2017 (7) TMI 975 - HC - Customs

Levy of ADD - Plain Gypsum Plasterboard - imported from China PR, Indonesia, Thailand, and UAE - N/N. 26/2017-Cus.(ADD) dated 7th June, 2017 - whether the impugned notification, dated 7th June, 2017, is sustainable in law in view of the interpretation of Section 9A(5) of the CTA by the Supreme Court in Kumho Petrochemicals Company Limited. 2017 (6) TMI 526 - SUPREME COURT OF INDIA , where it was held that Section 9A(5) of the Act and its proviso do not mandate a public notice or a Gazette Notification as a pre-condition for initiation of sunset review investigation - Held that - What appears to have weighed with the Supreme Court in Kumho Petrochemicals Company Limited was the void or gap between the expiry of the original notification and the issuance of the notification extending the ADD i.e., between 1st and 23rd January, 2014. That case is distinguishable from the present case on the basis of this single fact. The facts in Kumho Petrochemicals Company Limited revealed the existence of a sizable hiatus of more than 20 days between the two notifications i.e., one continuing the ADD and the original ADD notification. That is, however, not the case here as the intention of the Central Government to continue the ADD without a gap is evident in the present case. There is no hiatus as such between the original notification imposing the ADD and the impugned notification continuing it. If indeed, in terms of Section 5 (3) of the GCA, which by analogy could be extended to notification issued by the Central Government as well, the notification comes into operation immediately on the expiration of the day preceding its commencement , it takes us to the point where there is no gap whatsoever between the expiration of the old notification with the commencement of the new. The key words are immediately on the expiration. It is not possible to accept the submission of Mr. Sethi that the impugned Notification dated 7th June, 2017 was issued after the expiry of the original ADD Notification which came to an end at the midnight of 6th June, 2017. Petition dismissed - decided against petitioner.

Summary

Issues Involved:
1. Validity of the Notification No. 26/2017-Cus.(ADD) dated 7th June, 2017.
2. Interpretation of Section 9A(5) of the Customs Tariff Act, 1975 (CTA).
3. Application of the Supreme Court's decision in Union of India v. Kumho Petrochemicals Company Limited.
4. Timing and continuity of Anti-Dumping Duty (ADD) notifications.

Issue-wise Detailed Analysis:

1. Validity of the Notification No. 26/2017-Cus.(ADD) dated 7th June, 2017:
The petitioner challenged the notification extending the ADD on imports of Plain Gypsum Plasterboard from China PR, Indonesia, Thailand, and UAE. The petitioner argued that the notification extending the ADD was issued after the expiration of the original notification, which ended at midnight on 6th June 2017. The court, however, found that there was no gap between the original notification and the new one, as the new notification took effect immediately upon the expiration of the old one, thus maintaining the continuity of the ADD.

2. Interpretation of Section 9A(5) of the Customs Tariff Act, 1975 (CTA):
Section 9A(5) of the CTA states that ADD shall cease to have effect after five years unless extended by the Central Government. The second proviso allows the ADD to continue for a further period not exceeding one year if a sunset review is initiated before the expiry of the original notification. The court noted that the Central Government has the discretion to continue the ADD during the sunset review period, and this discretion was exercised in the present case without any gap between the notifications.

3. Application of the Supreme Court's decision in Union of India v. Kumho Petrochemicals Company Limited:
The petitioner relied on the Supreme Court's decision in Kumho Petrochemicals, where it was held that there should be no automatic continuation of ADD and that the ADD must be extended before the expiration of the original notification. The court distinguished the present case from Kumho Petrochemicals, noting that in Kumho, there was a significant gap between the expiration of the original notification and the issuance of the new one. In contrast, in the present case, the new notification was issued without any gap, thus complying with the requirements of Section 9A(5).

4. Timing and continuity of Anti-Dumping Duty (ADD) notifications:
The court emphasized that the timing of the notification is crucial. According to Section 5(3) of the General Clauses Act, 1897, a notification comes into operation immediately upon the expiration of the preceding day. Therefore, the notification issued on 7th June 2017 was effective from the midnight of 6th/7th June 2017, ensuring no gap between the expiration of the original ADD notification and the commencement of the new one.

Conclusion:
The court concluded that the impugned notification dated 7th June 2017 was valid and issued in compliance with the legal requirements. The petition was dismissed, and the ADD on imports of Plain Gypsum Plasterboard from the specified countries was upheld. The court found no merit in the petitioner's arguments and maintained the continuity of the ADD without any interruption.