TMI Blog2017 (2) TMI 1206X X X X Extracts X X X X X X X X Extracts X X X X ..... draft order would also contain conclusions on whether or not definitive measures are required to be applied. A perusal of the tabular form regarding the data which are reproduced in the disclosure statement reveals that at various places instead of the relevant data the table contains asterisks which would indicate that such information is confidential. While it is true that the such information being confidential in nature, cannot be disclosed in the disclosure statement itself, it appears to be the general practice to provide the same to the parties separately. However, in the facts of the present case, despite the fact that the information has been furnished by the domestic industry itself, the computation of the various factors referred to hereinabove, has not been furnished to the domestic industry. In the opinion of this court, it was incumbent upon the designated authority to furnish the relevant facts which have been used by it as the basis for arriving at its conclusion on the essential facts necessary for the purpose of arriving at a decision as to whether or not the definitive measures are required to be applied. Non-disclosure of the essential facts is, therefore, c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nder. - Hence, the language of the rule being mandatory, the designated authority was required to consider the existence of all the four factors. The petitioners are, therefore, wholly justified in contending that the designated authority has failed to follow the relevant statutory provisions laid down in accordance with law while issuing the disclosure statement. Determination of injury margin would come into play only in case the designated authority comes to the conclusion that determinative measures are required to be applied. Where the designated authority comes to the conclusion that no determinative measures are required to be imposed, as in the present case, the question of determining the injury margin would not arise. The NIP computed by the DA was much lower than that computed by the appellant, and the reasons for such variance and detailed calculations were not disclosed by the DA to the appellant. No good reasons were given for reducing the cost price of electricity supplied by the appellant produced in its captive power plant. This was clearly illegal. Rule 7 does not contemplate any right in the DA to claim confidentiality. Rule 7 specifically provides that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , SENIOR ADVOCATES WITH MS REENA KHAIR, MR RAJESH SHARMA AND MR GAURAV S MATHUR, ADVOCATE, FOR THE PETITIONER MR DEVANG VYAS, ASSISTANT SOLICITOR GENERAL WITH MR NIRZAR S DESAI, ADVOCATE , MR PRAMOD RAI, ADVOCATE WITH MR VISHAL SEVAK, ADVOCATE MR JITENDRA SINGH, ADVOCATE WITH MR PARITOSH R GUPTA, ADVOCATE, MR SITHARAMAN, ADVOCATE WITH MR ANAND NAINAWATI , MR VIKRAM NANKANI, SR. ADVOCATE WITH MR HARDIK P MODH, MR SANJAY NOTANI AND MR AMIT LADDHA, ADVOCATES , MR DEVANG VYAS, ASSISTANT SOLICITOR GENERAL WITH MR NIRZAR S DESAI, ADVOCATE , MR PRAMOD RAI, ADVOCATE WITH MR VISHAL SEVAK, ADVOCATE , MR SITHARAMAN, ADVOCATE WITH MR ANAND NAINAWATI , MR JITENDRA SINGH, ADVOCATE WITH MR PARITOSH R GUPTA, ADVOCATE FOR THE RESPONDENT ORAL JUDGMENT (PER : HONOURABLE MS.JUSTICE HARSHA DEVANI) 1. Since common questions of law and facts arise in all these petitions, the same were taken up for hearing together and are decided by this common judgment. 2. For the sake of convenience, reference is made to the facts as appearing in Special Civil Application No.16426 of 2016. 3. This petition has initially been filed challenging the disclosure statement dated 14.09.2016 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and injury to the domestic manufacturers including the petitioners. 6. In this background, representations came to be made on behalf of the petitioners and other industries including the Alkali Manufacturers Association of India to the designated authority for imposition of anti-dumping duty on exports of Soda Ash from the Exporting Countries. Based on the inquiry conducted by the designated authority, final findings dated 17.2.2012 (hereinafter referred to as the Final Soda Ash notification ) came to be issued, whereby Anti-Dumping Duty came to be levied on exports of Soda Ash from the Exporting Countries to India. It is the case of the petitioners that while issuing the Final Soda Ash notification, the second respondent did not consider it fit to include, inter alia, the cost towards freight incurred for Soda Ash while computing the margin of injury for deciding the quantum of anti-dumping duty, though it included the freight cost incurred on the imported product up to the Indian ports. Such non-inclusion of freight came to be challenged by the Alkali Manufacturers Association of India by way of Writ Petition (Civil) No. 4345 of 2013 before the High Court of Delhi, wherein ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the Final Soda Ash notification; b. The object of mid-term review is not to inquire whether the need for imposition of Anti-Dumping Duty exists but to determine whether the absence of its continuance would lead to injury to the domestic industry; c. Since Anti-Dumping Duty is for a period of five years unless extended, the change in circumstances ought to be construed with a view that such change is of a lasting nature and not merely a variation in the circumstances whereby the injury on account of dumping may have lessened for an intervening period; d. The designated authority ought to consider the capacity expansion being undertaken by the petitioner and other domestic producers. Details of this capacity expansion were in particular verified by the officers of Directorate General of Anti-Dumping Duty and allied duties at the time of on the spot visit to the factory of the petitioner. Non consideration of expansion being undertaken by the domestic industry would render the entire expansion of the petitioner and other domestic industry unviable; e. The cost of freight ought to have been included while calculating the margin of injury to the domestic industry. Such non ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dity of the said disclosure statements. 11. By an order dated 26.09.2016, while issuing notice in the matters, which was made returnable on 17.10.2016, in the meanwhile this court had restrained the respondent No.2- designated authority from rendering the final finding on the mid-term review undertaken pursuant to the notice dated 21.07.2015. The court had observed that it would be open for the respondents to proceed with the inquiry and investigation and it would also be open to the petitioners to place their submissions on record before the authorities so as to avoid any unnecessary wastage of time, but the final findings or any subsequent decision may not be rendered till the next date of hearing. 12. It is the case of the petitioners that vide email dated 26.09.2016 sent at 1:32 p.m., the advocate for the petitioner intimated the designated authority of the above referred order and that at that time the final findings were neither uploaded on the website of the respondents nor communicated to the petitioners or their representative. The designated authority vide email dated 26.09.2016 at 04:28 p.m. intimated that they had vide Notification No.15/28/2015-DGAD dated 23.09.2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dents had approached the Supreme Court in Petition for Special Leave to Appeal (Civil) No.2194 of 2017. By an order dated 27.01.2017, the Supreme Court had not entertained the special leave petition at that stage and had left it open to the parties to agitate all issues including the maintainability/further continuation of the writ petition in the light of the subsequent notification dated 21.12.2016. The Supreme Court had further observed that it had deemed it proper to take the above view having regard to the time frame fixed by the High Court for disposal of the writ petition i.e. on or before 15.02.2017. 14. Mr. Mihir Joshi, Senior Advocate, learned counsel with Mr. Gaurav Mathur, learned advocate for the petitioners assailed the impugned disclosure statement by submitting that in effect and substance the designated authority has finally decided the issue of continuance of anti-dumping duty and has concluded that though dumping continues and is likely to be intensified in future, there is no warrant for continuing the remedy of antidumping duty on Soda Ash since one of the parameters for determining injury, namely price undercutting is absent. According to the learned cou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s without granting adequate time to formulate the defence. It was submitted that final findings were required to be issued on or before 30.09.2016 and hence, the designated authority had in all sixteen days time to call for objections, hearing and consideration of the response of the parties. The attention of the court was invited to the post disclosure comments of the private respondents as recorded by the designated authority in the final findings, to point out that it is also the case of those respondents that no effective opportunity of hearing was given. It was urged that six days time granted by the designated authority was absolutely inadequate. Reference was made to article 6.9 of the Agreement on Implementation of Article VI of the General Agreement on Tariffs and Trade 1994 (hereinafter referred to as the Anti-Dumping Agreement ), which inter alia provides that such disclosure should take place in sufficient time for the parties to defend their interests, to point out that sufficient time is in-built in rule 16 of the rules read with article 6.9 of the Anti-Dumping Agreement. It was submitted that therefore, the time was insufficient in case of both the parties. As reg ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Organics Limited and others, 2016) 10 SCC 28. 14.5 It was contended that non-disclosure of export price, normal value and dumping margin to the extent such information is not protected under rule 7 of the rules, is clearly in breach of the principles of natural justice. Moreover, no information had been furnished by the foreign exporters, in respect of which confidentiality could have been claimed by them. The only confidential information available before the authority was furnished by the domestic industry and therefore, there is no justification for non-disclosure of the figures or the methodology adopted by the authority for determination of export price, normal value and dumping margin to the domestic industry. According to the learned counsel, the following information has wrongly not been disclosed: (i)While determining the dumping margin, the designated authority has failed to disclose the basis for determining normal value and export price. The designated authority has not disclosed the computation and methodology; (ii) While determining the price suppression and depression effect, the designated authority has considered the value for cost of sales and selling pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd the petitioners had no effective opportunity to displace the conclusions arrived at in the disclosure statement. 14.6 The next submission advanced by the learned counsel for the petitioners was that the review investigation is not in consonance with the principles enunciated by the Supreme Court in the case of Rishiroop Polymers (P) Ltd. v. Designated Authority and Additional Secretary, (2006) 4 SCC 303, wherein it has been held that the mid-term review is limited to the information received with respect to the change in the various parameters, and the entire purpose of the review inquiry is not to see whether there is a need for imposition of anti-dumping duty but to see whether in the absence of such continuance, dumping would increase or recur and the domestic industry suffers. It was submitted that the designated authority has failed to confine the investigation to the grounds for seeking review in the initiation notification and has also not applied correct tests for ascertaining the likelihood. It was contended that the designated authority has put the onus on the petitioners to show that there is need for continuation of duty, whereas it was for the applicant importers ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ority, it was submitted that in the final findings reliance has been placed on the data obtained from the World Trade Atlas (WTA), whereas there is no mention of this data in the disclosure statement. It was submitted that neither the data nor the non-confidential summary of such data, has been given in the disclosure statement and hence, the petitioners had had no opportunity to offer their comments on the WTA data, which is clearly in breach of the principles of natural justice. It was contended that the designated authority has not examined the relevant parameters relating to likelihood of injury and that the disclosure statement refers to para (vii) of Annexure-II to the rules as the basis for the likelihood test. Referring to the findings recorded in the disclosure statement, it was pointed out that criteria (i) and (iii) postulated in para (vii) are admittedly met with in the facts of the present case, which is sufficient to continue the duty, whereas there is no analysis as regards criteria (ii) and (iv) in the final findings. It was contended that even if one of the parameters indicates likelihood of injury, the duty is to be continued and in fact, it is for the applicant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ar, Senior Advocate, learned counsel with Ms. Reena Khair, learned advocate for the petitioners has adopted the submissions advanced by Mr. Mihir Joshi. The learned counsel further invited the attention of the court to the communication dated 19th September, 2016 of GHCL Limited whereby it had sought two weeks additional time to submit its comments, to submit that initially a joint reply was filed by the domestic industries thereafter one industry had addressed the above letter. Reference was made to the methodology for determination of non-injurious price, Annexure IV to the disclosure statement to point out that the same does not contain any figures. It was submitted that the designated authority has not taken the figures given by the domestic industry at face value and has made adjustments. The designated authority has adopted figures according to what it perceived to be correct and has worked out the non-injurious price, under the circumstances, the breakup of the NIP calculation ought to have been given. Reference was made to the decision of the Supreme Court in Reliance Industries Ltd. V. Designated Authority, 2006 (202) ELT 23 (SC), for the proposition that the purpose of s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has to be shared with the them. It was argued that non supply of computation of NIP is clearly in breach of the principles of natural justice as there was an obligation on the designated authority to share the information with the petitioners. 16. Vehemently opposing the petitions, Mr. S. Sitharaman, learned counsel with Mr. Anand Nainavati, learned advocate for the fourth respondent - Detergent Manufacturers Association of India, submitted that the scope of disclosure statement issued under rule 16 of the rules corresponds to article 6.9 of the WTO Anti-Dumping Agreement (ADA). It was pointed out that the first sentence of article 6.9 of the ADA states that: The authorities shall, before a final determination is made, inform all interested parties of the essential facts under consideration which form the basis for the decision whether to apply definitive measures . It was pointed out that this sentence has been interpreted by a Panel of the WTO Dispute Settlement Body (DSB) in case of China - Countervailing and Anti-dumping duties on Grain Oriented Flat Rolled Electrical Steel from United States (WT/DS/414/R) to mean that in order to apply definitive measures at the conclusion ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... conclusions on all pertinent issues in various parts of the disclosure statement. Therefore, the disclosure of certain conclusions in the disclosure statement cannot be faulted. 16.2 Dealing with the contention raised on behalf of the petitioners that effective opportunity to displace the conclusions arrived at in the disclosure statement was not granted on the grounds that the designated authority had prejudged the issue; sufficient time was not granted for filing comments; no extension of time for filing comments and no hearing was granted after disclosure; it was submitted that insofar as pre-judging the issue is concerned, all the disclosures made in the said statement should be read and understood in the light of paragraph-3 of the letter forwarding the disclosure, wherein it has been stated that, Notwithstanding the facts given in this Disclosure Statement (including facts given on a confidential basis), the Designated Authority would consider all replies given, on merits, in order to arrive at a final determination. It was submitted that the designated authority has reiterated the same once again at the end of the disclosure statement wherein it has been stated that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... left to the discretion of the authority and the fact that the authority did not grant extension cannot not be a ground for faulting the entire process. It was submitted that in any case, as far as the fourth respondent is aware, no differential time limit was set for different interested parties and all interested parties were treated alike, that is, they were granted the same length of time for filing comments. 16.5 The learned advocate further drew the attention of the court to the fact that in the original investigation, the disclosure statement was issued on 10th February, 2012, whereas the final findings were issued on 17th February, 2012, to submit that the time limit for comments on disclosure given during the original investigation must have been less than the time given in the current mid-term review. 16.6 As regards the contention that insufficient and inadequate time had been granted for the purpose of defending the interests of the petitioners, reference was made to rule 6(7) of the rules, which corresponds to article 6.4 of the ADA, to submit that the same provides that the authorities shall, whenever practicable, provide timely opportunities for all interested p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erial injury to any established industry in India or materially retards the establishment of any industry in India. These are commonly referred to as material injury, threat of material injury and material retardation. In the original investigation the designated authority determined that the domestic industry had suffered material injury. According to the learned counsel, when an industry has suffered material injury and antidumping duties have been imposed to remedy such material injury, while reviewing such measures, the designated authority is required to consider whether the said material injury is likely to continue or recur. It was contended that the question of continuation will arise when the domestic industry is still suffering material injury, however, when the industry is not suffering material injury currently, one must examine whether the injury is likely to recur, if the duties are withdrawn. 16.9 It was submitted that in this case, as the domestic industry was not suffering any material injury, it was incumbent upon the designated authority to consider whether it is likely to recur. It was submitted that there is no guidance in the law either in the anti-dumping ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... third sentence of Article 3.7 of ADA states: . In making a determination regarding the existence of a threat of material injury, the authorities should consider, inter alia, such factors as . This sentence uses the word should and not shall . Thus, the factors mentioned in respect of threat of material injury are not mandatory. It was urged that therefore, the question of the authority failing to consider some of the factors mentioned would not amount to a violation of the principles of natural justice that would vitiate the final findings, much less, the disclosure statement. 16.12 It was further submitted that the designated authority has, in its wisdom, considered a number of other factors such as volume of exports post POI, market share of subject countries in the Indian market, price attractiveness of Indian market, export orientation of foreign producers, level of current and past dumping margin, etc., in the likelihood analysis. According to the learned counsel, if at all, such issue may be agitated in an appeal before the appellate authority and not before the High Court while invoking its writ jurisdiction. 16.13 On the question of use of Non-Injurious Price i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd up, from 100 to 108 to 113 to 123 to 125 over the injury period and that NIP has not been used in this analysis. It was further pointed out that for price suppression, the trend of cost of sales and selling price have been used and that in this case, while cost of sales has increased from 100 to 101 to 110 to 106 and then to 102, selling prices kept on increasing as stated earlier. Thus, NIP has not been used for this analysis also. 16.15 The learned counsel further submitted that while examining the third aspect, that is, mandatory injury parameters, the designated authority has only examined the relevant parameters such as production, capacity, sales, capacity utilisation, inventories, etc., and that NIP has not been used at all. It was submitted that in fact, the factor relating to profits requires special attention in this regard. It was pointed out that the designated authority examines the actual profit earned by the domestic industry. In indexed terms, profit per MT has increased from ₹ 100 in 2011-12 to ₹ 176 in 2012-13, it has declined marginally to ₹ 146 in 2013-14 and has then increased to ₹ 293 during POI and has further increased to ₹ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e, thou shall not hit another. It was submitted that to determine the amount of duty that would aim to protect the interests of both the parties, the injury margin is determined and the duty equal to the dumping margin or the injury margin, whichever is less, is fixed. It was submitted that it is necessary to look at the distinction between price undercutting and price underselling. As price undercutting indicates the difference between the Net Sales Realisation of the domestic industry and the landed value of imports, it indicates the extent to which import prices are affecting the domestic industry. On the other hand, price underselling is the parameter to see whether the imports are coming even below the NIP. 16.17 Reverting to the facts of the present case it was submitted that price undercutting was 5%-10 % during the POI and 0%-5% during the Post POI. During the POI, landed values of imports coming into India were in the range of USD 253.18 PMT to USD 308.52 PMT. At this landed value, they were below the Net Sales realisation of the domestic industry in the range of 5%-10%. Weighted average landed value of imports from all the countries was ₹ 16820 PMT (or USD 272.65 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erial injury notes that the performance of the domestic industry has improved remarkably in terms of production, sales volume, profit, cash profit, return on capital employed and inventory; it records that market share has declined during POI as compared to base year; it goes on to add that during the post POI, the economic parameters have shown continued improvement including increased trend in the market share; it does state that net sales realisation is more than the landed price from the subject countries during the POI and the post POI; and that it is partially correct in the sense that the NSR was more than the landed price of imports from Pakistan only during POI and NSR was more than the landed price of imports from both Pakistan and EU during post POI and not from all the subject countries. It was submitted that apart from this one error, the petitioners have not pointed out any other errors. 16.20 The learned counsel for the fourth respondent further submitted that while evaluating the impact of this error which may be a ministerial error, conclusions on other factors shall also have to be kept in mind. Referring to the disclosure statement it was pointed out that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... contended that this is nothing but an attempt on the part of the petitioners to somehow inflate the NIP and to arrive at a low or nil injury margin to suit their purposes. 16.23 Dealing with the contention of the petitioners that the action of the designated authority in initiating the midterm review is without jurisdiction and illegal and that the initiation notice does not record any finding as to the existence of facts warranting such review, the learned counsel submitted that this is factually incorrect. It was submitted that the grounds for review submitted by the applicant, that is, the All India Glass Manufacturers Federation and the decision of the authority on the said grounds are given in the initiation notice itself. The attention of the court was invited to paragraphs 2, 3, 10 and 11 of the initiation notice to submit that in view thereof, there is no merit in the contentions raised by the petitioners. 16.24 As regards the contention of the petitioners that the WTA data used by the designated authority in the final findings had not been disclosed to them, the learned counsel submitted that when certain issues are raised by an interested party as a part of the com ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he injury analysis (3) Non-disclosure of calculation of NIP for POI; (4) Non-disclosure of NIP as such and its calculation for post POI; 16.27 Lastly it was submitted that when the petition was filed and initially taken up for consideration, the customs notification had not been issued. Accordingly, at that point of time, there was no alternate remedy available. However, now that the determination has been by the Central Government by issuing the customs notification withdrawing the duty, a statutory alternate remedy is available and therefore, the petitioners should be directed to exhaust the alternate remedy and that for this reason also, these writ petitions deserve to be dismissed. It was also submitted that anti-dumping duty being an economic measure, as has been held by this court in the case of Alembic Ltd, 2013 (291) ELT 327 (Guj), the petition may not be entertained. 17. Mr. Vikram Nankani, Senior Advocate, learned counsel with Mr. Hardik Modh, learned advocate for the seventh respondent submitted that in a matter of this kind, the scope of judicial review is very narrow and confined only to the decision making process and not to the decision itself. It was sub ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... w and for that, recourse has to be made to the scheme of the Act and the rules. It was submitted that the court would see that no prejudice is caused to the party by the authority in following due process; however, insofar as the sufficiency and adequacy of the findings recorded by the authority is concerned, the same would come at the final stage. It was submitted that by virtue of a disclosure statement under rule 16 of the rules, only information of the essential facts is required to be given to the parties and that no lis is decided and that the designated authority only discloses the essential facts under consideration which formed the basis of its decision. It was urged that the disclosure statement is, therefore, only a intermediary stage of the decision-making process and hence, at this stage, there would be no warrant for exercise of powers of judicial review. Reference was made to the decision of the Supreme Court in the case of Union of India and another v. Meghmani Organics Limited and others, (supra) and more particularly, paragraph-5 thereof, wherein the court has recorded that the appellate authority, namely, CEGAT will always have the power to look into the relevant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... excludes the application of any or all the principles of natural justice then the court cannot ignore the mandate of the Legislature or the statutory authority and read into the concerned provision the principles of natural justice. Whether the exercise of a power conferred should be made in accordance with any of the principles of natural justice or not depends upon the express words of the provision conferring the power, the nature of the power conferred, the purpose for which it is conferred and the effect of the exercise of that power. 17.4 Reliance was also placed upon the decision of the Supreme Court in the case of Union of India and others v. Sanjay Jethi and another, (2013) 16 SCC 116, for the proposition that natural justice cannot be permitted to become an unruly horse. Reference was also made to the decision of the Supreme Court in the case of Vardhman Industries Limited v. Commissioner of Central Excise, Chandigarh, (2015) 13 SCC 400, wherein it was held that an order which does not give rise to any legal rights, cannot be a subject matter of challenge under Article 226 of the Constitution of India. Reference was also made to the decision of the Supreme Court in t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e circumstances are duly disclosed in Annexure IV to the disclosure statement. It was submitted that in any case, all the contentions raised before this court are contentions which could be raised before the Tribunal and hence, the petitioners ought to be remanded before the Tribunal where they may raise all such contentions. 17.8 Mr. Nankani submitted that keeping in mind the nature of the information disclosed under rule 16 of the rules, it is apparent that it is only a step in the investigation process, and hence, judicial review is not warranted at this stage as it cannot be said that there is any breach of the principles of natural justice, as reasonable and adequate opportunity has been granted to the petitioners. It was submitted that in these circumstances, the petitioners should not be permitted to take recourse to Article 226 of the Constitution of India. 17.9 Insofar as the submission with regard to necessity of granting sufficient time for the purpose of giving a response to the disclosure statement based on Article 6.9 of the ADA is concerned, the learned counsel submitted that the words such disclosure should take place in sufficient time for the purpose to def ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nternational treaty. It was, accordingly, urged that the petitioners have an efficacious alternative statutory remedy available by way of an appeal under section 9C of the Act, and in the absence of any breach of the principles of natural justice or lack of jurisdiction on the part of the designated authority, the petition deserves to be dismissed on this count alone. 18 Mr. Pramod Kumar Rai, learned advocate with Mr. Vishal Sevak, learned advocate for the third respondent, submitted that the disclosure statement dated 10.08.2012 issued through the original investigation based on which the duty was imposed in 2012 shows that the time for submitting comments to the disclosure statement was shorter as compared to the time given in response to the impugned disclosure dated 14.09.2016. The earlier disclosure dated 10.8.2012, if not more, is equally conclusive and suggestive of imposition of anti-dumping duty because in para 147 of the disclosure statement it is stated that there is dumping, there is injury to Domestic Industry and injury is caused by dumping. Dumping Margin and Injury Margin is also shown to be positive in the earlier paragraphs. It was submitted that with these obs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r represented in its individual capacity and all the submissions had been made as part of Alkali Manufacturers Association (Domestic Industry) through their counsel. It was contended that now by filing a one-page letter post disclosure, the petitioners are seeking the indulgence of this court just with a view to delay the withdrawal of duty and to derive an undue advantage for which they have no locus standi. It was pointed out that even in the affidavit filed on 8.2.2017 the petitioner has not referred to any document submitted by them. 18.4 The learned counsel further submitted that the association of the domestic industry had represented its case before designated authority and has challenged the disclosure statement before the Delhi High Court in WP no. 8514 8628 of 2016, which came to be withdrawn subsequently on 27.9.2016. It was submitted that the association of the domestic industry has also filed its comments on the disclosure statement which has been taken on record and has been duly considered by designated authority; however, the association of the domestic industry is not before the court and the petitioner does not derive a locus standi in the case by filing a on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oduce more. It was submitted that whatever the petitioners are able to produce, they are able to sell and that there is no injury on price front also because dumped imports have not forced them to reduce prices. It was submitted that the petitioners have continued to increase the price much more as compared to the increase in cost of sales resulting into exponential growth in their profits. 18.9 It was next contended that the petitioners are simply trying to block the imports from all significant producers of Soda Ash overseas. In this regard reference was made to the list of countries in the two impugned notifications, to point out that EU itself has got so many countries. It was emphatically argued that the case of the petitioners is that India should not allow any import at a price lower than their selling price, even though they fix a very high selling price arbitrarily, which cannot be allowed because in an open market economy, the respondents have right to procure raw materials from competitive sources. 18.10 The learned counsel further submitted that all the asterisk marks in the disclosure are actually attributable to claim of confidentiality with respect to net sale ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... authorities from proceeding expeditiously. It was submitted that, therefore, where the designated authority has tried to complete the proceeding within time, it should not be interfered with on the ground of insufficient time, more so, when the association of petitioners has actually submitted its response within the time given. 18.13 Lastly, it was submitted that it was the association of the domestic industry which requested for an analysis of likelihood of injury based on third country export data which has been taken from World Trade Atlas (WTA) and it is disclosed in final findings and it is the NIP and injury margin calculation which has been treated as confidential because domestic industry has claimed confidentiality in those calculations. The discussion in paragraphs 99 and 100 of the final findings supports the analysis done in the disclosure statement and thus the final findings cannot be faulted with on this ground. It was contended that if at all, the petitioners find this analysis to be faulty, the proper remedy is by way of an appeal before CESTAT under section 9C of the Customs Tariff Act, 1975, where the reasoning adopted in final findings can be assailed. 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nce in the factual matrix of the present case. Reference was made to the findings recorded by the designated authority in the final findings to point out that various parameters have been considered by it to come to the conclusion that if anti-dumping duties imposed on the imports of subject goods originating in or exported from the subject countries are removed, the injury to the domestic industry is not likely to recur. 19.3 Next, it was submitted that the WTA data relied upon to examine specific claims of the parties as a matter of practice is not disclosed in any of the cases and the designated authority gets information from WTA under an agreement and the same is not freely published. It was submitted that the issue of nondisclosure of WTA data is without merit since the petitioners could not establish how the injuries would have recurred if the duties were removed when the domestic industry had been showing remarkable performance in terms of various injury parameters. 19.4 Insofar as the contention that the time that was granted from the date of issuance of disclosure statement to the date for filing the comments on the disclosure being very short is concerned, it was s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... been duly considered by it. Reliance was placed upon the decision of the Supreme Court in the case of Rishiroop Polymers (P) Ltd. v. Designated Authority and Additional Secretary, (2006) 4 SCC 303, to submit that the scope of a mid-term review is limited to examining whether the conditions existing at the time of imposition of anti-dumping duty had altered to an extent rendering the continued imposition of duty, unjustified. Moreover, the said inquiry is limited to the information received with respect to the changes in various parameters in para (iv) of Annexure-II to the rules. The purpose of the review is not to ascertain the need for imposition of antidumping duty, but to ascertain the facts and discontinue such duty. Reliance was also placed upon the decision of the Supreme Court in the case of Designated Authority v. Haldor Topsoe A/S. (supra) and more particularly, paragraph- 19 thereof. It was submitted that whether to extend the time or not is an administrative decision of the designated authority and he may exercise his prudence. It was submitted that the principles of natural justice have been duly complied with and the procedure has been followed and all information and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cessation of such duty is likely to lead to continuance or recurrence of dumping and injury. It was submitted that if there is a finding that there is injury, what is required to be examined is whether it is likely to continue but if there is no injury, then the question as to whether the injury is likely to recur is required to be examined. It was submitted that essential facts are those facts on the basis of which the designated authority can decide whether there is any injury and whether there is likelihood of continuance or recurrence thereof. 21.1 Reference to the report of the Appellate Body of the World Trade Organization in WT/DS454/AB/R, WT/DS460/AB/R dated 14th October, 2015 in China-Measures Imposing Anti- Dumping Duties on High-Performance Stainless Steel Seamless Tubes ( HP-SSST ) from Japan and China-Measures Imposing Anti-Dumping Duties on High-Performance Stainless Steel Seamless Tubes ( HP-SSST ) from the European Union (para 5.133), to point out that in the facts of the said case the WTO Panel had considered that a determination of whether an investigating authority has complied with its obligations under that provision hinges largely on whether the essential f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he mid-term review was issued on 21.07.2015, therefore, the period of one year would come to an end on 20.07.2016. The designated authority made an application for extension of such period as late as on 27.06.2016, that is, three weeks before the expiry of the period of one year when he was still at the stage of rule 16 of the rules, viz., at the stage of issuance of disclosure statement, whereby he sought an extension of two months. Thereafter also, he took his own time in issuing the disclosure statement as late as on 14.09.2016, leaving a period of only fourteen to sixteen days for issuance of the final findings. It was submitted that the designated authority has thus, created an artificial urgency by seeking a shorter extension in one case and no extension in the other case to deny the petitioners sufficient opportunity. It was submitted that the conduct of the authority is contrary to the purpose of the rules, inasmuch as nothing stopped the designated authority from seeking an extension in the second case also. It urged that breach of principles of natural justice is essentially considered as an exception to appellate remedies, which goes to the root of the matter and makes i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... art of the para records the conclusions of the designated authority but there is nothing to show as to what are the essential facts, to submit that the opinion of the designated authority is not an essential fact. It was submitted that apart from the above, the designated authority has relied upon the non-injurious price for the purpose of drawing this conclusion. It was contended that it is not possible for the petitioners to defend its interest against a conclusion and that the disclosure statement does not set out essential facts as contemplated under rule 16 of the rules and hence, fails on this count. 21.6 Referring to the total demand of soda ash in India and the surplus in China PR and USA, it was pointed out that both the countries have huge surplus of soda ash. It was further submitted that the volume of export to third countries has not been considered by the designated authority; who has also failed to consider the aspect of freight as well as capacity expansion of domestic industries which in fact was placed before it. 21.7 It was further submitted that the likelihood analysis made by the designated authority is based on the current NIP. It was pointed out that th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... establish that if the duties were removed, the injury would not recur. It was submitted that the designated authority has applied wrong principles in the proceedings. 21.11 As regards the contention that the petitions were not maintainable on the ground that there is an efficacious alternative remedy available under the statute, Mr. Joshi submitted that the proceedings before the designated authority are quasi-judicial in nature and that in case there is a breach of the principles of natural justice, a writ petition would lie before this court. In support of such submission, reliance was placed upon the decisions of the Supreme Court in Popcorn Entertainment and another v. City Industrial Development Corporation and another, (2007) 9 SCC 593 (paragraph 20), and Automotive Tyre Manufacturers Association v. Designated Authority and others, (2011) 2 SCC 258, (paragraphs 64 to 75). 22. In the backdrop of the facts and contentions noted hereinabove, reference may be made to the relevant provisions of the Customs Tariff Act, 1975 (hereinafter referred to as the Act ). Section 9A of the Act provides for Antidumping duty on dumped articles and lays down that where any article is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e with the rules made under sub-section (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 transshipped 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. 23. Sub-section (5) of section 9A of the Act provides that the anti-dumping duty imposed under that section shall, unless revoked earlier, cease to have effect on the expiry of five years from the date of such imposition. The proviso thereto says 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. 24. Section 9B of the Act, to the extent the same is relevant for the present purpose, reads thus: 9B. No levy under section 9 or section 9A in certain cases. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the rules, in pursuance whereof, a mid-term review came to be initiated by a notification dated 21.07.2015. A public hearing came to be held on 09.03.2016. The petitioners and other members constituting the domestic industry filed written submissions before the designated authority opposing the mid-term review. It appears that the applicants at whose instance the mid-term review came to be initiated also filed their written submissions and the process as contemplated under the rules came to be followed. In terms of sub-rule (2) of rule 23 of the rules, any review initiated under sub-rule (1) thereof shall be concluded within a period not exceeding twelve months from the date of initiation of such review. Therefore, the review was required to be completed on 02.07.2016. The proviso to rule 17 of the rules provides that the Central Government may, in its discretion in special circumstances extend the period of one year by six months. On 27.06.2016, the designated authority sought extension of time under the proviso to rule 17 of the rules read with subrule (3) of rule 23 of the rules. 27. By an order dated 15.07.2016, the Central Government extended the time to 30.09.2016. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sidering the parameters set out in Annexure II to the rules and more particularly, clause (vii) thereof, whereas the designated authority has failed to consider the relevant factors; it is also the case of the petitioners that the designated authority has based its conclusions on incorrect facts and irrelevant factors, which goes to the root of the matter and vitiates the disclosure statement. 29. Each of the above contentions assailing the validity of the disclosure statements may be tested independently. 30. Insofar as the breach of principles of natural justice is concerned, since such breach has been alleged on various grounds, the same is not being dealt with separately, but shall be considered together with each such ground. 31. While considering the first contention regarding the designated authority having failed to disclose the essential facts as contemplated under rule 16 of the rules, before embarking upon a discussion as to whether there is any failure to disclose essential facts, it would first be necessary to understand the meaning of the expression essential facts as appearing in rule 16 of the rules. Rule 16 of the rules, which deals with disclosure state ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... circumstances as distinct from their legal interpretation and expressed the view that essential facts to be disclosed under Article 6.9 may qualify under any of these meanings of the word fact. The purpose of disclosure under Article 6.9 is to provide the interested parties with the necessary information to enable them to comment on the completeness and correctness of the facts being considered by the investigating authority, provide additional information or correct perceived errors, and comment on or make arguments as to the proper interpretation of those facts. Article 6.9 requires disclosure of essential facts that are under consideration and which form the basis for the decision whether to apply definitive measures . This requirement is not necessarily satisfied by the disclosure of the investigating authorities conclusions on issues of fact that must be resolved before a decision to apply definitive measures is taken. The Panel considered that essential facts under consideration which form the basis of the decision whether to apply definitive measures are the body of facts essential to the determinations that must be made by the investigating authority before it can ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the final findings, viz., whether or not on the basis of such facts definitive measures are required to be applied. The contention that the disclosure statement is in the nature of a draft order, therefore, does not merit acceptance, inasmuch as, a draft order would also contain conclusions on whether or not definitive measures are required to be applied. 32. The next question that arises for consideration is whether or not the essential facts have been disclosed in the disclosure statement. 32.1 Before examining this issue, it may be germane to refer to the findings recorded by the designated authority in the disclosure statement to ascertain the factors taken into consideration and the facts disclosed in respect thereof. It may be noted that the findings recorded by the designated authority in the disclosure statements in both the reviews in question are almost identical and hence, for the sake of convenience and with a view to avoid prolix, reference is made to the findings recorded in the disclosure statement in the review relating to imports from China PR, EU, Kenya, Iran, Pakistan, USA and Ukraine. 32.2 The designated authority has, in the disclosure statement, d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ffects of dumped imports, the designated authority has noted that from the subject countries, imports have increased in absolute terms from 3,29,828 MT in the base year to 6,73,706 MT in the POI in consonance with the increasing demand in India. Imports from subject countries has shown further increasing trend during post POI as well. 32.6 Insofar as the price effect of dumped imports on the domestic industry is concerned, the designated authority has examined the impact on the prices of the domestic industry on account of the dumped imports from the subject countries with reference to price undercutting, price underselling, price suppression and price depression. For the purpose of this analysis, the designated authority has compared the cost of production, net sales realisation (NSR) and the non-injurious price (NIP) of the domestic industry with the landed cost of imports from the subject countries. As regards the price suppression and price depression effect of the dumped imports, the designated authority has examined the same with reference to cost of production, net sales realisation and landed values of the subject goods from the subject countries in relation to the injur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... st and cash profit has remarkably increased in the POI as compared to base year. In respect of the employment, wages and productivity, the designated authority has noted that there was a marginal increase in the number of employees as well as productivity during the POI and post POI as compared to the base year. But, wages have increased significantly during the POI as well as post POI as compared to the base year. 32.8 As regards the magnitude of dumping, the designated authority has observed that dumping margins in respect of import of the subject goods from the subject countries are positive and substantial during the POI. The designated authority has noted that the growth of the domestic industry was positive during POI as well as post POI. As regards ability to raise funds, the designated authority has noted that the domestic industry has not enhanced its capacity of production of the subject goods from the base year, which according to it signifies that their ability to raise capital investment has not been affected. The designated authority has worked out the magnitude of injury and injury margin and has noted that the injury margin is negative in respect of the subject coun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he parameters relating to the threat of material injury in terms of Annexure II (vii) of the Rules, which states as under: A determination of a threat of material injury shall be based on facts and not merely on allegation, conjecture or remote possibility. The change in circumstances, which would create a situation in which the dumping would cause injury, must be clearly foreseen and imminent. In making a determination regarding the existence of a threat of material injury, the Designated Authority shall consider, inter alia, such factors and; a. a significant rate of increase of dumped imports into India indicating the likelihood of substantially increased importation. b. Sufficient freely disposable or an imminent, substantial increase in capacity of the exporter indicating the likelihood of substantially increased dumped exports to Indian market, taking into account the availability of other export markets to absorb any additional exports. c. Whether imports are entering at prices that will have a significant depressing or suppressing effect on domestic prices, and would likely to increase demand for further imports and, d. Inventories of the article being inve ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eak domestic industry in India. Although there is high demand for the subject goods in India, the prices prevailing in Indian market and the strong domestic industry base may not be conducive for the subject countries to target Indian market in the event of revocation of the duties. Level of current and past dumping margin 58. The Authority notes that during the POI, the dumping margin in the original investigation as well as the present MTR are positive. In the post POI, the dumping margin in respect of the cooperative exporters of Turkey is negative, but the country as a whole, it is positive. In case of Russia, the dumping margin is positive both during the POI as well as post POI. But, dumping of any magnitude has no relevance under the Indian anti-dumping law as long as it does not cause injury to the domestic industry. In the present investigation, injury margin is negative in the POI as well as post POI periods, thereby indicating no injury to the domestic industry and no likelihood of injury as well in the event of revocation of the duties. 59. The essential facts of the investigation, as analysed by the Authority in this finding, sufficiently prove that the des ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt for the purpose of coming to the conclusion as to whether or not definitive measures are required to be applied, it has placed reliance on certain information for the purpose of arriving at its findings which are essential facts. All the information which are relied upon by the designated authority to the extent the same is not protected by rule 7 of the rules, was in the nature of necessary information which should have been disclosed to the interested parties to enable them to comment on the completeness and correctness of the facts that were being considered by the designated authority, and to provide additional information or correct the perceived errors and comment on or make arguments as to the proper interpretation of those facts. The entire body of facts essential to the determinations that must be made by the designated authority before it can decide whether to apply definitive measures are required to be disclosed to the interested parties. A perusal of the tabular form regarding the data which are reproduced in the disclosure statement reveals that at various places instead of the relevant data the table contains asterisks which would indicate that such information is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nciples governing investigations. Rule 7 of the rules bears the heading Confidential information and lays down that notwithstanding anything contained in sub-rules (2), (3) and (7) of rule 6, subrule (2) of rule 12, sub-rule (4) of rule 15 and sub-rule (4) of rule 17, the copies of applications received under sub-rule (1) of rule 5, or any other information provided to the designated authority on a confidential basis by any party in the course of investigation, shall, upon the designated authority being satisfied as to its confidentiality, be treated as such by it and no such information shall be disclosed to any other party without specific authorization of the party providing such information. 33.3 Rule 10 of the rules provides for determination of normal value, export price and margin of dumping, and postulates that an article shall be considered as being dumped if it is exported from a country or territory to India at a price less than its normal value and in such circumstances, the designated authority shall determine the normal value, export price and the margin of dumping taking into account, inter alia, the principles laid down in Annexure I to the rules. Rule 11 of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... her there has been a significant price undercutting by the dumped articles as compared to the price of like product in India, or whether the effect of such imports is otherwise to depress prices to a significant degree or prevent price increase which otherwise would have occurred, to a significant degree. (iii) Xxxx (iv) The examination of impact of the dumped imports on the domestic industry concerned, shall include (i) an evaluation of all relevant economic factors and indices having a bearing on the state of the industry, including natural and potential decline in sales, profits, output, market share, productivity, return of investments or utilization of capacity; factors affecting domestic prices; the magnitude of the margin of dumping; actual and potential negative effects on cash flow, inventories, employment, wages, growth, ability to raise capital investments. (v) Xxxx (vi) xxxx (vii) A determination of threat of material injury shall be based on facts and not merely on allegation, conjecture or remote possibility. The change in circumstances which would create a situation in which the dumping would cause injury must be clearly foreseen and imminent. In makin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ubject countries in the Indian market has significantly increased during POI and has further improved during post POI, whereas market share of domestic industry has marginally declined during POI but shown a positive trend during post POI. Since market share of the domestic industry has remained more or less the same, their market share has not been impacted by the imports from the subject countries. (iii) Price attractiveness of the Indian market: For this purpose, the designated authority has relied upon the NIP and has noted that both price undercutting and price underselling are negative during POI as well as post POI. (iv) Export orientation of foreign producers. Even if the subject countries are export oriented, that by itself cannot be a strong likelihood factor unless backed by favourable market conditions and weak domestic industry in India. Although there is a high demand for the subject goods in India, the prices prevailing in the Indian market and the strong domestic industry base may not be conducive for the subject countries to target Indian market in the event of revocation of the duties. (v) Level of current and past dumping margin: The designated has, int ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sal of the disclosure statement shows that while the designated authority has taken into consideration the above two factors, it is manifest that while doing so, it has taken into consideration incorrect facts, inasmuch as, instead of considering the capacity of production of the exporters indicating the likelihood of substantially increased dumped exports to Indian markets, as contemplated under sub-clause (b), it has taken into consideration the capacity of production of the domestic industry; and instead of taking into consideration the existence of inventories of the dumped imports that could meet any increase or future demand for the imports, has taken into consideration the inventories of the domestic industry. Evidently therefore, the designated authority has failed to follow the procedure laid down under clause (vii) of Annexure-II to the rules for the purpose of determination of threat of material injury in the manner prescribed thereunder. 33.9 On behalf of the respondents it has been contended that the factors mentioned for a threat of material injury determination are not mandatory for a likelihood of recurrence of injury analysis. That the designated authority in it ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment during post POI period do not exhibit any material injury. It may therefore be apposite to refer to the meaning of the above terms. Price undercutting is stated to be the difference between sales realisation of the domestic industry at factory gate net of taxes and landed value of imports. If the sales realisation is more than the landed price the same indicates positive price undercutting and if the sales realisation is less than the landed price, the same indicates negative price undercutting. In the present case, the designated authority has recorded that the sales realisation is more than the landed price, which itself is a pointer to the fact that the price undercutting is positive, and while recording the essential facts the designated authority has accordingly, come to the conclusion that price undercutting is positive. However, the designated authority while coming to the conclusion that there is no material injury has taken into consideration incorrect facts, viz. that the price undercutting is negative. Insofar as injury margin and price underselling are concerned, both are based upon the non-injurious price. The difference between non-injurious price and landed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o disclose the essential facts under consideration which form the basis for its decision whether or not to apply determinative measure, determination of non-injurious price is irrelevant, as the same has no relevance so far as determination of injury is concerned. While the designated authority may compute the non-injurious price for the purpose of giving the parties an opportunity to make their comments in respect of such computation at the stage of disclosure statement, however, such non-injurious price cannot be taken into consideration for the purpose of determination of injury. Non-injurious price having no relevance insofar as determination of injury is concerned, would not form an essential fact for the purpose of arriving at a decision as to whether or not determinative measures are required to be applied. It is only after coming to the conclusion that there is injury necessitating imposition of or continuance of anti-dumping duty, that the designated authority is required to determine the injury margin, for which purpose it has to determine the non-injurious price as per the principles laid down in Annexure III to the rules for the purpose of fixing the quantum of anti-dum ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 39. We do not agree with the Tribunal that the notification of the Central Government under Section 9A is a legislative Act. In our opinion, it is clearly quasijudicial. The proceedings before the DA is to determine the lis between the domestic industry on the one hand and the importer of foreign goods from the foreign supplier on the other. The determination of the recommendation of the DA and the Government notification on its basis is subject to an appeal before the CESTAT. This also makes it clear that the proceedings before the DA are quasi- judicial. 40. In the present case, the NIP computed by the DA was much lower than that computed by the appellant, and the reasons for such variance and detailed calculations were not disclosed by the DA to the appellant. No good reasons were given for reducing the cost price of electricity supplied by the appellant produced in its captive power plant. This was clearly illegal. 41. The DA claimed confidentiality from the appellant about its finding on the data supplied by the appellant itself. In our opinion, there was nothing confidential in the matter, and hence reasons for not accepting the appellant's version should have be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of initiation of investigation. Accordingly, the final findings were required to be submitted to the Central Government on or before 02.07.2016. However, the proviso to rule 17 (1) of the rules provides that the Central Government may, in its discretion in special circumstances extend the period of one year by six months. On 27.06.2016, the designated authority sought extension of time under the proviso to rule 17 of the rules read with sub-rule (3) of rule 23 of the rules and by an order dated 15.07.2016, the Central Government extended the time to 30.09.2016. The designated authority issued the disclosure statement under rule 16 of the rules on 14.09.2016 and the parties were told to offer their comments by 20.09.2016, that is, within a period of six days and the final findings were required to be issued on or before 30.09.2016. The petitioners submitted their response dated 11.9.2016 by a letter dated 14.9.2016 and requested for more time. However, such request was not acceded to and the final findings came to be submitted on 23.09.2016. Thus, the designated authority took its own time in submitting the disclosure statement on 14.09.2016, leaving a maximum period of 16 days ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 012 had modified the interim order passed by the learned Single Judge and permitted the designated authority to proceed further. It is in these circumstances, that the disclosure statement was issued on 10th February, 2012 and final findings were rendered on 17th February, 2012. Thus, it was due to intervening circumstances that an emergent situation had arisen at the relevant time. However, in the facts of the present case, though no such situation had arisen and it was possible for the designated authority to ensure that sufficient time was available to the parties to comment on the disclosure statement, an urgency has been created whereby no further time could be granted to the parties to defend their interests. 36.1 The challenge to the final findings is principally based upon the contention that the designated authority has placed reliance upon material and facts for concluding the issue against the petitioners which did not form part of the disclosure statement and that the petitioners, therefore, did not have any opportunity to deal with the same. Such contention is mainly based upon the fact that the designated authority in paragraph 98 of the final findings, has placed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed by the designated authority while recording the final findings, also amounts to breach of the principles of natural justice. 37. It has been contended on behalf of the petitioners that the disclosure statement suffers from pre-determination, inasmuch as, the designated authority has already recorded its conclusions as regards whether or not definitive measures are required to be applied, which are conclusions that can be arrived at only at the stage of final findings, after considering the comments on the disclosure statement. As already discussed hereinabove, the disclosure statement is required to record only the essential facts which are necessary for the purpose of determining as to whether or not the definitive measures are required to be applied or not. The designated authority is required to record its conclusions on those facts but not its conclusions based upon those facts. The conclusion as to whether or not the definitive measures are required to be applied is a conclusion based upon the essential facts and hence, could not have found place in the disclosure statement. Besides as to whether or not definitive measures are required to be applied is a conclusion that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... enge the final notification. It was contended that the precedential value of the order passed at the first stage would operate as res judicata in respect of the disclosure statement and final findings, and hence, the ground of maintainability is purely academic. It was submitted that res judicata applies at different stages of the same proceedings. To bolster such submission, the learned counsel placed reliance upon the decision of the Supreme Court in the case of Barkat Ali v. Badrinarain, (2008) 4 SCC 615, wherein the court held thus: The principles of res judicata not only apply in respect of separate proceedings but the general principles also apply at the subsequent stage of the same proceedings also and the same court is precluded to go into that question again which has been decided or deemed to have been decided by it at an early stage. 14. In Arjun Singh v. Mohindra Kumar, AIR 1964 SC 993,it was observed as follows: 10. Scope of principle of res judicata is not confined to what is contained in Section 11 but is of more general application. Again, res judicata could be as much applicable to different stages of the same suit as to findings on issues in differen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on was filed by the applicant and four others under Sections 397 and 398 of the Companies Act. During the pendency of the petition, the four other persons who had joined the applicant in filing the petition sold their shares thereby ceasing to be shareholders of the company. It was held that the application could not be rejected as not maintainable on the ground that the four shareholders ceased to be shareholders of the company. The requirement about qualification shares is relevant only at the time of institution of proceeding. In Jawahar Singh Bikram Singh (P) Ltd. v. Sharda Talwar, (1974) 44 Company Cases 552, a Division Bench of the Delhi High Court held that for the purposes of petition under Sections 397/398 it was only necessary that members who were already constructively before the court should continue the proceedings. It is a case in which the petitioner who had filed a petition died during the pendency of the petition. While filing the petition he had obtained consent of requisite number of shareholders of the company, among them his wife was also there. The Court further observed that since the wife of the petitioner was already constructively a petitioner in the orig ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nate the proceedings once the prescribed schedule has been followed. It was submitted that if the court is convinced of a procedural flaw and remands the case, it would be restored to the stage at which it is remanded and the time limits would apply accordingly. The petitioners would have to face proceeding at the stage which it stands vitiated. In support of such submission, the learned counsel placed reliance upon the decision of the Supreme Court in the case of Director of Inspection of Income Tax (Investigation) v. Pooran Mal Sons, (1975) 4 SCC 568, wherein it has been held thus: 6. Even if the period of time fixed under Section 132(5) is held to be mandatory that was satisfied when the first order was made. Thereafter if any direction is given under Section 132(12) or by a court in writ proceedings, as in this case, we do not think an order made in pursuance of such a direction would be subject to the limitations prescribed under Section 132(5). Once the order has been made within ninety days the aggrieved person has got the right to approach the notified authority under Section 132(11) within thirty days and that authority can direct the Income Tax Officer to pass a fre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n of the Gujarat High Court, relied upon by the respondents, in Ramjibhai Kalidas v. I.G. Desai, ITO, 80 ITR 721. In that case it was held that Rule 112-A, which provides that a show-cause notice in respect of an inquiry under Section 132(5) is to be made within 15 days from the date of the seizure, is mandatory and if that is not done no order under Section 132(5) can be passed. It seems to have been admitted before the Bench by the Advocate-General who appeared on behalf of the Revenue that he did not dispute that the period of ninety days prescribed under Section 132(5) is a mandatory period. That decision is, therefore, no authority for the proposition that the period fixed under Section 132(5) is mandatory. But even if it were the decision that Rule 112-A is also mandatory is clearly erroneous. When Section 132(5) permits an Income Tax Officer to pass an order within ninety days that power cannot be in any way whittled down by a rule made under that section. 39.1 Reference was also made to the decision of the Supreme Court in the case of Bombay Metropolitan Region Development Authority v. Gokak Patel Volkart Ltd., (1995) 1 SCC 642, wherein it has been held that the period ..... X X X X Extracts X X X X X X X X Extracts X X X X
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