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2015 (4) TMI 66 - HC - CustomsExtension of the investigation period - Anti-dumping investigations - imports of Cast Aluminium Alloy Wheels originating - whether the ex post facto extension of the investigation period granted by the Central Government on 30.04.2014 extending the period of investigation from 09.03.2014 to 09.06.2014 was valid - Held that - Central Government can grant ex post facto extension provided it is done within the overall period of six months beyond one year and the extension does not spill over beyond the eighteen-month period. We take this view because we do not see any bar or prohibition in the said Rule 17 which would prevent the Central Government from extending the period of investigation even after the initial period of one year or the extended period has expired provided it is granted within the overall period of eighteen months. It is not stipulated in the first proviso to Rule 17(1)(a) that the extension must be granted during the initial period or an extended period. Extension must not be granted within the initial period or extended period, as the case may be, otherwise the investigation will lapse automatically at the end of such period. In our view, at the end of the initial period or an extended period, if the period of eighteen months has not expired, the investigation would, in a sense, be suspended till it is revived by an ex post facto extension within the overall period of eighteen months. In the case of a suspension of investigation under Rule 15, when it is subsequently resumed by the DA, the period for which investigation was kept under suspension shall not be taken into account while calculating the said period of one year. This would not be so where suspension of investigation operates because the extension order from the central government is awaited. The clock, in such a case, would continue to run and the time taken by the Central Government would not be excluded in computing the period of eighteen months. Furthermore, under Rule 15 it is the DA who suspends the investigation, whereas the kind of suspension we are considering is not at the instance of the DA but on the happening of certain events and circumstances. Mr Balbir Singh is right when he contends that the DA, when he made his request for extension on 03.03.2014, could not presume that the Central Government would grant the extension. It is for this reason, that, on 09.03.2014, when the first period of extension expired and the grant of further extension was awaited by the DA, his mandate to investigate got suspended. The DA s mandate was revived on 30.04.2014 when the extension was ultimately granted. It is from that date that the investigation would resume. Ex post facto extension of the investigation period granted by the Central Government on 30.04.2014 extending the period of investigation from 09.03.2014 to 09.06.2014 was valid. Violation of principle of natural justice - Opportunity of hearing not granted - Interested party - Held that - there is no dispute that the petitioners are interested parties. There is also no dispute that all the earlier investigation (including the first oral hearing) was conducted by the earlier DA and not by the DA who took over only on 29.05.2014. In any event, it is an admitted position that the new DA had to afford an opportunity of hearing to interested parties including the petitioners. The Respondents have taken the plea that the new DA had only 12 days to complete the investigation and submit the Final Finding and the manner in which he conducted the proceedings was the best he could do in the short time available. But, we are afraid that this is not good enough. The opportunity of hearing must not be illusory. Just because there was paucity of time (for no fault on the part of the interested parties), the DA cannot ride roughshod over the principles of natural justice. The DA is bound to grant a meaningful opportunity of hearing to the interested parties and written submissions or comments are no substitute for this. This has been settled by the Supreme Court in the ATMA case 2011 (1) TMI 7 - SUPREME COURT OF INDIA . Anti-dumping investigations are time-bound but, that does not mean that such important matters can be bull-dozed in the manner it has been done in the present case. A period of dormancy of 2 months and 18 days (from 09.03.2014 to 28.05.2014) has been followed by a short period of 12 days of frenetic activity which has resulted in principles of natural justice being violated. The hearing granted on 30.05.2014 cannot be regarded as a reasonable opportunity of hearing. Interested parties were informed by email at 6.22 pm on 29.05.2014 that the hearing would be granted at 5 00 p.m. the next day (30.05.2014). Requests by interested parties for giving another date so that they are able to avail of the opportunity was rejected by the DA and, that too, just 20 minutes prior to 5 00 pm on 30.05.2014. The fact that the hearing could be attended by only one exporter is testimony of the lack of reasonable opportunity. Sure, the new DA was in a hurry as he had only 12 days with him but, that does not mean that he could give a go-by to the requirement of affording a reasonable opportunity of hearing to the interested parties before he submitted his Final Finding. In the light of the clear dicta in the ATMA case in the context of anti-dumping investigations, the decisions in Swadeshi Cotton Mills (1981 (1) TMI 250 - SUPREME COURT OF INDIA) would not come to the aid of the respondents. Petitioners, who are interested parties, were not given an adequate opportunity of hearing by the DA before he issued the impugned Final Finding dated 09.06.2014. - Consequently, the impugned Final Finding dated 09.06.2014 having been rendered in violation of the principles of natural justice, cannot be sustained and is quashed - Decided partly in favour of assessee.
Issues Involved:
1. Validity of the ex post facto extension of the investigation period. 2. Adequacy of the opportunity of hearing provided to the petitioners by the Designated Authority. Detailed Analysis: Issue 1: Validity of the Ex Post Facto Extension Arguments by Petitioners: - The investigation initiated on 10.12.2012 was to be completed within one year as per Rule 17(1) of the said Rules, which can be extended by six months under special circumstances. - The Central Government extended the period by three months on 06.12.2013, but the subsequent extension granted on 30.04.2014 was after the expiration of the earlier extended period on 09.03.2014, rendering it illegal and without authority. - Ex post facto extensions could lead to chaos and are not permissible as they disrupt the legal certainty and predictability required in such investigations. Arguments by Respondents: - The extension is an administrative decision based on the exigencies of the case, as held by the Supreme Court in the Haldor Topsoe case. - The request for the second extension was made before the expiration of the first extension, and the Central Government can grant such extensions within the overall limit of 18 months. - There is no stipulation in the said Rules that the extension must be granted before the expiry of the initial period. Court's Analysis: - Rule 17(1) mandates the completion of the investigation within one year, extendable by six months under special circumstances. - The investigation does not lapse automatically at the end of one year if no extension is granted within that period. Instead, it can be suspended until the Central Government grants an ex post facto extension within the overall period of 18 months. - The Central Government's extension granted on 30.04.2014 was within the permissible period and thus valid. Conclusion on Issue 1: The ex post facto extension of the investigation period granted by the Central Government on 30.04.2014 extending the period of investigation from 09.03.2014 to 09.06.2014 was valid. Issue 2: Adequacy of the Opportunity of Hearing Arguments by Petitioners: - The Final Finding was issued in violation of the principles of natural justice as the Designated Authority (DA) did not provide an effective opportunity of hearing. - The DA scheduled an oral hearing on 30.05.2014 with very short notice, making it impractical for interested parties to attend. - Written submissions cannot substitute oral hearings, as held by the Supreme Court in the ATMA case. Arguments by Respondents: - The new DA had only 12 days to conclude the investigation after taking charge on 29.05.2014. - The DA followed the procedure by conducting a second oral hearing and issuing a disclosure statement. - The principles of natural justice were adhered to as much as possible given the time constraints. Court's Analysis: - The Supreme Court in the ATMA case emphasized that the DA must provide a reasonable opportunity of hearing to interested parties. - The new DA's scheduling of the hearing on 30.05.2014 with such short notice did not constitute a reasonable opportunity of hearing. - The DA's actions, driven by time constraints, resulted in a violation of the principles of natural justice. Conclusion on Issue 2: The petitioners, who are interested parties, were not given an adequate opportunity of hearing by the DA before he issued the impugned Final Finding dated 09.06.2014. Conclusion: Consequently, the impugned Final Finding dated 09.06.2014, having been rendered in violation of the principles of natural justice, cannot be sustained and is quashed. The writ petitions are allowed in part to this extent, and the parties are left to bear their own costs.
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