TMI Blog2020 (9) TMI 139X X X X Extracts X X X X X X X X Extracts X X X X ..... ucial; the DA is duty bound to follow them. The analysis of the particular market behaviour by the allegedly offending foreign exporters, involves sifting of a great deal of evidence, such as manufacturing capacity, financial abilities, overall capacity of the country in the like field, prices, and the margin of acceptable delinquent behaviour, as well as domestic capacity, efficiency, etc, while determining if an injury exists, the margin of such injury and its likely duration. Keeping the imperative of completion of investigation within a pre-determined timeline, the guidelines contained in the Manual of Operation for Trade Remedy Investigations (Period of Investigation and Injury Investigation period) as to the contemporaneousness of the data necessary to carry out the investigation, assume importance - The rationale for these guidelines is self-evident: any investigation carried out for past periods would in all likelihood, result in minimal levy. For instance, if in 2020, investigation is initiated for the period 2013-14, with the object of determining anti-dumping, even if injurious behavior is found, the levy can be only of limited duration. Further, to levy duty for the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... riginating in and exported into India from Saudi Arabia. Butanol is a basic organic chemical and a primary alcohol; it is an excellent solvent for acid-curable lacquers and baking finishes. A large part of normal Butanol is converted into derivatives for use as solvents in coating industries. This application resulted in the initiation of investigation by the designated authority into the import of the subject articles from Saudi Arabia, by notification dated 02.09.2016. 3. Andhra Petro furnished import data for the period of three months. The period of investigation was from April, 2015 to March, 2016. The Designated Authority granted a public/oral hearing to interested parties on 23.06.2017 followed by written submissions. Andhra Petro also attended the hearing and filed detailed submissions on 30.06.2017. It alleged that the information given was not only for the period of investigation but also for the entire injury period, 2012-13 to 2014-15. Andhra Petro admitted that dumping from Saudi Arabia occurred in the last three months of the period of investigation, i.e., January to March, 2016, and that there were no imports from Saudi Arabia in the first nine months of the perio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ns on capital employed and cash flow. Thus, deterioration in profits, return on capital employed and cash flow was due to the dumped imports. 6. In the investigation proceedings, Andhra Petro submitted its written submissions on 27.10.2017, pursuant to the second oral public hearing held on 24.10.2017 owing to the change in the incumbent holding the office of the Designated Authority. It also filed rejoinder submissions on 01.11.2017. In terms of Rule 16 of the Customs Tariff (Identification, Assessment and Collection of Antidumping Duty on Dumped Article and for Determination of Injury) Rules, 1995 (hereafter the Rules of 1995 ), the Designated Authority disclosed essential facts under consideration, which would form the basis for his final conclusion under the Disclosure Statement dated 14.11.2017. Andhra Petro filed its comments on such statement, on 21.11.2017. The Designated Authority issued the Final Findings, by Notification dated 28.11.2017, terminating the investigation under Rule 14(b) of the Rules of 1995. 7. The Designated Authority recorded the following findings: (i) Period of last 3 months of POI of exports of subject goods from Saudi Arabia was insuffici ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... competition with like articles made in India and passed the impugned order declining to initiate anti-dumping investigation. 10. The Central Government, which filed its return, to the Writ proceeding argued that Andhra Petro produced only 2-EH, not INA and 2-PH, and as it filed the combined application for all the said products, the Designated Authority rejected the request of the petitioner. The letters produced by Andhra Petro to show that 2-EH, INA and 2-PH are like articles , were not issued by any independent/recognised agency/source and hence they could not be considered. It was further stated that though several opportunities were given to Andhra Petro seeking clarifications as to how the acyclic alcohols i.e., 2-EH, INA and 2-PH are like articles when it does not produce INA and 2-PH, it did not submit any clarification, and it filed a combined application for imposition of anti-dumping duty for all three products. 11. The High Court disposed of the second writ petition on 28.08.2018 making the following observations and directions: 7. In spite of specific direction of this Court in W.P.No.25988 of 2017 dated 09.02.2018, the second respondent has not dealt wi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ****** 2(d) like article means an article which is identical or alike in all respects to the article under investigation for being dumped in India or in the absence of such an article, another article which although not alike in all respects, has characteristics closely resembling those of the articles under investigation. 8. The second respondent has not considered the issue whether the imported products and the domestic products are technically and commercially substitutable and has not come to a conclusion on like article . This action of the second respondent becomes absolutely ignoring the order of this Court dated 09.02.2018 in W.P. No. 25988 of 2017 and the impugned order is one without application of mind. There is no cogent reason pushing the petitioner to file repeated applications and the second respondent cannot pass orders in a routine and casual manner, in spite of sufficient material available with him. 9. In the light of the above, this writ petition is allowed, setting aside the order of the second respondent dated 05.03.2018. The second respondent is directed to take steps for initiating investigation to determine the anti-dumping in respect ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 4. Para 12 of the notice read as follows: The Petitioner has filed data for the period January 2016 to December 2016. In view of the High Court's order, the Authority initiates the investigation by prima facie evaluating dumping and injury based on the data provided by the applicant. However, to investigate further the POI is proposed to be considered, as 1.4.2018 to 31.3.2019 to evaluate dumping, injury and causality of injury to the petitioner due to alleged dumping. 15. Later, on the same date, a corrigendum was issued and para 12 was amended by adding the following in the last line: The injury investigation period will however cover the periods April 2015-March' 2016, April 16-March 2017, April 2017-March 2018 and the period of investigation. 16. By the first impugned order, the High Court initiated suo motu contempt proceedings after recounting the previous litigation and its directions, in those petitions. It noted that the DA, after disposal of the first petition, undertook the exercise only in relation to the period of investigation sought by Andhra Petro without enlarging it (i.e. the period); this led to the order of the DA rejecting the appl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to initiate suo motu contempt proceedings against the said authority by name. 3. That being so, we are of the opinion that it would not be proper for the said authority to undertake the necessary exercise pursuant to the order dated 28.08.2018 passed in W.P. No.11116 of 2018. We are informed that there are three officers, viz. Mr. Mithileshwar Thakur, Mr. Satish Kumar and Ms. Shubhra, all of the rank of Additional Director General in the Department, who would be competent to take up the exercise pursuant to the aforesaid order. 4. Sri K. Lakshman, learned Assistant Solicitor General for India, would inform this Court that the designated authority would have to be appointed by the Union of India. 5. We accordingly dispose of the writ petition directing the Union of India, the third respondent herein, to choose one of the aforestated officers and appoint him/her as the designated authority to do the needful and undertake the exercise pursuant to the order dated 28.08.2018 passed in W.P. No.11116 of 2018. This exercise shall be completed expeditiously by the Union of India and in any event, not later than two weeks from the date of receipt of a copy of this order. Pe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... expression like article was mala fide. The learned AG urged the Court to review the impugned order on the two specific grounds, i.e. that the so-called enlarged period is contrary to law and consequently that non-inclusion of articles other than those notified, too was not justified. These fall within the exclusive domain of the DA and could not be interfered with in proceedings under Article 226 of the Constitution. 21. Mr. Mukul Rohatgi, learned senior counsel appearing for Andhra Petro argued that the impugned orders do not call for interference. It was argued that the DA, despite repeated directions, failed to appreciate the submission by Andhra Petro, that the material on record disclosing that 2-Ethyl Hexanon (2-EH) supplied by the domestic industry is an article like 2-Propytheptyl Alcohol (2-PH) and Isononanol (INA) imported from the concerned countries. It is urged that commercially and technically, the two products can fall within the description of like product relatable to 2-Ethyl Hexanol offered by Andhra Petrochemicals Limited. Therefore, for a valid initiation of investigation, Andhra Petrochemicals Limited satisfied the criteria enumerated under Rule 2(8). ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sation of such duty is likely to lead to continuation or recurrence of dumping and injury, it may, from time to time, extend the period of such imposition for a further period of five years and such further period shall commence from the date of order of such extension: Provided further that where a review initiated before the expiry of the aforesaid period of five years has not come to a conclusion before such expiry, the antidumping duty may continue to remain in force pending the outcome of such a review for a further period not exceeding one year. ****************** ] Section 9C of the Customs Tariff Act provides for an appeal to the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) against an order of determination or review thereof regarding the existence, degree and effect of any subsidy or dumping in relation to import of any article. 25. This court, in S S Enterprise v. Designated Authority (2005) 3 SCC 337, observed that the purpose behind the imposition of the duty is to curb unfair trade practices resorted to by exporters of a particular country of flooding the domestic markets with goods at rates which are lower than the rate at which the expo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n India consequent upon the import of article from specified countries. The meaning of dumping is defined by Rule 10.[ Rule 10 reads as follows: 10. Determination of normal value, export price and margin of dumping. 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 these rules. ] Rule 17, which speaks of the findings of the DA, obliges that authority to make its final findings not later than one year from the initiation of investigation through a report that outlines the export price, normal value and margin of dumping, whether import of the article into India from specified countries causes material injury, or threatens injury, or materially retards the establishment of any industry in India, the causal link between the dumped import, etc. The proviso to Rule 17 (1) empowers the Central Government in its discretion in special circumstances to extend further the said period of one year ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , financial abilities, overall capacity of the country in the like field, prices, and the margin of acceptable delinquent behaviour, as well as domestic capacity, efficiency, etc, while determining if an injury exists, the margin of such injury and its likely duration. The judgment of this court in Union of India v. Kumho Petrochemicals (2017) 8 SCC 307 has noticed that as a signatory to GATT and the Marrakesh Agreement, the Anti-Dumping Rules (ADA) are to be assimilated into domestic laws. The provision of Article 5.10 of the Marrakesh Agreement is strict with respect to the timeline for taking up and conclusion of investigation.[ Article 5.10 reads as follows: 5.10 Investigations shall, except in special circumstances, be concluded within one year, and in no case more than 18 months, after their initiation. ] Article 10 empowers states to levy duties, with retrospective effect, only for a limited period (90 days subject to fulfilment of prescribed conditions) prior to the date of application of provisional measures, when the authorities determine for the dumped product in question that:.. [ Article 10.6, Marrakesh Agreement ] This has been given effect to by Rules 17 a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in all likelihood, result in minimal levy. For instance, if in 2020, investigation is initiated for the period 2013-14, with the object of determining anti-dumping, even if injurious behavior is found, the levy can be only of limited duration. Further, to levy duty for the period after findings are rendered, the POI would yield stale results, and cannot justify levy for later periods. Keeping this in mind, the DA, apparently in the present case, having regard to Para 5.9 (quoted above) required Andhra Petro to furnish relatively contemporary data. Such an action cannot be termed as arbitrary. In this court s opinion, the impugned orders were plainly erroneous in chastising the DA, and even directing his replacement, for what appears to be his adherence to prescribed procedure. 32. Access to judicial review is a valuable right conferred upon citizens and persons aggrieved; the Constitution arms the High Courts and this court with powers under Articles 226 and 32. At the same time, barring exceptional features necessitating intervention in an ongoing investigation triggered by a complaint by the concerned domestic industry, judicial review should not be exercised virtually as a co ..... 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