By TIOL News Service

NEW DELHI, SEPT 24, 2018: THE Petitioner has challenged the legality and validity of the termination order dated 2nd September, 2017 passed by the Designated Authority under Rule 14 of the Customs Tariff (Anti Dumping) Rules, 1995 (Rules).

Rule 14 reads -

14. Termination of investigation. - The designated authority shall, by issue of a public notice, terminate an investigation immediately if -

(a) it receives a request in writing for doing so from or on behalf of the domestic industry affected, at whose instance the investigation was initiated;

(b) it is satisfied in the course of an investigation, that there is not sufficient evidence of dumping or, where applicable, injury to justify the continuation of the investigation;

(c) it determines that the margin of dumping is less than two per cent of the export price;

(d) it determines that the volume of the dumped imports, actual or potential, from a particular country accounts for less than three per cent of the imports of the like product, unless, the countries which individually account for less than three per cent of the imports of the like product, collectively account for more than seven per cent of the import of the like product; or

(e) it determines that the injury where applicable, is negligible.

On the question of alternative remedy being available, it is submitted by the petitioner that when the Designated Authority terminates the proceeding(u/r 14) or gives negative final opinion under Rule 17, or the Central Government does not issue notification under Rule 18, there is no "order of determination" and hence no appeal lies under Section 9C of the Customs Tariff Act, 1975.

Section 9C(1) of the Customs Tariff Act, 1975 (CT Act) reads -

SECTION 9C. Appeal. - (1) An appeal against the order of determination or review thereof regarding the existence, degree and effect of any subsidy or dumping in relation to import of any article shall lie to the Customs, Excise and Service Tax Appellate Tribunal constituted under section 129 of the Customs Act, 1962 (52 of 1962) (hereinafter referred to as the Appellate Tribunal).

The High Court extracted the provisions of Sections 9A and 9C of the Customs Tariff Act and Rules 3, 4, 14, 17, 18 and 23 of the Rules and inter alia observed thus -

+ The CT Act uses the expression "Central Government" and does not use the expression "Designated Authority". The term "Designated Authority" is not defined in the CT Act and not referred to in the Sections to CT Act. The expression "Designated Authority" is to be found and defined in the Rules.

+ The Designated Authority, when it performs the functions under the CT Act, it is acting for and on behalf of the Central Government and not as an independent and a distinct third party. Designated Authority is no different from the Central Government.

+ The role of the Designated Authority can, therefore, clearly be connected with the power and role of the Central Government under the main enactment i.e. CT Act read with the mandate of the Rules.

+ The right to appeal conferred should not be forfeited or abandoned unless the statute so states and can be inferred on reasonable and practical interpretation.

+ Section 9C of the CT Act in the present case has to be interpreted in a manner so as not to frustrate its purpose i.e. to provide appellate remedy both in cases of "order of determination" and review.

+ Accordingly, it will be contrary and would be against the legislative intent to hold and interpret that there is no right to appeal under Section 9C of the CT Act, when the Designated Authority does not propose imposition of anti-dumping duty.

+ As the Central Government is bound by the final finding of the Designated Authority, the final finding of the Designated Authority becomes the final finding and "order of determination" passed by the Central Government for the purpose of Section 9C of the CT Act.

+ Section 9C (should be interpreted) in a manner that it would effectuate and not frustrate the purpose of the legislation that a party should have a right of appeal against the quasi judicial determination in relation to orders determining existence, degree and effect of any subsidy or dumping of articles imported into India.

+ Section 9C does not state and provide that an appeal is maintainable against customs notification. However, it refers to and states that an appeal would lie against the "order of determination" regarding existence, degree and effect of dumping.

+ The words "existence, degree and effect of dumping" are significant. The final finding of the Designated Authority in the said aspect can be in positive i.e. when it recommends imposition of anti-dumping duty or may be in negative when it finds and holds that no anti-dumping should be imposed. Upon negative finding by the Designated Authority no further action is contemplated and required by the Central Government.

+ Contention of the petitioner that the "order of determination" would mean notification imposing anti dumping tax and not a negative final finding of the Designated Authority under Rule 17, which is not recommendatory but the final determination, is erroneous and bad in law.

+ In case of negative determination, the finding of the Designated Authority is binding, it gives no discretion to the Central Government. Thereupon, the determination becomes the determinative order in the sense that no anti-dumping duty can be imposed.

+ To say that in case of negative findings, the Designated Authority in its order of determination goes into the question of existence, degree and effect of dumping, yet no appeal would lie, would be incongruous and clearly contradictory.

[Relied upon - Mangalam Organics Limited - 2017-TIOL-187-SC-CX, National Securities Depository Limited Vs. SEBI - 2017-TIOLCORP-02-SC-CM, Automotive Tyre Manufacturers Association - 2011-TIOL-03-SC-CUS.]

The alternative submission that the impugned order suffers from jurisdictional errors and, therefore, the writ Court should exercise discretion and entertain the present petition and the petitioner should not be relegated to take recourse to alternative appellate remedy, even if available, was rejected in view of the decision in Outokumpu Oyj - 2018-TIOL-71-HC-DEL-CUS.

The High Court declined to entertain the Writ Petition and granted liberty to the petitioner to file an appeal under Section 9C of the CT Act before the CESTAT.

The petition was disposed of as not entertained.

(See 2018-TIOL-1970-HC-DEL-CUS)