2021 (11) TMI 200 - AT - Customs

Failure to Levy of Anti Dumping Duty - import from China PR, Malaysia and Vietnam - maintainability of appeal u/s 9C of Customs Act - Violation of principles of natural justice - HELD THAT - A very elaborate procedure has been prescribed for determining whether anti-dumping duty has to be imposed or not. A perusal of the final findings of the designated authority shows that the designated authority had examined the market economy treatment, normal value, export price and determination of dumping margin after taking into consideration the submissions made by the domestic industry and the other interested parties. It also examined whether injury cost to the domestic industry can be attributed to any factor, other than the dumped imports and whether there was a causal link between dumped imports and the injury to the domestic industry as also the magnitude of injury and injury margin. The designated authority had, after a detailed analysis, arrived at a conclusion that anti- dumping duty was required to be imposed and accordingly made a recommendation to the Central Government. It was, therefore, necessary for the Central Government to have examined all the relevant aspects necessary for deciding whether anti-dumping duty was required to be imposed or not and deal with the findings recorded by the designated authority, if the Central Government was to take a view different from the view expressed in the recommendation made by the designated authority. Recording of reasons, therefore, is a must if the Central Government decides not to follow the recommendation made by the designated authority. It is also necessary for the Central Government to record reasons in such a situation because an appeal lies to the Tribunal against the determination made by the Central Government. It is not possible to sustain the decision taken by the Central Government, contained in the Office Memorandum dated 14.12.2020, not to impose anti- dumping duty despite a recommendation having been made by the designated authority for imposition of anti-dumping duty. The matter would, therefore, have to be remitted to the Central Government to take a fresh decision on the recommendation made by the designated authority. The matter is remitted to the Central Government to reconsider the recommendation made by the designated authority - Appeal allowed by way of remand.

Issues Involved:
1. Maintainability of the appeal under Section 9C of the Tariff Act.
2. Nature of the Central Government's decision-making power under Section 9A of the Tariff Act.
3. Requirement for the Central Government to provide reasons for its decision.
4. Consideration of superior public interest in the decision-making process.

Issue-wise Detailed Analysis:

1. Maintainability of the Appeal under Section 9C of the Tariff Act:
The Tribunal examined whether the appeal was maintainable under Section 9C of the Tariff Act. Section 9C(1) states that an appeal against the order of determination regarding the existence, degree, and effect of dumping in relation to import of any article shall lie to the Customs, Excise and Service Tax Appellate Tribunal (CESTAT). The Tribunal concluded that the decision of the Central Government not to impose anti-dumping duty, as contained in the Office Memorandum dated 14.12.2020, is indeed an order of determination regarding the existence, degree, and effect of dumping. Thus, the appeal was held to be maintainable under Section 9C of the Tariff Act. This conclusion was supported by the Supreme Court's decision in Saurashtra Chemicals Ltd. vs. Union of India and the Delhi High Court's decision in Jindal Poly Film Ltd. vs. Designated Authority.

2. Nature of the Central Government's Decision-Making Power under Section 9A of the Tariff Act:
The Tribunal discussed whether the function performed by the Central Government under Section 9A of the Tariff Act is quasi-judicial or legislative. The Supreme Court in Reliance Industries Ltd. vs. Designated Authority held that the notification of the Central Government under Section 9A is quasi-judicial. The Tribunal rejected the contention that the Central Government's function is legislative, as argued by the Department based on the Gujarat High Court's decision in Alembic Ltd. The Tribunal emphasized that the function is quasi-judicial, requiring compliance with principles of natural justice.

3. Requirement for the Central Government to Provide Reasons for its Decision:
The Tribunal highlighted the necessity for the Central Government to provide reasons for its decision, especially when it deviates from the recommendation of the designated authority. This requirement is rooted in the principles of natural justice and ensures transparency and fairness in decision-making. The Tribunal referred to several Supreme Court decisions, including S. N. Mukherjee vs. Union of India and Kranti Associates Pvt. Ltd. vs. Masood Ahmed Khan, which mandate that quasi-judicial authorities must record reasons in support of their conclusions. The Tribunal noted that the Office Memorandum dated 14.12.2020 did not disclose any reasons for rejecting the designated authority's recommendation, rendering the decision arbitrary and unsustainable.

4. Consideration of Superior Public Interest in the Decision-Making Process:
The Tribunal acknowledged that superior public interest could be a valid ground for the Central Government to refuse the imposition of anti-dumping duty. However, the Tribunal emphasized that such reasons must be explicitly stated and justified in the decision. The Office Memorandum did not mention superior public interest as a reason for the decision, and the Tribunal held that it is not open to the respondents to introduce this argument in the appeal. Consequently, the Tribunal found that the decisions cited by the respondents, such as Sales Tax Officer vs. Shree Durga Oil Mills and Kasinka Trading vs. Union of India, were not applicable to the present case.

Conclusion:
The Tribunal set aside the Office Memorandum dated 14.12.2020 and remitted the matter to the Central Government for reconsideration of the designated authority's recommendation in light of the Tribunal's observations. The appeal was allowed to the extent indicated. The decision underscores the importance of reasoned decision-making and adherence to principles of natural justice in quasi-judicial functions performed by the Central Government.

← Previous Next →