TMI Blog2022 (5) TMI 1400X X X X Extracts X X X X X X X X Extracts X X X X ..... This aspect was considered by the Supreme Court in UNION OF INDIA AND ANOTHER VERSUS M/S. KUMHO PETROCHEMICALS COMPANY LIMITED AND ANOTHER [ 2017 (6) TMI 526 - SUPREME COURT ]. The Supreme Court observed that even if the review exercise is not completed within the extended period of one year under the second proviso, the effect would be that after lapse of one year there would not be any anti-dumping duty even if the review is pending. In such a situation it is only after the review exercise is completed and the Central Government forms an opinion that cessation of such duty is likely to lead to continuation or recurrence of dumping an injury, it can issue a notification for imposition of duty. The Supreme Court emphasized that the vacuum would be only during the interregnum beyond the period of one year and till the issuance of fresh notification by the Central Government. It, therefore, follows that there is no requirement that a notification has to be issued by the Central Government under the first proviso to section 9A(5) of the Tariff Act only during the lifetime of the earlier notification imposing anti-dumping duty for a period of five years. Central Government, by a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bunal, by an order dated 11.08.2011, in Allied Enterprises vs. Designated Authority [ 2011 (272) E.L.T. 127 (Tri.-Del.) ], remanded the matter to the designated authority for giving a post-decisional hearing. It was, however, left open to designated authority to make such modifications in the final findings as would be considered necessary and in case any modifications were made, they would be given effect to by the Central Government by making necessary amendments in the notification dated 26.07.2010. The relevant directions contained in the order of the Tribunal are reproduced below: 12. The questions raised before us in these numerous appeals and in several other appeals pending before the Tribunal (totally numbering about 40 appeals) involve serious economic consequences. In all the cases relating to these appeals, the successor DA has not given a fresh hearing as per the prevailing practice in the Ministry of Commerce. Now the Hon ble Supreme Court in ATMA (supra) disapproves such a practice . We are sure, in the future, the successor DA would adhere to the law laid down by the Hon ble Supreme Court and grant fresh hearings. But should the domestic industry be left to su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ciples of natural justice in as much as while the public hearing was conducted by a particular officer as the designated authority, the final findings were recorded by another officer as the designated authority. For this contention, reliance was placed on the judgment of the Supreme Court in Automotive Tyre Manufacturers Asson. vs. Designated Authority [ 2011 (263) E.L.T. 481 (S.C.) ]. This contention was accepted and the Tribunal remanded the matter to the designated authority for giving a post-decisional hearing with certain observations that have been noted above. 5. On 10.04.2012, pursuant to the aforesaid directions issued by the Tribunal, the designated authority confirmed the findings earlier arrived at on 17.05.2010. The relevant portions of the final findings dated 10.04.2012 of the designated authority, pursuant to the remand order, are as follows: In pursuance of the Hon ble Tribunal (CESTAT s) Final order No. AD/31-51/2011- AD dated 11th August, 2011, a Post-decisional hearing was held on 14th December, 2011 on the captioned subject, wherein the interested parties that had participated in the instant investigation were requested to participate. 2. Upon concl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... with liberty to the petitioner to file an appeal before the Tribunal and the relevant portion of the judgment of the Madras High Court is reproduced below: 2. The Petitioner challenges the notification i n File No.15/9/2015 - DGAD dated 08.07.2016 issued by the Second Respondent and consequent Customs Notification No.43/2016-Customs dated 08.08.2016 issued by the First Respondent. 3. When it is pointed out by Learned Counsel appearing for the First and Second Respondents that the Petitioner has got an effective alternative remedy to challenge the impugned order by way of appeal before the Customs, Excise and Service Tax Appellate Tribunal under Section 9-C of the Customs Tariff Act, 1975, Learned Counsel for the Petitioner seeks permission of this Court to withdraw the Writ Petition with liberty to resort to the aforesaid procedure. He has also filed a memo dated 09.10.2020 to that effect through e-mail, which is placed on record. 4. The Writ Petition is dismissed as withdrawn granting such liberty. It is made clear for the purpose of reckoning limitation for availing aforesaid remedy, the period from the date of filing of this Writ Petition, viz., 30.11.2016, ti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... findings dated 17.05.2010 impliedly stood quashed; (ii) Consequent to the aforesaid directions of the Tribunal, the designated authority gave final findings on 10.04.2012 confirming the earlier final findings dated 17.05.2010, but the Central Government did not issue any notification to accept the final findings dated 10.04.2012. Anti-dumping duty, therefore, could not have been imposed on the basis of such findings; (iii) The power to extend the period of duty under section 9A(5) of the Tariff Act could only have been exercised during the life of the duty and any gap invalidates the continuation of duty. Thus, if the notification dated 26.07.2010 was valid upto 25.07.2015, a hiatus was created in continuation of the duties when the notification dated 06.08.2015 was issued extending the anti-dumping duty for a period of one year w.e.f 26.07.2015 till 25.07.2016. No anti-dumping duty could, therefore, have been levied between 26.07.2015 and 05.08.2015. In this connection, reliance has been placed on the judgment of the Supreme Court in Union of India vs. Kumho Petrochemicals Company Ltd. [ 2017 (351) E.L.T. 65 (S.C.) ] and the judgment of the Delhi High Court in Forech Ind ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pport of this contention reliance has been placed on the decision of the Supreme Court in Designated Authority vs. Reliance Industries Ltd. [ 2004 (163) E.L.T. A113 (S.C.) ] 13. Shri Ameet Singh, learned counsel appearing for the designated authority and Shri Nagendra Yadav, learned counsel appearing for the Union of India, adopted the submissions made by Ms. Reena Khair, learned counsel for the respondent domestic industries and also submitted that in view of the provisions of section 9A(5) of the Tariff Act, there is no mandatory requirement that a notification for extension of the anti-dumping duty should be issued before the expiry of the period of five years or one year. 14. The submissions advanced by the learned counsel for the appellant and the learned counsel for the domestic industry and the designated authority as also the learned authorized representative of the department have been considered. 15. In order to appreciate the submissions, it would be appropriate to reproduce section 9A(5) of the Tariff Act and it is as follows: 9A(5) The anti-dumping duty imposed under this section shall, unless revoked earlier, cease to have effect on the expiry of five yea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n made by the designated authority in the final findings dated 10.04.2012, anti-dumping duty could not have been levied. In this connection, learned counsel for the appellant pointed out that the Tribunal, while adjudicating the challenge to the final findings dated 17.05.2010 of the designated authority and the notification dated 26.07.2010 issued by the Central Government imposing anti-dumping duty on imports of the subject goods, had in Allied Enterprises remanded the matter to the designated authority for affording a post-decisional hearing and for making such modifications in the final findings as may be considered necessary as a result of such post-decisional hearing. According to the learned counsel for the appellant, it would necessarily follow from the aforesaid directions of the Tribunal that the notification dated 26.07.2010 impliedly stood quashed. 19. It is not possible to accept this contention of learned counsel for the appellant. It is clear from a perusal of the decision of the Tribunal that the reason why the matter had been remanded to the designated authority was that one particular designated authority had conducted public hearing but a successor designated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vestigation was initiated on 22.07.2015 before the expiry of aforesaid period of five years, but a notification in terms of the second proviso to section 9A(5) of the Tariff Act was issued only on 06.08.2015 by which the notification dated 26.07.2010 was amended by adding paragraph 3 to the effect that notwithstanding anything contained in paragraph 2, the notification shall continue to remain in force upto and inclusive of the 25th day of July 2016, unless revoked earlier. Learned counsel submitted that in view of the judgments of the Delhi High Court in Forech India and Kumho Petrochemicals Co. Ltd. vs. Union of India [ 2014 (306) E.L.T. 3 (Del.) ], a notification in terms of the second proviso to section 9A(5) of the Tariff Act could have been issued only during the lifetime of the notification dated 26.07.2010. In other words, the contention advanced is that a notification in terms of the second proviso to section 9A(5) of the Tariff Act could have issued only on or before 25.07.2015. 22. This issue was examined by the Delhi High Court in Kumho Petrochemicals. The final findings dated 17.07.1997 of the designated authority were accepted by the Central Government and a notifi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Government is not arguing that it had the benefit of Section 21 of the General Clauses Act - for the simple reason that extension or amendment of an earlier notification can be only after following the procedure adopted while issuing the main notification. In the present case, the amendment is retrospective, as it were, and made effective from 2009. It was in fact made after the lapse of the first period. (emphasis supplied) 23. The aforesaid judgment of the Delhi High Court in Kumho Petrochemicals was assailed by the Union of India before the Supreme Court. The Supreme Court, in the judgment dated 09.06.2017, did not find any infirmity in the approach of the High Court in interpreting the second proviso to sub-section (5) of section 9A of the Tariff Act and the relevant observations of the Supreme Court are as follows: 31) After giving due consideration to the arguments advanced by the learned counsel for the parties, we are inclined to agree with the High Court that proviso to sub-section (5) of Section 9A of the Act is an enabling provision. That is very clear from the language of the said provision itself. Sub-section (5) of Section 9A gives maximum life of five y ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ding one year. Thus, maximum period of one year is prescribed for this purpose which implies that the period can be lesser as well. The Government is, thus, to necessarily form an opinion as to for how much period it wants to continue the anti-dumping duty pending outcome of such a review. Moreover, since the maximum period is one year, if the review exercise is not completed within one year, the effect of that would be that after the lapse of one year there would not be any anti-dumping duty even if the review is pending. In that eventuality, it is only after the review exercise is complete and the Central Government forms the opinion that the cessation of such a duty is likely to lead to continuation or recurrence of dumping and injury, it would issue a notification extending the period of imposition of duty. Therefore, there may be a situation where even when the power is exercised under second proviso and duty period extended by full one year, the review exercise could not be completed within that period. In that situation, vacuum shall still be created in the interregnum beyond the period of one year and till the review exercise is complete and fresh notification is issued. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iple to the facts of the present case, it is seen that the Notification No. 17/2013 issued 60 days after the expiry of the levy of Anti-dumping duty under the first five year period, would be non est because it sought to extend a levy which had lapsed on 4-5-2013. The second proviso to Section 9A(5) of the Act is an enabling provision granting the Central Government the authority to continue Anti-dumping duty pending the outcome of the Sunset Review for a further period not exceeding one year. The essential requirements for such continuation are : (i) the Sunset Review ought to have been initiated before the expiry of the five year period of levy of Anti-dumping duty; (ii) the inquiry has not concluded within the said period; (iii) a prima facie view is formed by the Government that continuance of the Anti-dumping duty would be necessary, and (iv) such extended period would not exceed one year from the date on which the first five years expires. The phrase may continue to remain in force , assumes that there is a levy which exists and its continuance i.e. its carrying forward - without a break in its existence, is necessary. The moment the levy comes to an end or there is a bre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssible to accept this contention of the learned counsel for the appellant. 31. In a sunset review, a notification is issued by the Central Government exercising powers under the first proviso to section 9A(5) of the Tariff Act, unlike the powers that are exercised by the Central Government under the second proviso to section 9A(5) of the Tariff Act for continuing the anti-dumping duty during the pendency of a sunset review for a maximum period one year. There is no requirement under the first proviso to section 9A(5) of the Tariff Act that the Central Government should issue the notification only during the lifetime of the earlier notification imposing anti-dumping duty. This aspect was considered by the Supreme Court in paragraph 33 of the judgment rendered in Kumho Petrochemicals. The Supreme Court observed that even if the review exercise is not completed within the extended period of one year under the second proviso, the effect would be that after lapse of one year there would not be any anti-dumping duty even if the review is pending. In such a situation it is only after the review exercise is completed and the Central Government forms an opinion that cessation of such dut ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... prices. Dumping margin and injury margin are positive and significant. Performance of the Domestic Industry has worsened in terms of various economic parameters. There is likelihood of price under cutting in case of cessation of anti-dumping duty. Based on such finding he recommended continuation of definitive anti-dumping duty on all imports of subject goods. Accordingly, the Customs Notification dated 8-8-2016 was issued by the Ministry of Finance to give effect to the recommendations. 12. After having carefully considered the rival submissions we note that anti-dumping duty is a trade remedy measure to counter dumping. Imposition of anti-dumping duty is authorized in terms of an international agreement under WTO. Protection of domestic industry of the Member country against unfair trade practices is the rationale in imposing such duty. Section 9A(5) of the Customs Tariff Act, 1975 provides for review of the anti-dumping duty imposed. If upon review, if the Government is of the opinion that the cessation of such duty is likely to lead to continuation or recurrence of dumping and injury, it may, extend the period of such imposition for a further period of 5 years. In the facts ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 34. It is for this reason that learned counsel for the respondent submitted that as the imposition of anti-dumping duty imposed by notification dated 08.08.2016 stood expired on 07.08.2021, this appeal has been rendered infructuous and in support of this contention reliance has been placed on the judgment of the Supreme Court in Reliance Industries. 35. Once it has been held that anti-dumping duty was validly imposed by notification dated 08.08.2016 for a period five years upto 07.08.2021, it would not be necessary to examine this issue. 36. It, however, needs to be noted that the Supreme Court in Reliance Industries had examined a situation where the period stipulated for imposition of anti-dumping duty had lapsed and in view of the statement made by the learned Assistant Solicitor General of India, dismissed the Special Leave Petition. The observations are as follows: Mr. R.N. Trivedi, learned ASG fairly admits that the five years period is already over. He states that this Special Leave Petition has become infructuous. The Special Leave Petition is dismissed as such. Question of law is left open. 37. Learned counsel for the appellant also submitted that the desi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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