2017 (4) TMI 201 - HC - Customs

Validity of notification dated 30-9-2016 - the Designated Authority which initiates investigation and did so in the present case through the impugned notification, is required first to determine the relevant factors, having regard to the opposition or support, as the case may be, and subject to the conditions outlined in the proviso to sub-rule (3)- Held that - learned senior counsel could not show any provision in the rules which compels the Designated Authority to give a preliminary ruling as to the validity of the objections raised. In the circumstances, it would not be appropriate for this Court to intervene and interdict with the impugned notifications - petition dismissed - decided against petitioner.

Summary

Issues:
Challenge to the notification for initiation of Countervailing Duty/Anti-Subsidy Investigation concerning the import of Hot Rolled and Cold Rolled Stainless Steel Flat Products from China.

Detailed Analysis:

1. Legality of Investigation Initiation:
The petitioner challenges the initiation of the investigation, arguing that it is flawed and contrary to Rule 5 of the Customs Tariff (Identification, Assessment and Collection of Countervailing Duty on Subsidized Articles and for Determination of Injury) Rules, 1995. It is contended that the investigation has proceeded on a composite basis for two distinct articles, Hot Rolled and Cold Rolled Stainless Steel Flat Products, with different production processes and economic aspects. The petitioner asserts that the investigation could lead to a distorted picture and prejudice to manufacturers of these articles. Additionally, the petitioner argues that the initiation of the investigation is an attempt to circumvent the concluded anti-dumping proceedings that resulted in the imposition of high rates of anti-dumping duty, particularly on Chinese exporters due to their non-market economy status.

2. Rules 6 and 7 Compliance:
Rules 6 and 7 of the 1995 rules outline the necessary elements for the Designated Authority to consider. Rule 6(3) emphasizes the importance of examining the degree of support or opposition from domestic producers of the like article when initiating an investigation. The Designated Authority must also assess the accuracy and adequacy of evidence provided by domestic producers regarding subsidy, injury, and the causal link between subsidized imports and alleged injury. The launch of the investigation is based on materials provided by domestic producers, and at this stage, the involvement of the foreign exporter is not required. The Court notes that the Designated Authority's decision to proceed in a composite manner may be legitimate, and the petitioner has the right to contest the initiation with respect to both articles.

3. Court's Decision:
The Court finds that there is no provision compelling the Designated Authority to give a preliminary ruling on the validity of objections raised. Therefore, the Court declines to intervene and halt the proceedings based on the petitioner's concerns. The petitioner is encouraged to present all contentions to the Designated Authority, which should address and provide a detailed response to each raised question. Ultimately, the writ petition is dismissed, allowing the Designated Authority to conduct a thorough investigation and make informed decisions based on the arguments presented.

This detailed analysis of the judgment highlights the key legal arguments, rules' compliance, and the Court's decision regarding the challenge to the initiation of the Countervailing Duty/Anti-Subsidy Investigation concerning the import of Stainless Steel Flat Products from China.