The undersigned is directed to refer to antidumping investigation final findings on the a....
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....he margin of dumping in relation to such article. The margin of dumping, the export price and the normal price have all been defined in section 9A(1) of the Tariff Act. 12. Sub-section (5) of section 9A provides that anti-dumping duty imposed shall, unless revoked earlier, cease to have effect on the expiry of five years from the date of such imposition. 13. Sub-section (6) of the section 9A of the Tariff Act provides that the margin of dumping has to be ascertained and determined by the Central Government, after such enquiry as may be considered necessary and the Central Government may, by notification in the Official Gazette, make rules for the purpose of this section. 14. In exercise of the powers conferred by sub-section (6) of section 9A and sub-section (2) of the section 9B of the Tariff Act, the Central Government framed the 1995 Anti-Dumping Rules. 15. The duties of the designated authority are contained in rule 4 and the relevant portion is reproduced below: "4. Duties of the designated authority.- xxxxxxxxxxx (d) to recommend to the Central Government- (i) the amount of anti-dumping duty equal to the margin of dumping or less, which if ....
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....anation: For the purpose of this sub-rule, the notice calling for information and other documents shall be deemed to have been received one week from the date on which it was sent by the designated authority or transmitted to the appropriate diplomatic representative of the exporting country. (5) The designated authority shall also provide opportunity to the industrial users of the article under investigation, and to representative consumer organizations 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 causality. (6) The designated authority may allow an interested party or its representative to present the information relevant to the investigation orally but such oral information shall be taken into consideration by the designated authority only when it is subsequently reproduced in writing. (7) The designated authority shall make available the evidence presented to it by one interested party to the other interested parties, participating in the investigation. (8) In a case where an interested party refuses access to, or ....
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....f initiation of an investigation, determine as to whether or not the article under investigation is being dumped in India and submit to the Central Government its final finding- (a) as to, - (i) the export price, normal value and the margin of dumping of the said article; (ii) whether import of the said article into India, in the case of imports from specified countries, causes or threatens material injury to any industry established in India or materially retards the establishment of any industry in India; (iii) a casual link, where applicable, between the dumped imports and injury; (iv) whether a retrospective levy is called for and if so, the reasons therefor and date of commencement of such retrospective levy: xxxxxxx (b) Recommending the amount of duty which, if levied, would remove the injury where applicable, to the domestic industry after considering the principles laid down in the Annexure III to rules." 21. Rule 18 deals with levy of duty and the relevant portion is reproduced below: "18. Levy of duty.- (1) The Central Government may, within three months of the date of publication of final....
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.... if the function performed by the Central Government was legislative, then too the principles of natural justice and the requirement of a reasoned order have to be compiled with since the Central Government would be performing the third category of conditional legislation contemplated in the judgment of the Supreme Court in State of Tamil Nadu vs. K. Sabanayagam and another [(1998) 1 SCC 318] . The relevant observation of the Bench in Apcotex Industries Limited are as follows: "75. Thus, even if it is assumed that the Central Government exercises legislative powers when it imposes anti-dumping duty or has taken a decision not to impose anti-dumping under section 9A of the Tariff Act, it would still be a piece of conditional legislation falling under the third category of conditional legislations pointed out by the Supreme Court in K. Sabanayagam. This is for the reason that in the scheme of the Tariff Act and the 1995 Anti-Dumping Rules, the Central Government has necessarily to examine all the relevant factors prescribed in the Tariff Act and the Rules for coming to a conclusion whether anti-dumping duty has to be levied or not. It cannot be that it is only the desi....
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.... by applying the broad legislative framework and policy already set out in the Statute is not at all legislative in character, but clearly a quasi- judicial function requiring the Central Government to follow the principles of natural justice by affording an opportunity to the party likely to be adversely. ***** 82. In view of the judgments of the Supreme Court in K. Sabanayagam, Cynamide India Ltd. and Godawat Pan Masala, and the decision of the Tribunal in Jubilant Ingrevia Limited, it has to be held that reasons have to be recorded by the Central Government when it proceeds to form an opinion not to impose any anti-dumping duty despite a positive recommendation made by the designated authority in the final findings for imposition of anti-dumping duty." (emphasis supplied) 28. The Bench also examined the requirements of compliance of the principles of natural justice and a reasoned order and held as followed: "82. In view of the judgments of the Supreme Court in K. Sabanayagam, Cynamide India Ltd. and Godawat Pan Masala, and the decision of the Tribunal in Jubilant Ingrevia Limited, it has to be held that reasons have to be recorded by the Central....
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.... before the Customs, Excise and Service Tax Appellate Tribunal, constitution under Section 129 of the Customs Act, 1962. In view of this, the Notification necessarily takes a quasi-judicial colour." 32. The Gujarat High Court also examined whether quasi-judicial process was involved in issuance of the notification by the Central Government and after analyzing the decision of the Supreme Court in Indian National Congress vs. Institute of Social Welfare [(2002) 5 SCC 658], the Gujarat High Court held that the notification issued by the Central Government would be quasi-judicial in nature. 33. The inevitable conclusion, therefore, that follows from the aforesaid discussion is that the decision taken by the Central Government not to impose anti-dumping duty despite a recommendation having been made by the designated authority for imposition of anti-dumping duty, cannot be sustained as it does not contain reasons nor the principles of natural justice have been compiled with. The matter, therefore, would have to be remitted to the Central Government for taking a fresh decision on the recommendation made by the designated authority for imposition of anti-dumping duty on the import o....
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....2021 and 30.08.2022 had remanded the matter to the Central Government to reconsider the recommendations made by the designated authority, but the Central Government till date has not taken a decision. It has, therefore, been stated that the Tribunal may, in the present case, examine the reasons, if any, after calling for the records of the Central Government and impose anti-dumping duty in terms of the recommendations made by the designated authority. 36. Learned counsel for the appellant submitted that if the matter is being remanded to the Central Government for reconsideration on the aspect of whether or not a definitive anti-dumping duty is to be imposed, a provisional levy in terms of section 9A(2) of the Tariff Act to the extent of duty recommended by the designated authority may, in the meantime, be imposed by the Tribunal as all the pre-requisites stand satisfied. Learned counsel also submitted that while remanding the matter to the Central Government for determination of a definitive anti-dumping duty, provisional assessment be ordered in respect of the imports of the subject goods, for the reason that if the Central Government orders a definitive anti-dumping duty to b....
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.... days prior to the notification of such provisional levy, subject to satisfaction of the conditions mentioned therein, which conditions are satisfied in the facts of the present case. 40. As the appeal itself is being decided it would not be appropriate, at this stage, to issue any direction for imposition of provisional antidumping duty. The matter is being remitted to the Central Government to take a fresh decision. It would be for appellant, if so advised, to move an application before the Central Government for imposition of provisional anti-dumping duty and there is no reason to doubt that in case such an application is filed, an appropriate order would be passed at an early date by the Central Government. It will also not be appropriate for the Tribunal, at this stage, to impose any anti-dumping duty on the basis of the final findings of the designated authority as it is the Central Government which has to take a reasoned decision in the matter one way or the other. 41. Regarding the prayer that the Central Government should submit the records/files containing reasons for not imposing anti-dumping duty, the Central Government has not taken a stand that reasons are....
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...., if, as noticed above, the respondent were to succeed in the instant writ petition. (ii) It is, however, made clear that the aforesaid direction will not create any equities in favour of the respondent. (iii) Furthermore, this direction will not have an impact on the merits of the writ petition. 9. CM No.15389/2022 is disposed of in the aforesaid terms. 10. List the matter on 02.03.2023." 44. A similar interim order was passed by the Delhi High Court in W.P(C) No. 6758/2022 on 05.09.2022 in the writ petition filed by the Union of India to assail the decision of the Tribunal rendered in Association of Synthetic Fibre Industry vs. Union of India and 4 others [Anti-Dumping Appeal No. 51049 of 2021 decided on 01.11.2021] in which a similar office memorandum was set aside. 45. Though the present appeal is being disposed of but a decision has yet to be taken by the Central Government in the light of the observations made in the order. It is, therefore, considered appropriate to pass a similar order, as was passed by the High Court, which will remain operative till a decision is taken by the Central Government on the recommendation made by the de....