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Bharat Solvent & Chemical Corporation Versus Union Of India & Others

2015 (3) TMI 729 - DELHI HIGH COURT

Levy of anti dumping duty - dumping of Pentaerythritol - only point urged on the part of the petitioner was that the petitioner, being an interested party, was not given an opportunity of oral hearing prior to the issuance of the final findings by the designated authority - Held that:- it is clear that the definition of “interested party”, being an inclusive one, cannot be regarded as an exhaustive or as a “hard and fast” definition. The expression “interested party” as defined would therefore r .....

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ty of the members of which produce the like article in India. In its natural and ordinary sense “interested party” would have reference to a party who is interested in the investigation and the ultimate outcome of it.

The petitioner was an importer of Penta from other countries such as Sweden and Germany during the period of investigation. But, in the post POI period, the petitioner had imports of Penta from Russia. In any event, the petitioner was a prospective importer of Penta fro .....

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CESTAT in the Lubrizol case with regard to the meaning to be ascribed to the expression “interested party”. The CESTAT decisions cited by Mr Sethi are clearly distinguishable as in those cases the concerned party had not participated in the investigation conducted by the DA. - petitioner falls within the expression “interested party” as defined in Rule 2(c) of the said Rules.

DA functions as a quasijudicial authority and decides a “lis” between persons supporting the levy of duty and .....

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ts / submissions / comments are no substitute for an oral hearing. In the backdrop of the clear enunciation of law by the Supreme Court [2011 (1) TMI 7 - SUPREME COURT OF INDIA], it has to be held that it is mandatory for the DA to give an opportunity of oral hearing to an interested party.

DA has violated the principles of natural justice in not giving an opportunity of hearing to the petitioner. And, that is fatal. Consequently, the Final Findings, having been rendered in violation .....

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seeks, inter alia, quashing of the Final Findings of the Designated Authority notified through the Notification dated 11.12.2014 issued under F.No.14/26/2012-DGAD by the Directorate General of Anti Dumping & Allied Duties, Department of Commerce, Ministry of Commerce & Industry, Government of India. The investigation was conducted under the provisions of the Customs Tariff Act, 1975 in respect of the alleged dumping of Pentaerythritol [hereinafter referred to as Penta ] originating in or .....

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to be issued by the Central Government on all imports of Penta originating in or exported from Russia: Duty Table S.No Heading Description of goods Specification Country of origin Country of export Producer Exporter Duty Amount Unit of measurement Currency 1 2905 42 Pentaerythritol Any grade Russia Russia Any Any 474 MT US$ 2 2905 42 Pentaerythritol Any grade Russia Any Any Any 474 MT US$ 3 2905 42 Pentaerythritol Any grade Any Russia Any Any 474 MT US$ Point in issue 3. On 13.02.2015 when this .....

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f (Identification, Assessment and Collection of Anti- Dumping Duty on Dumped Articles and for Determination of Injury) Rules, 1995 [hereinafter referred to as the said Rules ]. It was contended by Mr Sandeep Sethi, the learned senior counsel appearing on behalf of the Domestic Industry, that the definition of 'interested party' is specific to the article which is subject to investigation for being dumped in India which necessarily must have a connection with (a) the period in question, ( .....

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ntended that while it is admitted that the petitioner was not granted an oral hearing, the submissions made by the petitioner in writing before the designated authority had been considered by the DA while issuing the final findings. 5. However, the learned counsel for the petitioner had submitted that the definition of 'interested party' given in Rule 2(c) of the said Rules is an inclusive definition and is not restricted to the entities mentioned therein and that the petitioner fell wit .....

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to the domestic industry and a causal link between dumping and injury and thereby initiated an investigation into the alleged dumping, and consequent injury to the domestic industry, in terms of Rule 5 of the said Rules, to determine the existence, degree and effect of the alleged dumping and to recommend the amount of anti-dumping duty, which, if levied, would be adequate to remove the injury to the domestic industry. The period of investigation was specified as 01.01.2012 to 31.12.2012 (12 mon .....

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eparately to submit relevant information in the form and manner prescribed and to make their views known to the Designated Authority at the following address: The Designated Authority Ministry of Commerce & Industry Department of Commerce Directorate General of Anti-Dumping & Allied Duties (DGAD) Room No. 240, Udyog Bhavan, New Delhi-110011 Any other interested party may also make it's submissions, relevant to the investigation, within the time limit set out below. TIME LIMIT 14. Any .....

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tion is incomplete, the Designated Authority may record its findings on the basis of the facts available on record in accordance with the Rules. It may be noted that no request, whatsoever, shall be entertained for extension in the prescribed time limit. 7. On 31.07.2013 the petitioner submitted its response to the Initiation Notification to the effect that no case of imposition of antidumping duty was made out. It was, inter alia, submitted that Penta is an essential ingredient in the paint and .....

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m with an opportunity to defend their interest and in assisting the DA to arrive at a fair decision. They were requested to file their responses in the enclosed questionnaire. Importantly, they were also directed to send a written request in advance if they desired a hearing. 9. On 19.09.2013, the petitioner submitted its detailed response to the questionnaire in the prescribed format alongwith evidence to support its case that anti-dumping duty ought not to be imposed. 10. On 08.09.2014, a noti .....

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otice to the petitioner as it was not an interested party . It was also contended that the non-grant of a hearing to the petitioner did not, in any event, cause any prejudice to the petitioner as all of its submissions were considered by the DA in his final findings. 11. As pointed out above, the petitioner came to know that a hearing was granted, though not to the petitioner, on 09.09.2014 from the disclosure statement dated 21.10.2014. Through the Disclosure Statement, respondent no.2 invited .....

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2014, the impugned Final Findings were notified. The DA recommended that definitive anti-dumping duty as per the amounts specified in the table set out therein (and, extracted at the beginning of this judgment) be imposed from the date of the Notification to be issued by the Central Government on all imports of Penta originating in or exported from Russia. The petitioner is aggrieved by this. Questions 13. The following questions require resolution in this case:- 1. Does the petitioner fall with .....

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on behalf of the petitioner 14. Mr Balbir Singh, the learned counsel for the petitioner submitted that in terms of Rule 2(c) of the said Rules, the expression interested party includes an exporter or a foreign producer or the importer of an article subject to investigation. It was submitted that in the present case also, the Petitioner was an importer of an article subject to investigation. Furthermore, the DA in his Final Findings dated 11.12.2014 has treated the Petitioner as an interested pa .....

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that throughout the investigation, the DA treated and considered the petitioner to be an interested party . The learned counsel submitted that even if a party is not an importer of the subject goods during the period of investigation , such party can still be treated as an interested party in terms of Rule 2(c) of the said Rules. For persuasive value, Mr Balbir Singh referred to the following decisions of the Central Excise and Service Tax Appellate Tribunal (CESTAT):- (a) Lubrizol (India) Pvt. .....

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even an interested party by virtue of any post-investigation imports. On this issue, CESTAT had this to say:- 13.3 The expression interested party has an inclusive definition in Rule 2(c) and includes under sub-clause (i), inter alia, the importer of an article subject to investigation for being dumped in India. The preliminary objection is based on this definition, which takes into consideration the importer who had imported the article which is investigated. However, since the definition is in .....

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the Indian market and the injury caused thereby to the domestic industry. The transactions during the period of investigation have evidentiary value for showing the existence of dumping, but when duty was imposed on the dumped imports, it obviously will apply to the subsequent imports to prevent injurious dumping and not on the imports that have taken place during the period of investigation. Therefore, an importer, who, like the appellant, Lubrizol (India) Private Ltd, had in fact participated .....

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Submissions on behalf of the Respondents 16. On the other hand, Mr Sandeep Sethi, the learned counsel for Respondent No.3, submitted that interested parties have been defined under Rule 2(c) as an exporter or a foreign producer or the importer of an article subject to investigation for being dumped in India, or a trader or business association a majority of the members of which are producers, exporters or importers of such article and therefore includes only importers of the product under consid .....

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ed that Section 9A(1) refers to a specific article and a specific country of export or origin. And, the margin of dumping which is to be ascertained under section 9A(6) is also with reference to a specific article from a specific country of export or origin and in respect of the relevant period. 17. Mr Sethi further submitted that Rule 22 of the said Rules entitles an exporter, who has not exported the product during the period of investigation, for a new shipper review in respect of an individu .....

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ntended that the DA considers data for the injury period (3-4 years) and, therefore, if there were no imports by a company over the entire injury period, the information of the company is not relevant for determination of injury to the domestic industry. 18. It was also submitted that the questionnaire response and all the information filed by the petitioner made it evident that the petitioner had not imported the product under consideration from subject country during the period of investigatio .....

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t the petitioner s reference to the decision in Lubrizol (supra) was misplaced for the reason that in the stated decision, the status of the party as an interested party was not in dispute and the only issue was whether the party was entitled to file an appeal before CESTAT. The Tribunal held that the party was entitled to file an appeal as a party aggrieved by the order of the DA. It was submitted that in the present case, however, the writ petitioner was not even an interested party and, there .....

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s. Thus, even though the petitioner was not an interested party, the DA, in fact, has gone ahead and has addressed all the contentions of the petitioner. It was, therefore, submitted that the writ petition be dismissed. 21. The learned counsel for respondent nos. 1 & 2 endorsed these submissions of Mr Sethi and reiterated that the petitioner was not an interested party within the meaning of Rule 2(c) of the said Rules and was therefore not entitled to an oral hearing. It was also contended t .....

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estigation or during the period of investigation and they had also not participated in the proceedings before the DA. Whereas, in the present case, the Petitioner has actively participated in the Antidumping investigation. It has submitted responses, comments and answered the detailed questionnaire. 23. It was also submitted that the submissions made by the Respondents so as to suggest that, as during the period of investigation, the Petitioner had no imports from Russia and, therefore, they had .....

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f investigation. One instance cited by the learned counsel for the petitioner was the Final Finding dated 24.12.2009 in respect of imports of Carbon Black used in rubber applications originating in or exported from Australia, China PR, Iran, Malaysia, Russia and Thailand. A specific reference was made to paragraph 134 of the said final findings wherein it was stated as under:- As regards consideration of post POI data, the Authority observes that use of post POI data for the assessment of threat .....

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lea taken by the Respondents that the antidumping duty is producer/ exporter specific is not tenable in the facts of the present case. With regard to Annexures I and III, it was submitted that these annexures do not specifically provide for anti-dumping investigation to be period specific and producer/exporter specific. It was further submitted that the proposition with respect to New Shipper s Review as put forth by the Respondents would not apply to the present case inasmuch as the provisions .....

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rticle subject to investigation for being dumped in India, or a trader or business association a majority of the members of which are producers, exporters or importers of such an article; (ii) the government of the exporting country; and (iii) a producer of the like article in India or a trade and business association a majority of the members of which produce the like article in India; xxxx xxxx xxxx xxxx xxxx It is apparent that the definition is an includes definition and, therefore, it canno .....

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t when the word includes is used in the definition, as is the case under Section 2(g) of the 1994 Act, the legislature does not intend to restrict the definition; it makes the definition enumerative and not exhaustive, that is to say, the term defined will retain its ordinary meaning but its scope would be extended to bring within the term certain matters which in its ordinary meaning it may or may not comprise. Applying the above test to the term cooked food in Section 2(g) of the 1994 Act we f .....

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nt time were not directly consumable. They were undercooked items. They were semi-cooked items. They required further process of frying and addition of preservatives to make them consumables even after the specified time. But for the preservatives, the items would have become stale. (underlining added) 26. In Bharat Coop. Bank (Mumbai) Ltd. v. Employees Union: (2007) 4 SCC 685 (at page 695) the Supreme Court pointed out the difference between a definition which uses the expression means and a de .....

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Also see P. Kasilingam v. P.S.G. College of Technology [1995 Supp (2) SCC 348 : AIR 1995 SC 1395] .) On the other hand, when the word includes is used in the definition, the legislature does not intend to restrict the definition: it makes the definition enumerative but not exhaustive. That is to say, the term defined will retain its ordinary meaning but its scope would be extended to bring within it matters, which in its ordinary meaning may or may not comprise…. (underlining added) 27. T .....

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which they signify according to their natural import, but also those things which the interpretation clause declares that they shall include. Thus, where a definition uses the word includes , as contrasted from means , the word defined not only bears its ordinary, popular and natural meaning, but in addition also bears the extended statutory meaning (see S.K. Gupta v. K.P. Jain [(1979) 3 SCC 54 : AIR 1979 SC 734] following Dilworth v. Commr. of Stamps [1899 AC 99 : (1895-99) All ER Rep Ext 1576 .....

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foreign producer or the importer of an article subject to investigation for being dumped in India, or a trader or business association a majority of the members of which are producers, exporters or importers of such an article; the government of the exporting country; and a producer of the like article in India or a trade and business association a majority of the members of which produce the like article in India. In its natural and ordinary sense interested party would have reference to a part .....

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definition. The contention of the respondents that only those importers who imported Penta from Russia during the period of investigation would be covered by the expression interested party , cannot be accepted as that would ascribe a very restrictive meaning to the said expression when the law suggests that such a definition is not a restrictive one. The petitioner was an importer of Penta from other countries such as Sweden and Germany during the period of investigation. But, in the post POI p .....

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person is a party interested within the contemplation of the proviso is, whether he is likely to be affected by the decision or the result of the proceedings. 29. Applying this test, it is evident that the petitioner would be an interested party . In fact, as pointed out by Mr Balbir Singh, even the DA considered the petitioner to be an interested party and treated it as such in the impugned Final Findings. We are also in agreement with the views of CESTAT in the Lubrizol case with regard to th .....

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ve been arrived at in complete violation of principles of natural justice and the law laid down by the Supreme Court. He submitted that public hearing under Rule 6(6) of the said Rules was held on 09.09.2014 and was attended by the domestic industry alone. Apart from the fact that notice for the hearing was issued to some parties (almost all of whom were outstation parties) only on 08.09.2014, which was too short a notice, it is an admitted position that insofar as the petitioner is concerned, n .....

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tunity to an interested party to present information orally before the DA and that principles of natural justice also require that the DA grants hearing to the interested parties before giving his Final Findings. But, it was contended that as the petitioner was not an interested party , no rule or principle of natural justice had been violated by the DA not having given a hearing to the petitioner. In view of our decision on question no.1, the latter contention cannot hold good. Discussion 32. L .....

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would show that the DA determines the rights and obligations of the interested parties by applying the objective standards based on the material/ information/ evidence presented by the exporters, foreign producers and other interested parties by applying the procedure and principles laid down in the 1995 Rules. And, again- 70. …. It is manifest that while determining the existence, degree and effect of the alleged dumping, the DA determines a lis between persons supporting the levy of du .....

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l justice, because in that event the court would not ignore the legislative mandate, the requirement of giving reasonable opportunity of being heard before an order is made, is generally read into the provisions of a statute, particularly when the order has adverse civil consequences which obviously cover infraction of property, personal rights and material deprivations for the party affected. The principle holds good irrespective of whether the power conferred on a statutory body or Tribunal is .....

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power is conferred and the final effect of the exercise of that power. It is only upon a consideration of these matters that the question of application of the said principle can be properly determined. (See Union of India v. Col. J.N. Sinha [(1970) 2 SCC 458] .) 82. In the light of the aforenoted legal position and the elaborate procedure prescribed in Rule 6 of the 1995 Rules, which the DA is obliged to adhere to while conducting investigations, we are convinced that duty to follow the princip .....

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over, the alleged opportunity of oral hearing on 9-3-2005, being in relation to the price undertaking offer by Ningbo Nylon, cannot be likened to a public hearing contemplated under Rule 6(6) of the 1995 Rules. 83. The procedure prescribed in the 1995 Rules imposes a duty on the DA to afford to all the parties, who have filed objections and adduced evidence, a personal hearing before taking a final decision in the matter. Even written arguments are no substitute for an oral hearing. A personal h .....

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