2015 (9) TMI 402 - HC - Customs

Levy of Anti-dumping Duty on USB Flash Drives - validity of investigation and findings of the Designated Authority (DA) - Sub section (5) of Section 9A of the Customs Tariff Act, 1975 - It is contended by the petitioner that the non-supply of the data/evidence relied upon by the Designated Authority violated the principles of natural justice and curtailed the rights of the petitioner to defend/oppose the imposition of the Anti-Dumping Duty and also amounted to a denial of an opportunity to effectively participate in the investigation - Held that - In the present case, the Designated Authority has disregarded the transaction-by-transaction import statistics submitted by the domestic industry alongwith the application seeking initiation and introduced fresh data and relied on the transactions-by-transactions imports statistics obtained by him from the respondent No.4 at the very fag end of the investigation. The data was introduced after a period of seventeen months of initiation of investigation. Neither the copy of the said data relied upon by the Designated Authority nor the non confidential summary thereof was not supplied to the petitioners despite the same being demanded on the ground of confidentiality. The DA, in not providing the information/material considered by him, has violated the principles of natural justice and the same is fatal to the Final Findings rendered. Consequently, the Final Findings, having been rendered in violation of the principles of natural justice, stand vitiated and cannot be sustained. As a result, the impugned Final Findings are quashed. - Decided in favor of appellants. There is no merit in the contention of the respondent that since, the Final Finding are only recommendatory in nature, the petition is premature. It is no longer res-integra that this court in exercise of powers under Article 226 of the Constitution of India is empowered to entertain a petition challenging the Final Findings even prior to the same being accepted by the central government more so in a case where the principles of natural justice have not been complied with. The fact that the Rules prescribe that if the Designated Authority is satisfied that the request for confidentiality is not warranted or the supplier of the information is either unwilling to make the information public or to authorize its disclosure in a generalized or summary form, it may disregard such information, further emphasises the fact that for an investigation to comply with the principles of natural justice, it mandatorily entails sharing with the interested parties, the information/data being considered by the Designated Authority.

Issues Involved:

1. Non-supply of transaction-wise import data.
2. Violation of principles of natural justice.
3. Confidentiality of data.
4. Prematurity of the petition.
5. Alternative remedy of remand for post-decisional hearing.
6. Adherence to statutory timelines.

Issue-Wise Detailed Analysis:

1. Non-supply of transaction-wise import data:
The petitioner contended that the Designated Authority (DA) relied on new transaction-wise import data at the end of the investigation without supplying a copy to the parties, which amounted to a denial of a hearing. The petitioner argued that this data was introduced at the fag end of the investigation, much after the hearing was over, and was neither furnished to the petitioner nor was an opportunity granted to verify or comment on its reliability or admissibility.

2. Violation of principles of natural justice:
The petitioner argued that the non-supply of the data relied upon by the DA violated the principles of natural justice, curtailing the petitioner's rights to defend against the imposition of Anti-Dumping Duty and denying an opportunity for effective participation in the investigation. The court emphasized that the nature of the proceedings before the DA is quasi-judicial, and a quasi-judicial decision must be in accordance with the principles of natural justice. The court held that the DA's failure to provide the data and the non-injurious price of the subject goods as determined by him resulted in a denial of an effective hearing, thus violating the principles of natural justice.

3. Confidentiality of data:
The respondent argued that the data furnished by respondent No.4 was confidential and could not be shared with the petitioner. However, the court referred to Rule 7 of the Customs Tariff Rules, which mandates that even if the material is confidential, the DA must ask the parties providing information on a confidential basis to furnish a non-confidential summary thereof. The court held that the DA's refusal to supply the non-confidential summary of the data sourced from respondent No.4 and the non-injurious price of the subject goods violated the principles of natural justice.

4. Prematurity of the petition:
The respondent contended that the petition was premature since the Final Findings were recommendatory in nature, and the Central Government had yet to form an opinion on whether to accept them. The court rejected this argument, stating that it is empowered to entertain a petition challenging the Final Findings even before they are accepted by the Central Government, especially when the principles of natural justice have not been complied with.

5. Alternative remedy of remand for post-decisional hearing:
The respondent alternatively argued that if the court found a violation of the principles of natural justice, the matter could be remanded to the DA to cure the defect. The court examined the statutory timelines prescribed by the Rules and concluded that since the statutory period for completing the investigation had expired, the matter could not be remanded to the DA for fresh consideration.

6. Adherence to statutory timelines:
The court noted that the investigation commenced on 21.06.2013 and the Final Findings were issued on 19.12.2014, within the extended period allowed by the Rules. The court emphasized that the statutory timelines for completing investigations and reviews must be strictly followed, and any proceedings not completed within these periods would be vitiated. Since the statutory period had expired, the court held that the matter could not be remanded to the DA for fresh consideration.

Conclusion:
The court held that the DA's failure to provide the information/material considered by him violated the principles of natural justice, which was fatal to the Final Findings rendered. Consequently, the Final Findings were quashed. The writ petition was allowed to this extent, with no order as to costs.

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