2023 (1) TMI 351 - AT - Customs

Continuation of anti-dumping duty under section 9A of the Customs Tariff Act 1975 - contention that has been advanced is that the office memorandum, communicating the decision of the Central Government not to continue anti-dumping duty, despite a recommendation having been made by the designated authority in the final findings to continue anti-dumping duty should be set aside for the reason that the principles of natural justice have been violated and even otherwise the decision is arbitrary, unreasoned and bad in law - Principles of natural justice. HELD THAT - The Gujarat High Court in Realstripes Limited 1 other(s) vs. Union of India 1 other(s) 2022 (9) TMI 1171 - GUJARAT HIGH COURT also examined whether quasi-judicial process was involved in issuance of the notification by the Central Government and after analyzing the decision of the Supreme Court in Indian National Congress vs. Institute of Social Welfare 2002 (5) TMI 847 - SUPREME COURT , the Gujarat High Court held that the notification issued by the Central Government would be quasi-judicial in nature. The inevitable conclusion, therefore, that follows from the aforesaid discussion is that the decision taken by the Central Government not to impose anti-dumping duty despite a recommendation having been made by the designated authority for imposition of anti-dumping duty, cannot be sustained as it does not contain reasons nor the principles of natural justice have been compiled with and the matter would have to be remitted to the Central Government for taking 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. Non-issuance of notification for continuation of anti-dumping duty by the Central Government despite the designated authority's recommendation.
2. Maintainability of the appeal under section 9C of the Customs Tariff Act.
3. Nature of the Central Government's determination (legislative or quasi-judicial).
4. Compliance with principles of natural justice and requirement of a reasoned order.

Detailed Analysis:

1. Non-issuance of Notification for Continuation of Anti-Dumping Duty:
The appellant, an association of steel producers in India, contended that despite the designated authority's recommendation in the final findings dated 28.10.2021 for the continuation of anti-dumping duty under section 9A of the Customs Tariff Act 1975, the Central Government did not issue the necessary notification. The appellant sought to set aside the office memorandum dated 07.02.2022 from the Ministry of Finance, which conveyed the Central Government's decision not to impose the proposed anti-dumping duty.

The designated authority had conducted a sunset review investigation and concluded that there was a likelihood of continuation or recurrence of dumping and injury to the domestic industry if the duty was revoked. The authority recommended the continuation of anti-dumping duty on imports of wire rod from China PR for five years. Despite this, the Central Government decided against imposing the duty, which led to the appellant's grievance.

2. Maintainability of the Appeal under Section 9C of the Customs Tariff Act:
The appeal's maintainability under section 9C was affirmed by referencing a previous decision (M/s. Apcotex Industries Limited vs. Union of India). It was held that an appeal is maintainable against the Central Government's decision not to impose anti-dumping duty, as communicated in the office memorandum.

3. Nature of the Central Government's Determination (Legislative or Quasi-Judicial):
The Tribunal examined whether the Central Government's determination was legislative or quasi-judicial. It was concluded that the function performed by the Central Government is quasi-judicial. Even if considered legislative, the principles of natural justice and the requirement of a reasoned order must be complied with, as the Central Government performs a form of conditional legislation. This conclusion was supported by the Supreme Court's judgment in State of Tamil Nadu vs. K. Sabanayagam.

4. Compliance with Principles of Natural Justice and Requirement of a Reasoned Order:
It was emphasized that the Central Government must record reasons when deciding not to impose anti-dumping duty despite a positive recommendation from the designated authority. The Tribunal referenced several judgments, including Punjab National Bank and Cynamide India Ltd., to assert that the principles of natural justice require an opportunity for the domestic industry to submit a representation if the Central Government forms a prima facie opinion against imposing the duty.

The Tribunal also cited a Gujarat High Court decision in Realstripes Limited vs. Union of India, which held that the issuance of the notification by the Central Government is quasi-judicial and subject to judicial review.

Conclusion:
The Tribunal concluded that the Central Government's decision not to impose anti-dumping duty, as communicated in the office memorandum dated 07.02.2022, was unsustainable due to the lack of reasons and non-compliance with the principles of natural justice. The matter was remitted to the Central Government for reconsideration in light of the Tribunal's observations. The appeal was allowed to the extent indicated.

Order Pronounced on 20.12.2022.

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