Akil Kureshi, J.@mdashThe petitioner has prayed for issuance of a writ or order in the nature of mandamus directing the Ministry of Finance to accept the recommendations of the Designated Authority issued vide notification dated 20-1-2011, as also to accept the recommendations of the Ministry of Chemicals and Fertilizers and consequently, to issue a notification imposing Anti-dumping duty on the imports of certain goods. Briefly stated facts are as under:
1.1 The petitioner is a Company registered under the Companies Act and is engaged in the business of pharmaceutical industry producing Penicillin-G. The petitioner had filed an application before the Designated Authority ("DA" for short) alleging dumping of Penicillin-G Potassium originating in or exported from China PR and Mexico as also of 6-Amino Penicillin Acid (6-APA for short) originating in or exported from China PR, DA on the basis of such an application of the petitioner, issued a public notice dated 22-7-2009 initiating Anti-dumping duty investigations concerning imports of Penicillin-G and 6-APA to determine the existence, degree and effect of alleged dumping and to recommend the amount of Anti-dumping duty, which, if levied, would be adequate to remove the injury to the domestic industry.
1.2 Following the principles and procedure provided in the Customs Tariff (Identification, Assessment and Collection of Anti-Dumping Duty on Dumped Articles and for Determination of Injury) Rules, 1995 (hereinafter referred to as "the Rules"), the DA issued preliminary findings vide its notification dated 11-1-2010 recommending imposition of provisional Anti-dumping duty concerning imports of Penicillin-G originating in or exported from China PR and Mexico and 6-APA originating in or exported from China PR. The Central Government however, did not impose any such provisional duty despite the recommendations by the DA.
1.3 The DA thereafter, after completing the investigation and hearing all concerned, published its final findings vide notification dated 20-1-2011 holding that there was sufficient justification for imposition of Anti-dumping duty against the imports of said Penicillin-G and 6-APA.
1.4 It is the case of the petitioner that as per Rule 18 of the Rules, Central Government was required to impose Anti-dumping duty in terms of recommendations of DA within three months of the date of publication of final findings. Since the Central Government did not arrive at any decision with regard to the imposition of Anti-dumping duty, the petitioner made representations to the Government of India. Despite which, since no decision was taken the petitioner moved this Court by filing Special Civil Application No. 5078/2011 seeking appropriate directions against the Union of India. In response to the notice issued by this Court, Union of India appeared and filed reply stating inter alia that Union of India has decided not to impose duty and the recommendations of the DA are not accepted. Upon such development, Special Civil Application No. 5078/2011 was disposed of vide order dated 14-6-2011 leaving it open to the petitioner to pursue its remedies as available under the law. Thereupon the petitioner has filed this fresh petition for the prayers noted earlier.
2. In essence, grievance of the petitioner is that despite clear findings by the DA and recommendations for imposition of Anti-dumping duty, Central Government has refused to impose such duty without proper reasons. It is also the case of the petitioner that the Ministry of Chemicals and Fertilizers whose opinion was sought by the Ministry of Finance had also made a strong recommendation for imposition of Anti-dumping duty. Ministry of Chemicals and Fertilizers had outlined its reasons for such recommendations. The Union of India acting through the Ministry of Finance, disregarding the findings and recommendations of DA and also recommendations of Ministry of Fertilizers and Chemicals, without any valid basis refused to impose Anti-dumping duty. This in short is the controversy arising in this petition.
3. We may note that the DA in its final findings had come to the following important conclusions:
Factors establishing causal link and conclusion on causal link for Pen-G and 6APA
111. The Authority conducted an analysis of the performance of the domestic industry vis-a-vis subject goods over the injury period. It is noted that the performance of the domestic industry has materially deteriorated during the injury period. The causal link between dumped imports and the injury to the domestic industry is established on the following grounds:
(i) There is significant correlation between the prices offered by the domestic industry and Foreign Producers from subject country(ies). It is further noted that even when the domestic industry has been offering sub-optimal prices and lowering its prices, it is also losing sales. Thus, decline in sales volumes is a direct consequence of dumped imports from the subject country(ies);
(ii) It is further noted that decline in sales volumes has resulted in reduction in the selling prices. Further, to keep its plant running, it is selling both the subject goods at prices significantly below its cost of production. As a direct consequence, the profits of the domestic industry declined so rapidly that the domestic industry went into a situation of financial losses from a situation of profits;
(iii) It is noted that reduction in profits directly resulted in deterioration in return on capital employed and cash flow. Thus, deterioration in profits, return on capital employed and cash flow is provisionally attributed due to dumped imports of subject goods from subject country(ies).;
(iv) It is also noted that consistent decline in sales volumes has adversely affected the production and capacity utilization. It is noted that decline in production and capacity utilization is due to dumped imports. Therefore, the Authority concludes that the domestic industry has suffered material injury and such injury has been caused significantly by price and volume effects of dumped imports from the subject country(ies).
H Conclusions:
112. After examining the issues raised and submissions made by the interested parties and facts made available before the Authority as recorded in this finding, the Authority concludes that:
(a) The products under consideration (both Pen-G and 6 APA) have been exported to India from the subject country(ies) (China PR and Mexico for Pen-G and China PR for 6 APA respectively) below their normal values.
(b) The domestic industry for both the products under consideration has suffered material injury.
(c) The injury has been caused by the dumped imports of subject goods (Pen-G and 6 APA) from the subject country(ies).
I Indian industry''s interest & other issues
113. The Authority notes that the purpose of anti-dumping duties, in general, is to eliminate injury caused to the Domestic Industry by the unfair trade practices of dumping so as to re-establish a situation of open and fair competition in the Indian market, which is in the general interest of the country. Imposition of anti-dumping measures would not restrict imports from the subject country(ies) in any way, and, therefore, would not affect the availability of the products to the consumers.
114. It is recognized that the imposition of anti-dumping duties might affect the price levels of the products manufactured using the subject goods and consequently might have some influence on relative competitiveness of these products. However, fair competition in the Indian market will not be reduced by the anti-dumping measures, particularly if the levy of the antidumping duty is restricted to an amount necessary to redress the injury to the domestic industry. On the contrary, imposition of anti-dumping measures would remove the unfair advantages gained by dumping practices, would prevent the decline of the domestic industry and help maintain availability of wider choice to the consumers of the subject goods.
J Recommendations
115 The Authority notes that the investigation was initiated and notified to all interested parties and adequate opportunity was given to the exporters, importers and other interested parties to provide positive information on the aspect of dumping, injury and causal link. Having initiated and conducted a investigation into dumping, injury and causal links between dumping and injury to the domestic industry in terms of the Rules laid down and having established positive dumping margin as well as material injury to the domestic industry caused by such dumped imports, the Authority is of the view that imposition of duty is required to offset dumping and injury. Therefore, Authority considers it necessary and recommends imposition of definitive anti-dumping duty on imports of subject goods from the subject countries in the form and manner described hereunder.
116. Having regard to the lesser duty rule followed by the Authority, the Authority recommends imposition of definitive anti-dumping duty equal to the lesser of margin of dumping and margin of injury, so as to remove the injury to the domestic industry. Accordingly, anti-dumping duty equal to the amount indicated in Col. 7 of the table below is recommended to be imposed on all imports of subject goods originating in or exported from the subject countries.
4. In response to the notice issued by us, the Union of India has appeared and on its behalf an affidavit dated 23-9-2011 has been filed opposing the petition and prayers made by the petitioner. It is stated that after publication of the final findings, respondent No. 1 received numerous representations against the imposition of Anti-dumping duty. The issue was examined, particularly with focus on following issues:
Insufficient domestic supply of the subject goods in view of the domestic demand. Domestic industry is not able to meet the demand of more than 8 to 10% of the total requirement.
The likely impact on the price of the formulations in view of the imposition of anti-dumping duty on the subject goods, triggering burden to antibiotic manufacturers.
The interest of the domestic industry in this case two units, M/s. Alembic Limited, Vadodara and M/s. Southern Petrochemical Industries Corporation Ltd. should not outweigh the interest of the bulk drug manufacturers.
Imposition of duty would cause significant disadvantage to the consumer.
Imposition of duty would cause significant increase in price of penicillin-G and 6-APA, which eventually will cause increase in the prices of life saving drugs.
If the anti-dumping duty is levied on penicillin G and the same is not levied on the derivative, viz. 7 ADCA, Cephalexin etc. then the Chinese exporters may export value added APIs to India, resulting into closing of many manufacturing units of antibiotic in India.
There may be shortage in the availability of antibiotic in the country and the prices of finished product may increase, ultimately affecting the common man. Large number of downstream users, mainly SMEs who converts these intermediates into formulations, will-adversely be affected. Imposition of such duty may render the operation of a much larger community of downstream users unviable.
4.1 It is further stated that Penicillin-G being a basic raw material for making antibiotic is covered under the Essential Commodities Act besides being under the Price Control. The imposition of Anti-dumping duty would lead to increase in the price of Penicillin-G and 6-APA and which in turn would lead to increase in prices of medicines. In that view of the matter, requirement of imposition of Anti-dumping duty was not found to be in the public interest. It is further stated that Section 9A of the Customs Tariff Act empowers the Central Government to levy tariff, but does not cast a mandatory obligation to accept the recommendations of the DA and impose Anti-dumping duty even when the larger public interest requires otherwise.
5. Some of the private respondents have also filed their replies and opposed the petition.
6. On the basis of above facts and events, counsel for all the sides have made detailed submissions before us for final disposal of the petition.
7. Senior counsel Shri Deven Parikh appearing with counsel Shri Kunal Nanavati for the petitioner submitted that in view of the conclusions of DA in its final findings, it was not open for the Union of India to reject such findings or refuse to impose Anti-dumping duty. It was contended that discretion if any enjoyed by the Central Government was severely restricted looking to the nature and purpose of Anti-dumping duty and its impact on domestic industry. Counsel submitted that though Rule 18 uses word ''may'', same should be read as ''shall'' in view of the scheme or the provisions for collection of Anti-dumping duty. It was the contention of the counsel that considering the purpose for collection of Anti-dumping duty and the provisions made in this regard, it would emerge that the Legislature casts a certain mandate on the Central Government to impose Anti-dumping duty to remove the injury when DA comes to the conclusion that there is dumping and that such dumping causes injury to the domestic industry. Counsel submitted that the purpose of imposition of Anti-dumping duty is not collection of revenue but to provide a level-playing field and to protect and guard the domestic industry against unfair trade practice. Counsel submitted that when an exporter undercuts the price of its product and sells at a price lower than the cost of manufacturing or sale price in the country of its origin, such practice damages and hampers the domestic industry. A strong case of protection would arise and Central Government cannot claim any discretionary right to act or not to act in such a situation.
In this regard counsel relied on following judgments:
(a)
(b)
(c)
(d)
7.1 In the alternative, counsel submitted that even if there was any discretion with the Union of India not to accept the recommendations of DA, such powers could not be exercised arbitrarily. In the present case the Central Government having proceeded on same factors which were already taken into account by the DA, could not have rejected the recommendations of the DA. Counsel submitted that the DA under the Rules was acting for and on behalf of the Central Government and not as its agency. In that view of the matter, findings recorded by DA were binding to the Central Government. Once it is found that such findings were arrived at on behalf of the Central Government, the recommendations of DA on the basis of such findings could not have been rejected without there being independent or additional factors. Counsel vehemently contended that the Central Government has proceeded on the same factors which were already taken into account by DA to recommend imposition of Antidumping duty. Counsel submitted that the powers exercised by the Central Government are not Legislative and can only at best be described as quasi judicial. In this regard, reliance was placed on the decision of Apex Court in case of
38. We are of the opinion that the nature of the proceedings before the DA are quasi judicial, and it is well-settled that a quasi judicial decision, or even an administrative decision which has civil consequences, must be in accordance with the principles of natural justice, and hence reasons have to be disclosed by the authority in that decision vide S.N. Mukherjee v. Union of India.
39. We do not agree with the Tribunal that the notification of the Central Government u/s 9A is a legislative Act. In our opinion, it is clearly quasi judicial. The proceedings before the DA is to determine the lis between the domestic industry on the one hand and the importer of foreign goods from the foreign supplier on the other. The determination of the recommendation of the DA and the Government notification on its basis is subject to an appeal before the CESTAT. This also makes it clear that the proceedings before the DA are quasi judicial.
In this regard, counsel also drew out attention to decision of the Division Bench of this Court in case of
15. The first and foremost issue is in relation to maintainability of petition at this interim stage. The main challenge is against levy of provisional anti-dumping duty which, inter alia, affects the petitioners. It is true that it is not a stage at which Court could go into validity of preliminary findings/imposition of duty. If final duty is not levied, the petitioners will be entitled to refund of anti-dumping duty already paid and if it is imposed, they could appeal to CESTAT or approach this Court or Hon''ble Supreme Court. The moot question still remains as to whether in a given case, grievance against judicial, quasi judicial or administrative function may itself give rise to cause of action as the very initiation of proceedings under any law or in exercise of public duty aimed at bringing civil consequences for a person against whom such action is initiated, itself becomes cause of action abundantly affecting petitioners'' interests. Mr. Thakore''s argument is that the impugned action of levy of anti-dumping duty is a legislative action which cannot be challenged in a writ petition filed under Articles 226 & 227 of the Constitution of India. This contention cannot be upheld in view of the decision of Apex Court in the case of
7.2 Counsel also relied on decision of Apex Court in case of
36. It is of vital importance to note that in the initial imposition of duty, the appellant has accepted the position that determination of injury by the Designated Authority was proper and in conformity with the requirements of Annexure-O of the Anti-Dumping Rules. The appellant did not challenge the final finding of the Designated Authority before the Tribunal that parameters mentioned in para (iv) of Annexure-U had not been considered or satisfied. We have declined the permission to the appellant to raise this point before us in Civil Appeal Nos. 773 and 774 of 2001 which were directed against the final findings recorded by the Designated Authority based on which the Government of India had imposed the anti-dumping duty for a period of five years. u/s 9A(1), the said initial imposition of anti-dumping duty is ordinarily contemplated to be continued and remain in effect for a full period of five years, at the end of which it would be subject to sunset review, the possible consequence of which would be the extension of the operation of the period of anti-dumping duty for another period of five years. This is subject to the provisions of sub-rule (1) of Rule 23 of the Anti-Dumping Rules, under which the Designated Authority is empowered to review the anti-dumping duty imposed from time to time. Having regard to the scheme of the above-mentioned provisions of the statute, once anti-dumping duty has been initially imposed, it would be ordinarily continued for five years unless on a review it is found by the Designated Authority that there has been such a significant change in the facts and circumstances, that it is considered necessary either to withdraw or modify appropriately the anti-dumping duty which has been imposed. It is, therefore, clear that unless the Designated Authority suo motu or the applicant for review is in a position to establish clearly that there has been a significant change in the facts and circumstances relating to each of the basic requirements or conditions precedent for imposing duty, the finding given by the Designated Authority at the time of initial imposition of antidumping duty must be considered to continue to hold the field.
37. The final findings recorded by the Designated Authority at the time of initial imposition of anti-dumping duty on the existence of injury to the domestic industry must be considered to continue to remain valid, unless it is proved to be otherwise, either by the Designated Authority in suo motu review or by the applicant seeking review. In the present case, the review had been initiated by the Designated Authority. Neither the Designated Authority nor the appellant had placed any material on record which could possibly displace the findings given by the Designated Authority at the stage of initial anti-dumping duty. In the absence of any new material, the Designated Authority is not required to apply afresh all parameters or criteria enumerated in para (iv) of Annexure-II, which had already been done at the initial stage of imposition of anti-dumping duty. There is no material on record to show that there was a change in the parameters or the criteria relating to the injury which would warrant withdrawal of anti-dumping duty. Nevertheless, the Designated Authority has still analysed the issue of injury in detail in the Mid Term Review findings and has considered all the criteria or parameters enumerated in Annexure-II. There is, therefore, no merit or substance in the appellant''s contention regarding non-compliance with Annexure-II.
7.3 Counsel submitted that imposition of Anti-dumping duty does not prohibit imports. It only eliminates artificial price undercutting. In this regard he relied on decision in case of Reliance Industries Ltd. (supra), wherein it is observed that the purpose of Section 9A of the Customs Tariff Act is to maintain a level playing field and prevent dumping while allowing for healthy competition. The purpose is not protectionism in the classical sense but to prevent unfair trade practices. The Apex Court observed as under:
9. After India became independent in 1947, the Government of Independent India headed by Prime Minister Jawahar Lal Nehru decided to industrialize India as it was realized that the country cannot escape from poverty, unemployment and other social evils unless there is industrialization. It was also known to them that a country cannot be really independent in modern times unless it is industrialized. Hence, the Industrial Policy Resolution was adopted by the Indian Government in the early 1950s and encouragement was given to the growth of heavy industry and other industries so that India may become economically independent and a prosperous nation.
10. The result was that an industrial base was created in India after independence and this has definitely resulted in some progress. The purpose of Section 9A can, therefore, easily be seen. The purpose was that our industries which had been built up after independence with great difficulties must not be allowed to be destroyed by unfair competition of some foreign companies. Dumping is a well-known method of unfair competition which is adopted by the foreign companies. This is done by selling goods at a very low price for some time so that the domestic industries cannot compete and are thereby destroyed, and after such destruction has taken place, prices are again raised.
11. The purpose of Section 9A is, therefore, to maintain a level-playing field and prevent dumping, while allowing for healthy competition. The purpose is not protectionism in the classical sense (as proposed by the German economist Friedrich List in his famous book ''National System of Political Economy'' published in 1841) but to prevent unfair trade practices. The 1995 Amendment to Section 9A was apparently made in pursuance to Article VI of the General Agreement on Tariffs and Trade 1994 (GATT 1994) which permitted anti-dumping measures as an instrument of fair competition.
12. The concept of anti-dumping is founded on the basis that a foreign manufacturer sells below the normal value in order to destabilize domestic manufacturers. Dumping, in the short term, may give some transitory benefits to the local customers on account of lower priced goods, but in the long run destroys the local industries and may have a drastic effect on prices in the long run.
18. Learned counsel Shri Hriday such appearing for the Union of India opposed the petition. Relying on the affidavit in reply filed on behalf of the Respondent No. 1 and the other materials at his command, he submitted that Rule 18 of the Rules only uses the expression ''may''. The Central Government, therefore, has discretionary powers to impose or not to impose Anti-dumping duty even when it is so recommended by the DA. He submitted that the recommendations of DA are not binding.
8.1 Counsel submitted that DA is primarily concerned with ascertainment of dumping if any, causal link of such dumping on domestic industry and margin of injury. While examining the recommendations of DA, Central Government has to take into account various other factors of public interest. If in a given set of facts, it is found that despite the occasion of dumping, duty is not to be imposed, such decision cannot be stated to be arbitrary.
8.2 Counsel submitted that the imposition of Anti-dumping duty by Central Government is a legislative action. No mandate therefore, can be issued for imposition of any such duty. In this regard, counsel relied on the decision of the Apex Court in case of
52. The levy or non-levy of anti-dumping or other duty being a legislative act pursuant to the exercise of powers under the Customs Tariff Act can also not be a subject-matter of judicial review by the MRTP Commission.
53. It is thus seen that the provisions relating to anti-dumping contained in the Customs Tariff Act do not in any way affect the power or jurisdiction of the MRTP Commission. The Import Control Act and the Customs Tariff Act on the one hand and the MRTP Act on the other operate in different independent fields and the authority under one has no jurisdiction over the other. In other words, their paths do not cross each other. While the provisions of Anti-dumping Act are concerned with the levy of anti-dumping duty, the MRTP Act in the present case would be concerned with the agreements between the parties which relate to the restrictive trade practices. Therefore, it would be incorrect to say that the incorporation of the anti-dumping provisions ousts the jurisdiction of the MRTP Commission to inquire and pass orders, inter alia, with regard to restrictive trade practice in India.
8.3 He submitted that the Apex Court in case of Reliance Industries Ltd. (supra) did not notice earlier decision of three Judge Bench in case of Haridas Exports (supra). Counsel drew our attention to subsequent decision of the Apex Court in case of
8.4 Counsel relied on decision of the Apex Court in case of
8.5 Counsel also relied on decision of Division Bench of this Court in case of
8.6 Counsel also relied on decision in case of
8.7 Counsel also relied on decision of the Rajasthan High Court in case of
183. We shall presently notice that merely finding by the Designated Authority the fact leading to conclusion that a case of dumping and specific injury in domestic industry is made out by itself, does not obligate the Central Government to levy any anti-dumping duties as a matter of course. But the decision of the Central Government to impose Anti-Dumping Duty after it receives the findings and the recommended rate which would remove the injury to the domestic industry is still governed by number of other considerations on which the Central Government alone has to decide.
9. Learned counsel Shri Seetharaman appearing for Respondent No. 10 also opposed the petition contending that it is not mandatory on the Central Government to impose Anti-dumping duty. The Rules only make enabling provision for such purpose. Counsel submitted that imposition of Anti-dumping duty is legislative in nature. No direction therefore, can be issued to the Central Government for framing of law. Counsel submitted that our country has accepted enabling regime. He therefore, submitted that in Rule 18 what is provided is the enabling provision allowing Central Government to impose Anti-dumping duty. There is no mandate that in every case, where recommendation is made by DA, such duty must follow.
9.1 Reliance was placed on decision of the Apex Court in case of Reliance Industries Ltd. (supra). Counsel submitted that the three Bench Judgment in case of Haridas Exports (supra) was not noticed. Counsel pointed out that in case of Automotive Tyre Manufacturers Asson. (supra), the Apex Court noted this divergence of opinion between the earlier Bench. However, in facts of the case, said aspect was not required to be gone into.
9.2 In support of his contention that Court cannot give direction for framing of law, Counsel relied on following decisions:
(a) S. Muthukrishnan v. The Government of Tamil Nadu in Writ Petition No. 16939/2001 wherein it was held that:
4. In Prabhandhak Samtii case, notification was already issued by the Governor exercising the power under Article 348(2) of the Constitution of India authorising the usage of Hindi in Devnagri script in the High Court of Allahabad. In Narendrakumar v. Rajasthan High Court, a distinction was drawn between Article 344 and 348 of Constitution of India. We are not facing such a situation as arisen either in the case cited first supra or second supra. As already stated above, Article 348(2) of the Constitution of India enables the Governor of a State, to authorise the use of the Hindi language or any other language in addition to English even in the High Court, and if such enabling provision is exercised, it may be that the language other than English can be put to use. But in the absence of any such notification, nobody can demand to exercise such power to issue such notification. It is for the authorities empowered under Article 348(2) of the Constitution of India to exercise such power and it is well settled law that the High Court will not legislate the matter and issue such a direction as sought for in this writ petition, for exercise of such power, which is legislative in nature. We therefore dismiss the writ petition.
(b)
7. Simla was a part of Punjab till reorganization of Punjab in 1966. Simla and two other Districts of the former State of Punjab were added on to the Union Territory of Himachal Pradesh under the Punjab Reorganization Act, 1966. Under the Provisions of that Act, the laws in force, immediately before the appointed day namely October 1, 1966, in those districts were to continue in operation till the appropriate legislature or competent authority altered the same. One of the laws that was in force in those areas is the Punjab General Sales Tax Act, 1948. Section 6(1) of that Act provides:
No tax shall be payable on the sale of goods specified in the first column of Schedule B subject to the conditions and exceptions, if any, set out in the corresponding entry in the second column thereof and no dealer shall charge sales tax on the sale of goods which are declared tax free under this section.
Till August 31,1966, Indian made foreign liquor was in Schedule B. But on that date the Government of Punjab in exercise of its powers conferred under proviso to s. 5 deleted Indian made foreign liquor from Schedule B and included the same in Schedule A to that Act. Thus the sale of the said liquor became exigible to sales tax. This was the law in force in Punjab when reorganization took place. Hence Simla and other areas which were formerly parts of the State of undivided Punjab continued to be governed by that law even after reorganization. Our attention has not been drawn to any provision in that Act empowering the Government to exempt any assessee from payment of tax. Therefore it is clear that appellant was liable to pay the tax imposed under the law. What the appellant really wants is I mandate from the Court to the competent authority to delete the concerned entry from Schedule A and include the same, in Schedule B. We shall not go into the question whether the Government of Himachal Pradesh on its own authority was competent to make the alteration in question or not. We shall assume for our present purpose that it had such a power. The power to impose a tax is undoubtedly a legislative power; That power can be exercised by the legislature directly or subject to certain conditions, the legislature may delegate that power to some other authority. But the exercise of that power, whether by the legislature or by its delegate is an exercise of a legislative power. The fact that the power was delegated to the executive does not convert that power into an executive or administrative power. No court can issue a mandate to a legislature to enact a particular law. Similarly no court can direct a subordinate legislative body to enact or not to enact a law which it may be competent to enact. The relief as framed by the appellant in his writ petition does not bring out the real issue calling for determination. In reality he wants this Court to direct the Government to delete the entry in question from Schedule A and include the same in Schedule B. Art. 265 of the Constitution lays down that no tax can be levied and collected except by authority of law. Hence the levy of a tax can only be done by the authority of law and not by any executive order unless the executive is specifically empowered by law to give any exemption, it cannot say that it will not enforce the law as against a particular person. No court can give a direction to a Government to refrain from enforcing a provision of law. Under these circumstances, we must hold that the relief asked for by the appellant cannot be granted.
(c) Counsel also relied on decision of Rajasthan High Court in case of J.K. Industries Ltd. (supra) for the same purpose.
10. Having thus heard learned counsel for the parties and having perused the documents on record, we may notice that there is greater deal of controversy about the nature of powers exercised by the Central Government in relation to Anti-dumping duty. Before us, counsel also debated the question of nature of powers and duties exercised by the DA under the Rules. To our mind, two aspects are distinct and separate. We would be taking note of different statutory provisions contained in the Customs Tariff Act and the Rules to ascertain the nature of duties cast on DA and powers enjoyed by him and the nature and character of the powers of the Central Government while deciding whether to impose Anti-dumping duty. We would be deliberating on whether the findings and recommendations of the DA are binding to the Union of India and also whether the act of Union of India of imposition of Anti-dumping duty can be stated to be a legislative function.
11. First taking the question of duties and powers of DA, we note that Section 9A of the Customs Tariff Act, which was introduced by the amendment of 1995, makes provision with respect to Anti-dumping duty on dumped articles. Section 9A reads as under:
9A. (1) Where any article is exported from any country or territory (hereafter in this section referred to as the exporting country or territory) to India at less than its normal value, then, upon the importation of such article into India, the Central Government may, by notification in the -Official Gazette, impose an anti-dumping duty not exceeding the margin of dumping in relation to such article.
Explanation.--For the purposes of this section, -
(a) "margin of dumping" in relation to an article, means the difference between its export price and its normal value;
(b) "export price", in relation to an article, means the price of the article exported from the exporting country or territory and in cases where there is no export price or where the export price is unreliable because of association or a compensatory arrangement between the exporter and the importer or a third party, the export price may be constructed on the basis of the price at which the imported articles are first resold to an independent buyer or if the article is not resold to an independent buyer, or not resold in the condition as imported, on such reasonable basis as may be determined in accordance with the rules made under sub-section (6);
(c) "normal value", in relation to an article, means -
(i) the comparable price, in the ordinary course of trade, for the like article when destined* for consumption in the exporting country or territory as determined in accordance with the rules made under sub-section (6); or
(ii) when there are no sales of the like article in the ordinary course of trade in the domestic market of the exporting country or territory, or when because of the particular market situation or low volume of the sales in the domestic market of the exporting country or territory, such sales do not permit a proper comparison, the normal value shall be either -
(a) comparable representative price of the like article when exported from the exporting country or territory to an appropriate third country as determined in accordance with the rules made under sub-section (6); or
(b) the cost of production of the said article in the country of origin along with reasonable addition for administrative, selling and general costs, and for profits, as determined in accordance with the rules made under sub-section (6):
Provided that in the case of import of the article from a country other than the country of origin and where the article has been merely transhipped through the country of export or such article is not produced in the country of export or there is no comparable price in the country of export, the normal value shall be determined with reference to its price in the country of origin.
(2) The Central Government may, pending the determination in accordance with the provisions of this section and the rules made thereunder of the normal value and. the margin of dumping in relation to any article, impose on the importation of such article into India an anti-dumping duty on the basis of a provisional estimate of such value and margin and if such anti-dumping duty exceeds the margin as so determined, -
(a) the Central Government shall, having regard to such determination and as soon as may be after such determination, reduce such anti-dumping duty; and
(b) refund shall be made of so much of the anti-dumping duty which has been collected as is in excess of the anti-dumping duty as so reduced.
(2A) Notwithstanding anything contained in sub-section (1) and subsection (2), a notification issued under sub-section (1) or any anti-dumping duty imposed under sub-section (2), shall not apply to articles imported by a hundred per cent export oriented undertaking unless, -
(i) specifically made applicable in such notification or such imposition, as the case may be, or
(ii) the article imported is either cleared as such into the domestic tariff area or used in the manufacture of any goods that are cleared into the domestic tariff area, and in such cases anti-dumping duty shall be levied on that portion of the article so cleared or so used as was leviable when it was imported into India.
Explanation.--For the purposes of this section, the expressions "hundred per cent export-oriented undertaking", "free trade zone" and "special economic zone" shall have the meanings assigned to them in Explanation 2 to subsection (f) of section 3 of Central Excise Act, 1944.
(3) If the Central Government, in respect of the dumped article under inquiry, is of the opinion that -
(i) there is a history of dumping which caused injury or that the importer was, or should have been, aware that the exporter practices dumping and that such dumping would cause injury; and
(ii) the injury is caused by massive dumping of an article imported in a relatively short time which in the light of the timing and the volume of imported article dumped and other circumstances is likely to seriously undermine the remedial effect of the antidumping duty liable to be levied,
the Central Government may, by notification in the Official Gazette, levy anti-dumping duty retrospectively from a date prior to the date of imposition of anti-dumping duty under sub-section (2) but not beyond ninety days from the date of notification under that sub-section, and notwithstanding anything contained in any other law for the time being in force, such duty shall be payable at such rate and from such date as may be specified in the notification.
(4) The anti-dumping duty chargeable under this section shall be in addition to any other duty imposed under this Act or under any other law for the time being in force.
(5) The anti-dumping duty imposed under this section shall, unless revoked earlier, cease to have effect on the expiry of five years from the date of such imposition:
Provided that if the Central Government, in a review, is of the opinion that the cessation of such duty is likely to lead to continuation or recurrence of dumping and injury, it may, from time to time, extend the period of such imposition for a further period of five years and such further period shall commence from the date of order of such extension:
Provided further that where a review initiated before the expiry of the aforesaid period of five years has not come to a conclusion before such expiry, the anti-dumping duty may continue to remain in force pending the outcome of such a review for a further period not exceeding one year.
(6) The margin of dumping as referred to in sub-section (1) or sub-section (2) shall, from time to time, be ascertained and determined by the Central Government, after such inquiry as it may consider necessary and the Central Government may, by notification in the Official Gazette, make rules for the purposes of this section, and without prejudice to the generality of the foregoing such rules may provide for the manner in which articles liable for any anti-dumping duty under this section may be identified and for the manner in which the export price and the normal value of and the margin refund of anti-dumping duty in certain cases of dumping in relation to, such articles may be determined and for the assessment and collection of such anti-dumping duty.
(6A) The margin of dumping in relation to an article, exported by an exporter or producer, under inquiry under sub-section (6) shall be determined on the basis of records concerning normal value and export price maintained, and information provided by such exporter or producer;
(7) Every notification issued under this section shall, as soon as may be after it is issued, be laid before each House of Parliament.
(8) The provisions of the Customs Act, 1962 and the rules and regulations made thereunder, relating to, the date for determination of rate of duty, non-levy, short levy, refunds, interest, appeals, offences and penalties shall, as far as may be, apply to the duty chargeable under this section as they apply in relation to duties leviable under that Act.
Section 9C of the Customs Tariff Act provides for appeal against the order of determination or review thereof regarding the existence, degree and effect of any subsidy or dumping in relation to import of any article. Such appeal lies before the Customs, Excise and Service Tax Appellate Tribunal constituted u/s 129 of the Customs Act, 1962. Section 9C reads as under:
9C(1) An appeal against the order of determination or review thereof regarding the existence, degree and effect of any subsidy or dumping in relation to import of any article shall lie to the Customs, Excise and Service Tax Appellate Tribunal constituted u/s 129 of the Customs Act, 1962 (hereafter referred to as the Appellate Tribunal).
[(1A) An appeal under sub-section (1) shall be accompanied by a fee of fifteen thousand rupees.
(1B) Every application made before the Appellate Tribunal, -
(a) in an appeal under sub-section (1), for grant of stay or for rectification of mistake or for any other purpose; or
(b) for restoration of an appeal or an application, shall be accompanied by a fee of five hundred rupees.]
(2) Every appeal under this section shall be filed within ninety days of the date of order under appeal:
Provided that the Appellate Tribunal may entertain any appeal after the expiry of the said period of ninety days, if it is satisfied that the appellant was prevented by sufficient cause from filing the appeal in time.
(3) The Appellate Tribunal may, after giving the parties to the appeal an opportunity of being heard, pass such order thereon as it thinks fit, confirming, modifying or annulling the order appealed against.
(4) The provisions of sub-section (1), (2), (5) and (6) of section 129C of the Customs Act, 1962 shall apply to the Appellate Tribunal in the discharge of its functions under this Act as they apply to it in the discharge of its functions under the Customs Act, 1962.
(5) Every appeal under sub-section (1) shall be heard by a Special Bench constituted by the President of the Appellate Tribunal for hearing such appeals and such Bench shall consist of the President and not less than two members and shall include one judicial member and one technical member.
12. In exercise of powers under sub-section (6) of Section 9A and subsection (2) of Section 9B of the Customs Tariff Act, the Union of India has promulgated Customs Tariff (Identification, Assessment and Collection of Antidumping duty on Dumped Articles and for Determination of Injury) Rules, 1985. Rule 2(c) of the Rules define term "interested party" as under:
(c) "interested party" includes -
(i) an exporter or a foreign producer or the importer of an article subject to investigation for being dumped in India, or a trader or business association a majority of the members of which are producers, exporters or importers of such an article;
(ii) the Government of the exporting country; and
(iii) a producer of- the like article in India or a trade and business association a majority of the members of which produce the like article in India;
Rule 3 pertains to appointment of designated authority and reads as under:
RULE 3. Appointment of designated authority.--(1) The Central Government may, by notification in the Official Gazette, appoint a person not below the rank of a joint Secretary to the Government of India or such other person as that Government may think fit as the designated authority for purposes of these rules.
(2) The Central Government may provide to the designated authority the services of such other persons and such other facilities as it deems fit."
Rule 4 pertains to duties of the designated authority and reads as under:
RULE 4. Duties of the designated authority.--(1) It shall be the duty of the designated authority in accordance with these rules -
(a) to investigate as to the existence, degree and effect of any alleged dumping in relation to import of any article;
(b) to identify the article liable for anti-dumping duty;
(c) to submit its findings, provisional or otherwise to Central Government as to-
(i) normal value, export price and the margin of dumping in relation to the article under investigation, and
(ii) the injury or threat of injury to an industry established in India or material retardation to the establishment of an industry in India consequent upon the import of such article from the specified countries.
(d) to recommend the amount of anti-dumping duty equal to the margin of dumping or less, which if levied, would remove the injury to the domestic industry, and the date of commencement of such duty; and
(e) to review the need for continuance of anti-dumping duty."
Rule 5 pertains to initiation of investigation and provides inter alia that DA shall initiate an investigation to determine the existence, degree and effect of any alleged dumping only upon receipt of a written application by or on behalf of the domestic industry except for the goods covered under sub-rule (4) which permits the DA to initiate such investigation suo motu.
Rule 6 of the Rules pertain to principles governing such investigation and reads as under:
RULE 6. Principles governing investigations.--(1) The designated authority shall, after it has decided to initiate investigation to determine the existence, degree and effect of any alleged dumping of any article, issue a public notice notifying its decision and such public notice shall, inter alia, contain adequate information on the following:--
(i) the name of the exporting country or countries and the article involved;
(ii) the date of initiation of the investigation;
(iii) the basis on which dumping is alleged in the application;
(iv) a summary of the factors on which the allegation of injury is based;
(v) the address to which representations by interested parties should be directed; and
(vi) the time-limits allowed to interested parties for making their views known.
(2) A copy of the public notice shall be forwarded by the designated authority to the known exporters of the article alleged to have been dumped, the Governments of the exporting countries concerned and other interested parties.
(3) The designated authority shall also provide a copy of the application referred to in sub-rule (1) of Rule 5 to--
(i) the known exporters or to the concerned trade association where the number of exporters is large, and
(ii) the governments of the exporting countries:
Provided that the designated authority shall also make available a copy of the application to any other interested party who makes a request therefor in writing.
(4) The designated authority may issue a notice calling for any information, in such form as may be specified by it, from the exporters, foreign producers and other interested parties and such information shall be furnished by such persons in writing within thirty days from the date of receipt of the notice or within such extended period as the designated authority may allow on sufficient cause being shown.
Explanation.--For the purpose of this sub-rule, the notice calling for information and other documents shall be deemed to have been received one week from the date on which it was sent by the designated authority or transmitted to the appropriate diplomatic representative of the exporting country.
(5) The designated authority shall also provide opportunity to the industrial users of the article under investigation, and to representative consumer organizations in cases where the article is commonly sold at the retail level, to furnish information which is relevant to the investigation regarding dumping, injury where applicable, and causality.
(6) The designated authority may allow an interested party or its representative to present the information relevant to the investigation orally but such oral information shall be taken into consideration by the designated authority only when it is subsequently reproduced in writing.
(7) The designated authority shall make available the evidence presented to it by one interested party to the other interested parties, participating in the investigation.
(8) In a case where an interested party refuses access to, or otherwise does not provide necessary information within a reasonable period, or significantly impedes the investigation, the designated authority may record its findings on the basis of the facts available to it and make such recommendations to the Central Government as it deems fit under such circumstances.
Rule 10 pertains to determination of normal value, export price and margin of dumping and reads as under:
RULE 10. Determination of normal value, export price and margin of dumping.--An article shall be considered as being dumped if it is exported from a country or territory to India at a price less than its normal value and in such circumstances the designated authority shall determine the normal value, export price and the margin of dumping taking into account, inter alia, the principles laid down in Annexure 1 to these rules."
Rule 11 pertains to determination of injury and reads as under:
RULE 11; Determination of injury.--(1) In the case of imports from specified countries, the designated authority shall record a further finding that import of such article into India causes or threatens material injury to any established industry in India or materially retards the establishment of any industry in India."
Rule 12 pertains to publication of preliminary findings.
Rule 13 empowers the Central Government to impose a provisional duty on the basis of preliminary findings of DA.
Rule 14 pertains to termination of investigation and reads as under:
RULE 14. Termination of investigation.--The designated authority shall, by issue of a public notice, terminate an investigation immediately if -
(a) it receives a request in writing for doing so from or on behalf of the domestic industry affected, at whose instance the investigation was initiated;
(b) it is satisfied in the course of an investigation, that there is not sufficient evidence of dumping or, where applicable, injury to justify the continuation of the investigation;
(c) it determines that the margin of dumping is less than two per cent of the export price;
(d) it determines that the volume of the dumped imports, actual or potential, from a particular country accounts for less than three per cent of the imports of the like product, unless, the countries which individually account for less than three per cent of the imports of the like product, collectively account for more than seven per cent of the import of the like product; or
(e) it determines that the injury where applicable, is negligible.
Rule 15 pertains to suspension or termination of investigation upon undertaking with respect to price being revised under sub-rule (1) thereon and reads as under:
RULE 15. Suspension or termination of investigation on price undertaking.--(1) The designated authority may suspend or terminate an investigation if the exporter of the article in question, -
(i) furnishes an undertaking in writing to the designated authority to revise the prices so that no exports of the said article are made to India at dumped prices, or
(ii) in the case of imports from specified countries undertake to revise the prices so that injurious effect of dumping is eliminated and the designated authority is satisfied that the injurious effect of the dumping is eliminated:
Provided further that the designated authority shall complete the investigation and record its finding, if the exporter so desires, or it so decides.
(2) No undertaking as regards price increase under clause (ii) of the sub-rule (1) shall be accepted from any exporter unless the designated authority had made preliminary determination of dumping and the injury,
(3) The designated authority may, also not accept undertakings offered by any exporter, if it considers that acceptance of such undertaking is impractical or is unacceptable for any other reason.
(4) The designated authority shall intimate the acceptance of an undertaking and suspension or termination of investigation to the Central Government and also issue a public notice in this regard. The public notice shall, contain inter alia, the non-confidential part of the undertaking.
(5) In cases where an undertaking has been accepted by the designated authority the Central Government may not impose a duty under sub-section (2) of section 9A of the Act for such period the undertaking acceptable to the designated authority remains valid.
(6) Where the designated authority has accepted any undertaking under sub-rule (1), it may require the exporter from whom such undertaking has been accepted to provide from time to time information relevant to the fulfilment of the undertaking and to permit verification of relevant data:
Provided that in case of any violation of an undertaking, the designated authority shall, as soon as may be possible, inform the Central Government of the violation of the undertaking and recommend imposition of provisional duty from the date of such violation in accordance with the provisions of these rules.
(7) The designated authority shall, suo motu or on the basis of any request received from exporters or importers of the article in question or any other interested party, review from time to time the need for the continuance of any undertaking given earlier.
Rule 17 pertains to final findings that may be published by DA and reads as under:
Final findings.--(1) The designated authority shall, within one year from the date of initiation of an investigation, determine as to whether or not the article under investigation is being dumped in India and submit to the Central Government its final finding -
(a) as to, -
(i) he export price, normal value and the margin of dumping of the said article;
(ii) whether import of the said article into India, in the case of imports from specified countries, causes or threatens material injury to any industry established in India or materially retards the establishment of any industry in India;
(iii) a causal link, where applicable, between the dumped imports and injury;
(iv) whether a retrospective levy is called for and if so, the reasons therefor and date of commencement of such retrospective levy:
Provided that the Central Government may, in its discretion in special circumstances extend further the aforesaid period of one year by six months:
Provided further that in those cases where the designated authority has suspended the investigation on the acceptance of a price undertaking as provided in rule 15 and subsequently resumes the same on violation of the terms of the said undertaking, the period for which investigation was kept under suspension shall not be taken into account while calculating the period of said one year,
(b) recommending the amount of duty which, if levied, would remove the injury where applicable, to the domestic industry.
(2) The final finding, if affirmative, shall contain all information on the matter of facts and law and reasons which have led to the conclusion and shall also contain information regarding -
(i) the names of the suppliers, or when this is impracticable, the supplying countries involved;
(ii) a description of the product which is sufficient for customs purposes;
(iii) the margins of dumping established and a hill explanation of the reasons for the methodology used in the establishment and comparison of the export price and the normal value;
(iv) Considerations relevant to the injury determination; and
(v) the main reasons leading to the determination.
(3) The designated authority shall determine an individual margin of dumping for each known exporter or producer concerned of the article under investigation:
Provided that in cases where the number of exporters, producers, importers or types of articles involved are so large as to make such determination impracticable, it may limit its findings either to a reasonable number of interested parties or articles by using statistically valid samples based on information available at the time of selection, or to the largest percentage of the volume of the exports from the country in question which can reasonably be investigated, and any selection, of exporters, producers, or types of articles, made under this proviso shall preferably be made in consultation with and with the consent of the exporters, producers or importers concerned : Provided further that the designated authority shall determine an individual margin of dumping for any exporter or producer, though not selected initially, who submit necessary information in time, except where the number of exporters or producers are so large that individual examination would be unduly burdensome and prevent the timely completion of the investigation.
(4) The designated authority shall issue a public notice recording its final findings.
Rule 18 pertains to levy of duty and reads as under:
RULE 18. Levy of duty.--(1) The Central Government may, within three months of the date of publication of final findings by the designated authority under rule 17, impose by notification in the Official Gazette, upon importation into India of the article covered by the final finding, anti-dumping duty not exceeding the margin of dumping as determined under rule 17.
(2) In cases where the designated authority has selected percentage of the volume of the exports from a particular country, as referred to sub-rule (3) of rule 17, any anti-dumping duty applied to imports from exporters or producers not included in the examination shall not exceed -
(i) the weighted average margin of dumping established with respect to the selected exporters or producers or,
(ii) where the liability for payment of anti-dumping duties is calculated on the basis of a prospective normal value/the difference between the weighted average normal value of the selected exporters or producers and the export prices of exporters or producers not individually examined:
Provided that the Central Government shall disregard for the purpose of this sub-rule any zero margin, margins which are less than 2 per cent expressed as the percentage of export price and margins established in the circumstances detailed in sub-rule (8) of rule 6. The Central Government shall apply individual duties to imports from any exporter or producer not included in the examination who has provided the necessary information during the course of the investigation as referred to in the second proviso to sub-rule (3) of rule 17.
(3) Notwithstanding anything contained in sub-rule (1), where a domestic industry has been interpreted according to the proviso to sub-clause (b) of rule 2, a duty shall be levied only after the exporters have been given opportunity to cease exporting at dumped prices to the area concerned or otherwise give an undertaking pursuant to rule 15 and such undertaking has not been promptly given and in such cases duty shall not be levied only on the articles of specific producers which supply the area in question.
(4) If the final finding of the designated authority is negative that is contrary to the evidence on whose basis the investigation was initiated, the Central Government shall, within forty-five days of the publication of final findings by the designated authority under rule 17, withdraw the provisional duty imposed, if any.
Rule 23 pertains to review by DA regarding the need for the continued imposition of the Anti-dumping duty and reads as under:
23. Review.--(1) The designated authority shall, from time to time, review the need for the continued imposition of the anti-dumping duty and shall, if it is satisfied on the basis of information received by it that there is no justification for the continued imposition of such duty recommend to the Central Government for its withdrawal.
(2) Any review initiated under sub-rule (1) shall be concluded within a period not exceeding twelve months from the date of initiation of such review.
(3) The provisions of rules 6, 7, 8, 9/10, 11, 16, 17, 18, 19, and 20 shall be mutatis mutandis applicable in the case of review.
13. From the above statutory provisions, it can be seen that sub-section (1) of Section 9A empowers the Central Government by issuing notification in the Official Gazette to impose Anti-dumping duty not exceeding the margin of dumping when it is found that any article is exported to India at less than its normal value.
Explanation to sub-section (1) explains various terms such as margin of dumping, export price and normal value.
Sub-section (4) of Section 9A provides that Anti-dumping duty shall be in addition to any other duty imposed under the Act.
Sub-section (5) of Section 9A provides that such imposition of Antidumping duty shall remain effective for a period of five years unless revoked earlier. Proviso to sub-section (5) however, empowers the Central Government to extend such period from time to time for a further period of five years.
Sub-section (6) of Section 9A provides that margin of dumping shall be ascertained and determined by the Central Government after such inquiry as it may consider necessary u/s 9A of the Customs Tariff Act. Thus the power to impose Anti-dumping duty lies with the Central Government even when the margin of dumping required to be ascertained is to be determined by the Central Government in rune with the Rules that may be framed in this regard.
In essence, therefore, various parameters for ascertaining the question of dumping such as assessment of normal value of an article, margin of dumping and assessment and collection of Anti-dumping duty, are functions to be performed by the Central Government u/s 9A of the Customs Tariff Act.
14. Rule 3 of the Rules pertain to appointment of DA.
Rule 4 prescribes duties of the DA under which DA has to investigate as to the existence, degree and effect of any alleged dumping in relation to import of any article and to identify the article liable for anti-dumping duty. DA has to submit its findings provisional or otherwise as to normal value, export price and the margin of dumping in relation to article under investigation and injury or threat of injury to an industry established in India or material retardation to the establishment of an industry in India consequent upon the import of such article. Clause (d) of sub-rule (1) of Rule 5 requires the DA to recommend the amount of Anti-dumping duty equal to the margin of dumping or less, which if levied, would remove the injury to the domestic industry and also the date of commencement of such duty.
15. Thus the essential question of ascertaining various factors leading to final conclusion on the question of dumping are performed by DA appointed under Rule 3 of the Rules, as specified in Rule 4 of the Rules. It can thus be seen that functions performed by the DA are for and on behalf of the Central Government and not as an agency appointed by the Government either delegated or vested with powers to do so. In essence therefore, DA while performing such functions acts on behalf of the Central Government.
16. The above conclusion gets further support from various Rules vesting vast powers in DA. For example, in Rule 5, the DA has to initiate investigation on receipt of a written application on behalf of a domestic industry alleging dumping. Such investigation is to be carried out to determine existence, degree and effect of such alleged dumping. Sub-rule (4) of Rule 5 even permits the DA to initiate such investigation suo motu under certain circumstances.
� Rule 14 empowers the DA to terminate the investigation under certain circumstances, such as upon receipt of request in writing on behalf of domestic industry at whose instance the investigation was initiated or if it is satisfied in the course of an investigation that there is no sufficient evidence of dumping or injury to the industry justify the continuation of the investigation.
� Rule 15 authorises the DA to suspend or terminate the investigation, if the exporter gives undertaking in writing to revise the prices so that no exports of the articles are made at dumped prices or to revise the price so that injurious effect of dumping is eliminated.
� Rule 23 requires the DA from time to time to review the need for continued imposition of the Anti-dumping duty.
17. Thus while undertaking investigation into the question of dumping, DA not only ascertains various factors such as normal value of article, margin of dumping, injury or threat to the domestic industry etc. but also enjoys independent powers to either terminate the investigation or suspend the investigation under certain circumstances. Such decisions of the DA are not subject to further Government approval or control.
18. Combined effect of such statutory provisions would convince us to come to the conclusion that DA under Rule 3 of the Rules acts for and on behalf of the Government while carrying out the investigation to determine the existence, degree and effect of any alleged dumping. In that view of the matter, the findings of DA with respect to such issues may not be open to question by the Central Government. However, in our opinion this is not the same thing as to suggest that even the recommendations of DA are binding on the Central Government. This aspect we would discuss at a later stage.
19. At this stage, we would like to dwell at some length on the question of nature of powers exercised by the Central Government.
20. As noted earlier, in case of Haridas Exports (supra), three Judge Bench of the Apex Court observed that levy or non-levy of anti-dumping or other duty being a legislative act pursuant to the exercise of powers under the Customs Tariff Act cannot be a subject-matter of judicial review by the MRTP Commission. These observations cannot be seen as a mere passing remark as suggested by the Counsel for the petitioner. It is of course true that case on hand before the Apex Court did not pertain to imposition or otherwise of Antidumping duty. However, the Apex Court was examining whether in view of the provisions contained in the Customs Tariff Act and Rules made therein, the Monopolies and Restrictive Trade Practices Commission could be stated to have been divested of its jurisdiction to examine the complaints of unfair trade practice in relation to Indonesian manufacturer who was allegedly indulging in heavy under-invoicing in association with its Indian importers. It was in this background while examining the provisions contained in MRTP Act and Customs Tariff Act, and holding that provisions contained in Customs Tariff Act would not oust jurisdiction of MRTP Commission, above noted observations were made.
21. Decision in case of Haridas Exports (supra) was not noticed by the Apex Court in subsequent two Judge Bench decision in case of Reliance Industries Ltd. (supra). It is of course true that unmindful of observations made in case of Haridas Exports (supra), the Apex Court in case of Reliance Industries Ltd. (supra) did disagree with the findings of Tribunal that the notification of the Central Government u/s 9A is a legislative act. It was observed that such was clearly quasi judicial in nature. These observations however, must be seen in light of the earlier observations of the Bench when they opined that nature of proceedings before DA are quasi judicial. It was in this background that the Apex Court disagreed with the view of the Tribunal with respect to character of notification issued by Central Government u/s 9A of the Act.
22. In case of Meghani Organics Ltd. and Am. (supra), this Court followed the Apex Court decision in case of Reliance Industries Ltd. (supra). It was however, the case where the petitioner had prayed for direction to quash the Anti-dumping duty proceedings initiated by the DA. The respondents had argued that act of the Government is legislative in character and writ petition therefore, would not lie. Question before the Court that came up for consideration was whether the proceedings before the DA are quasi judicial in nature. It was in this background that the Court relied on and referred to the decision of the Apex Court in case of Reliance Industries Ltd. (supra). This decision of Gujarat High Court therefore, cannot be seen as laying down the proposition mat Central Government while issuing notification u/s 9A exercises quasi judicial functions.
23. We have already noticed that the divergence of opinion between the decision of the Apex Court in case of Reliance Industries Ltd. (supra) and in case of Haridas Exports (supra) was noticed by Apex Court in case of Automotive Tyre Manufacturers Asson. (supra). However, the Apex Court did not find it necessary to conclude this issue. It was observed:
48. Thus, the first and foremost question for adjudication is the nature of proceedings before the DA appointed by the Central Government under Rule 3 of the 1995 Rules for conducting investigations for the purpose of levy of anti-dumping duty in terms of Section 9A of the Act. To put it differently, the question is whether the decision of the DA is legislative, administrative or quasi judicial in character? However, for the purpose of the present case, we shall confine our discussion only to the question as to whether the function of the DA is administrative or quasi judicial in character as Mr. Rawal, learned counsel appearing for the DA had finally conceded before us that it is not legislative in nature.
24. We may notice that Division Bench of Rajasthan High Court in case of J. K. Industries Ltd. (supra) held that the Central Government exercises legislative function and observed as under:
142. The nature of delegation legislation as is contemplated u/s 9A squarely falls in the category of conditional delegation of legislative function which depends not on subjective satisfaction of the delegate but depends on objective facts to be reached before the power can be exercised. As per the principle enunciated in
147. Applying this test to the present case, it can be said that so far as the relief relates to prohibiting or preventing the Central Government from exercising its legislative function by issue of any writ contemplated under Article 226 is concerned, cannot be said to be ripe for consideration, unless the required Notification is issued and is sought to be implemented by the authorities concerned for levy and collecting Anti-dumping Duty imposed by such Notification.
25. It is true that decision of Supreme Court in case of Reliance Industries Ltd. (supra) was not available before the Rajasthan High Court.
26. Independently of the above various observations and pronouncements, we prima facie find it more attractive to accept the contention that the Central Government while issuing notification imposing Anti-dumping duty u/s 9A of the Act exercises legislative functions. In essence, by issuance of notification, what is sought to be done is collection of duty. It is true that such duty is not imposed for revenue collection, nevertheless, it partakes the character of compulsory extraction of tax. Whatever be the purpose, it still essentially is in nature of duty. We may recall that Article 265 of the Constitution provides that no tax shall be levied or collected except by authority of law. Any argument that Notification imposing Anti-dumping duty is not a piece of legislation may open a contention that very collection of such duty is without authority of law. We may also notice that u/s 9A of the Customs Tariff Act, an appeal is provided against order of determination or review regarding the existence, degree and effect of any subsidy or dumping in relation to import of any article. Essentially therefore, what would be in appeal under sub-section (1) of Section 9C would be the order of determination or review of effect of any dumping and not the notification issued by the Central Government. Of course, if the notification is based on any determination which is found to be erroneous, the imposition of duty may fail on that count. This is not the same thing as to suggest that before the Tribunal decision of the Central Government of issuance of notification of imposition of Anti-dumping duty would be at large. If the functions of the Central Government is held to be a legislative function, as is well settled, no writ could be issued to enact a law. In the present petition, however, we are not inclined to come to any final opinion on this issue. Observations made above therefore, may not be understood as our final opinion on the issue.
27. For the purpose of the present petition, however, we are inclined to accept the version of the petitioner that such powers are quasi judicial in nature and that therefore, writ petition would be maintainable. Question however, is whether in the facts of the case, interference is called for. This would bring us to two questions. Firstly, whether the recommendations of DA are binding on the Central Government and secondly, if not, whether the Central Government had sufficient reasons to exercise its discretion and refuse to impose Anti-dumping duty, despite strong recommendations by the DA and support from the Ministry of Chemicals and Fertilizers.
28. Firstly, as already noticed, sub-rule (1) of Rule 4 provides for various duties of DA. Besides other duties, clause (d) of sub-rule (1) of Rule 4 requires the DA to recommend amount of Anti-dumping duty which would be equal to the margin of dumping or less which if levied, would remove the injury to the domestic industry. We are of the opinion that recommendations of DA under clause (d) of sub-rule (1) of Rule 4 are binding on the Central Government. We say so because unlike, as already noticed, various other functions performed by DA while carrying out his duties under sub-rule (1) of Rule 4, which are of independent character and performed for and on behalf of the Government, clause (d) provides for recommendation to be made to the Central Government. If such conclusion of DA with respect to Anti-dumping duty was meant to be binding, there was no need to use word ''recommend'' in clause (d) of sub-rule (1) of Rule 4.
29. Further, sub-rule (1) of Rule 18 of the Rules provides that Central Government may within three months of the date of publication of final findings by the DA under Rule 17, impose by notification in Official Gazette, Antidumping duty not exceeding margin of dumping as determined in Rule 17.
30. Sub-rule (1) of Rule 18 uses word ''may''. Unless there are sufficient reasons, it would not be possible for us to read the word ''may'' as ''shall''. In comparison to this provision, we may recall that sub-rule (4) of Rule 17 provides that if final finding of the DA is negative, the Central Government shall withdraw the provisional duty if imposed. Thus in such a situation, legislature had left no option - no discretion to the Central Government but to act in accordance with the final findings of the DA and withdraw provisional duty if imposed. Secondly, the Rules give discretion to the Government even while deciding to impose Antidumping duty to impose such amount of duty not exceeding the margin of dumping. In other words even if Central Government were to accept the recommendations of DA for imposition of Anti-dumping duty, the extent of such Antidumping duty need not necessarily be as recommended by DA. Thirdly, the task to be performed by DA under the said Rules and particularly, while performing duties specified in Rule 4 are specific, to ascertain existence, degree and effect of any alleged dumping and various factors connected therewith. Number of other questions of larger public interest such as possible impact of Anti-dumping duty on other industries, on consumption, on supply, etc. of such articles may not possibly be within the purview of DA while carrying out investigation envisaged under the Rules. It can however, not be stated that the Central Government should be oblivious of all such factors and once through mathematical exercise, task of ascertaining extent of dumping and causal injury to the domestic industry is completed, necessarily to such extent, Anti-dumping duty must follow. Any such proposition would be putting the Central Government into too straitjacket a situation wherein on a mere ascertainment of dumping and its impact on domestic industry, the Government in all cases invariably be bound to impose duty irrespective of fact that such imposition may for valid reasons found to be not in public interest.
31. As already noticed, several Courts have opined that the recommendations of the DA are not binding on the Government. In case of Saurashtra Chemicals Ltd. (supra), Apex Court has taken such a view. This decision was followed in case of Association of Synthetic Fibre Industry (supra). Rajasthan High Court in case of J.K. Industries Ltd. (supra) observed as under:
183. We shall presently notice that merely finding by the Designated Authority the facts leading to conclusion that a case of dumping and specific injury in domestic industry is made out by itself, does not obligate the Central Government to levy anti-dumping duties as a matter of course. But the decision of the Central Government to impose Anti-Dumping Duty after it receives the findings and the recommended rate which would remove the injury to the domestic industry is still governed by number of other considerations on which the Central Government alone has to decide.
186. The expression used under Rule 13 enabling the Central Government to exercise its power of imposing a Provisional Duty is couched in enabling manner as the expression ''may'' has been used, communicating that issue of a public notice on preliminary finding by the Designated Authority does not mean necessarily that the Central Government shall impose a Provisional Duty as a matter of course. It operates as a safeguard against subjective imposition of Provisional Duty envisaged in sub-section (2) of Section 9A read with the rules and ensure that no such Provisional Duty can be imposed before the expiry of 60 days from the date of public notice issued by the Designated Authority regarding its decision to investigate which itself is founded on due application of his mind to matters detailed in Rule 5. It also ensures that the imposition of Provisional Duty may not continue indefinitely to render the investigation an empty formality by ordaining that the Provisional Duty can remain in force only for a period of 6 months in the first instance but which may upon request of the exporters representing the percentage of the trade involved be extended by the Central Government maximum up to 9 months. Beyond 9 months from the date it is first imposed, Provisional Duty cannot be continued.
187. Effect of final findings recorded under Rule 17 is in the like manner no different. The recording of finding by the Designated Authority does not result in automatic levy and imposition of Anti-Dumping Duty u/s 9A nor it becomes imperative for the Central Government to impose such Duty as recommended by the Designated Authority. The matter again rests with the Central Government which is the delegate of the Parliament to impose in given circumstances Anti-Dumping Duty not exceeding the margin of dumping.
Similar view is also taken by the Delhi High Court in case of Deepak Fertilizers and Petrochem (supra). This Court also in case of Surefaces Plus (supra), was of the opinion that preliminary findings by DA are recommendatory in nature.
32. Such being the legal position, we would have to deal with second question namely, whether the Central Government had sufficient reasons not to impose duty despite recommendations made by the DA. We have already noticed the conclusions of DA while recommending Anti-dumping duty. Insofar as question of dumping/its margin and its impact on domestic industry are concerned, there is no dispute. Question is, despite such findings, was it open for the Central Government to refuse to impose the Anti-dumping duty. The reasons for such decision have been briefly stated in the affidavit in reply to which we have referred to in the earlier portion of the judgment. The Central Government was of the opinion that there was insufficient domestic supply of the subject goods keeping in mind the domestic demand. Domestic industry was not able to meet with such demand. Likely impact on the price of the formulations in view of the imposition of Anti-dumping duty on the subject goods, triggering burden to antibiotic manufacturers, was also required to be taken into account. It was found that imposition of duty would cause significant disadvantage to the consumer and such exercise would increase price of Penicillin-G and 6-APA which eventually would increase prices of life saving drugs.
33. In addition to above statements made in the affidavit in reply, we have also perused the extract or file notings leading to such decision by the Central Government. Such notings were perused by the respective learned advocates for the parties also. While considering question of provision of Anti-dumping duty, through his note on 5-1-2010, Under Secretary to the Ministry of Finance raised following issues:
11. Regarding the issues raised relating to modalities of anti-dumping investigation the DA has already replied via letter dated 17th March, 2010 (refer para 5). However, the following issues raised remain unaddressed:
Insufficient domestic supply of the subject goods in view of the domestic demand.
The likely impact on the price of the formulations in view of the imposition of anti-dumping duty on the subject goods, triggering burden to antibiotic manufacturers.
The interest of the domestic industry in this case two units, M/s. Alembic Limited, Vadodara and M/s. Southern Petrochemical Industries Corporation Ltd. should not outweigh the interest of the bulk drug manufacturers.
The global recession has caused downward performance of the two units instead of the alleged dumping of the products.
12. Penicillin is the basic raw material for many antibiotics and is covered under Essential Commodities Act besides being under Price Control. It has been stated in the representations that imposition of the proposed antidumping duties which works out to 38% and 52% increase in the price of Penicillin and 6-APA respectively would lead to increase in prices of medicines by more than 100%. The DA has also not ruled out the likely increase on the prices of the products on account of imposition of anti-dumping duty of Penicillin and 6-APA in his findings [para 51(a) refers]. Further while the total capacity of manufacture of Penicillin by the domestic industry is 4872 thousand BU, the demand is for 15365 thousand BU. In the case of 6-APA, the total capacity of manufacture of 6-APA by the domestic industry is 600 thousand BU, against the demand of 4931 thousand BU.
13. In view of fact that formulations of penicillin are basic antibiotics and the fact that user industry may face difficulties to cope with the additional burden, particularly in view of the insufficient domestic supply of the subject goods, it is proposed that we may seek opinion from Department of Pharmaceutical, Ministry of Chemicals & Fertilizers about the imposition of anti-dumping duty on the subject goods."
The Joint Secretary on 13-4-2010 made further notings:
2. In this case provisional anti-dumping duty has been recommended by the Designated Authority (DA) on Penicillin-G and 6-APA both of which are drug intermediates for the manufacture of basic antibiotics. As pointed out in the notings of US (TRU), dated 5-4-2010, the issues raised by several domestic manufacturers of the final drugs using these intermediates regarding the legal infirmities in the findings have been satisfactorily explained by the DA. As such, the findings are acceptable from a legal standpoint.
3. However, unlike other case of anti-dumping, this case involves an important issue of public interest owing to the peculiarity of facts. There are only two domestic manufacturers of the drug intermediates on which anti-dumping duty has been recommended. They are able to meet just about 12% of the combined domestic demand. In other words, as much as 88% of the demand is fulfilled through imports. Another factor that is relevant is that while the manufacturers of these items are only two, there is a large number of downstream users -- mainly units in the SME sector who convert these intermediates into formulations. The impositions of antidumping duty to protect two manufacturers from injury is likely to adversely affect and may be even render unviable the operations of a much larger community of downstream users. Moreover, as stated above, both Penicillin-G and 6-APA constitute inputs for the manufacture of very basic antibiotics that are used for the treatment of pneumonia, diphtheria and meningitis etc. The formulations manufactured from these are subject to price control by the National Pharmaceutical Pricing Authority (NPPA) because of their large-scale use in providing low cost medical care. The imposition of anti-dumping duty at the proposed rates is bound to increase the cost and hence retail price of these basic drugs.
4. Section 9A of the Customs Tariff Act, which empowers the Central Government to levy anti-dumping duty, does not, per se, refer to public interest. At the same time the Central Government is not placed under a mandatory obligation to accept the recommendation of the DA and impose anti-dumping duty even when the large public interest dictates otherwise. In the past, in the case of newsprint too a conscious decision was taken not to impose anti-dumping duty despite a clear cut finding about the existence of dumping, injury to the domestic industry and a causal link between the two as is the case here.
5. In view of the facts explained about and taking into account all factors, in my opinion it is not advisable to accept the recommendation of DA in this case. Thus, it is proposed not to levy provisional anti-dumping duty on Penicillin-G and 6-APA when imported from China PR and Mexico.
6. The proposal in para 5 above may please be approved.
This proposal was approved by the Finance Ministry making following observations:
I agree with US (TRU). As pointed out by him, there are large considerations to be kept in view and it would not be advisable to levy anti-dumping duty.
34. Thereupon, the final decision was taken and the Central Government refusing to impose provisional duty, upon DA submitting his final findings, entire issue was considered by the Central Government. One Prashant Kumar Jha, Officer on Special Duty in his notings dated 10-3-2011 after taking detailed note of the final findings of the DA and his recommendations, noted as under:
6. Findings and observations of the DA on the points raised by the various parties
(a) Like article : In terms of Rule 2(d), defining "like article" for both the domestic like products separately, it is noted by DA that there is no known difference in subject goods produced by the Indian industry and exported from subject country(ies). The subject goods produced by the Indian industry and that imported from subject country(ies) are comparable in terms of characteristics such as physical & chemical characteristics, manufacturing process & technology, functions & uses, product specifications, pricing, distribution & marketing and tariff classification of the goods. The two are technically and commercially substitutable. The consumers are using the two interchangeably. In view of the above, subject goods produced by the petitioner companies are being treated as domestic like articles to the subject goods imported from subject country(ies) in accordance with the anti-dumping Rules.
(b) Combining two products in one application : The DA has noted that neither the Agreement nor the Anti-dumping Rules prohibits in any manner investigation of multiple products in one investigation as long as standing, like product, domestic industry status, dumping and injury investigations are carried out in respect of individual products separately. Thus, there is no explicit restriction in the Agreement to limit the investigation to single product as has been argued by the interested parties.
(c) Domestic Industry : The interested parties have questioned the basis of treating the two petitioner as the domestic industry in view of the fact that they account for only 10% of the total domestic production of the 6 APA, whereas DSM Anti Infectives produces more than 80% of the same. The DA has considered claims of the interested parties on this account. While giving reference to Rule 2(b), the DA has noted that in the instant case, DSM Anti Infectives is the producer of 6-APA in India. However, the company has itself imported significant 6-APA from the subject country. Further, the company is related to exporter of 6-APA in China. Thus, the producer is related to exporter and the related company is itself an importer of the subject goods in India. With this significant import from subject country along with the fact that they are related to exporter from subject country, it is considered appropriate not to consider their claim for being domestic industry in the subject investigations. Hence, having regard to the provisions under Rule 2(b) and the facts on record, the DA has held that M/s. DSM Anti-Infectives cannot be considered as eligible domestic producer and its production is required to be excluded for the purpose of determination of domestic industry. The DA has therefore, held that production of Alembic commands a major proportion in Indian production. Alembic Ltd. therefore constitutes domestic industry in respect of 6-APA within the meaning of the Rules.
(d) On the issue of likely increase in prices of subject goods and downstream goods following the imposition of duty, it is noted that imposition of anti-dumping duty might have some impact on the prices of the product. However, fair competition will not be reduced as a result of imposition of anti-dumping duty. The Authority has further noted the claim of the domestic industry that selling prices of Penicillin-G cannot exceed the limits laid down by the Government of India.
(e) As regards the argument that imposition of anti-dumping duties would lead to intensified competition between the Indian and Chinese Pharma industry, the DA has noted that the argument is fully unsubstantiated and irrelevant to the present investigation.
* * * *
(h) With regard to evidence of price adjustment and level of trade in determining dumping margin, it is noted that the petition contained information best available to petitioners. The DA has, however, now adopted information after due verification of information submitted by the exporters and other interested parties in determining dumping margins. It is noted that the petition filed by the domestic industry contained information about causal link analysis. Further, the petitioner claimed that none of the other factors have caused injury to the domestic industry. The DA has analyzed the causal link and other factors in the relevant heading in injury and causal link after due verification of the data of interested parties.
(i) As regards the argument of investigation period, the DA has noted that POI has been chosen at the time of initiation based on pricing behaviour of the subject goods from subject countries and also based on reasons given by the applicants in their petition. It is noted that six months POI for anti-dumping investigations is within the anti-dumping rules and Agreement on anti-dumping. The six months POI was accepted by the DA after examining domestic industry''s data, fluctuation in the prices of the subject goods and also keeping in view the earlier anti-dumping investigations initiated against the same product.
(j) Many interested parties opposing antidumping duty have commented with regard to supply demand gap of both Pen-G, K and 6-APA. The Authority has examined the contention of all interested parties and after examination, it is noted that anti-dumping measures do not seek to restrict or ban imports but seek to set up a level playing field for all interested parties including domestic producers and exporters from subject countries.
7. After the publication of the final findings, this office has received numerous representations including VIP references against the imposition of anti-dumping duty on the subject goods as under:
(i) Representation dated 11-1-2011 and 22-2-2011 from Bulk Drug Manufacturers Association (India).
(ii) Representation dated 11-1-2011 from Virchow Petrochemical Private Limited.
(iii) Representation dated 12-1-2011 from Otsuka Chemical (India) Pvt. Limited.
(iv) Representation dated 20-1-2011 from Unimark Remedies Ltd.
(v) Representation dated 24-1-2011 from Alembic, the petitioner.
(vi) Letter dated 15-2-2011 from Mr. Anantha Venkatarmai Reddy, M.P.
(vii) Letter dated 18-2-2011 from Mr. Brijbhushan Sharan Singh, M.P.
(viii) Representation dated 15-2-2011 Lakshmi Kumaran & Sridharan.
8. The points raised by the various parties are in consonance with their stand taken before the Designated Authority and can be broadly summarized as under:
(i) Technical/legal lacuna in anti-dumping investigation or modalities of anti-dumping investigation.
(ii) Insufficient domestic production to meet demands of penicillin G and 6-APA.
(iii) Additional cost burden on the user Bulk Drug Manufacturers which would be passed to formulation/medicine manufacturers.
9. The matter has been examined. It may also be recalled that the provisional findings were not accepted by the Central Government in the larger public interest (Page 2-14n/s.). Even under the final findings, such concerns which are still germane to our decision of accepting or otherwise of the final findings have remained unaddressed. They are as under:
Insufficient domestic supply of the subject goods in view of the domestic demand. Domestic industry is not able to meet the demand of more than 8 to 10% of the total requirement.
The likely impact on the price of the formulations in view of the imposition of anti-dumping duty on the subject goods, triggering burden to antibiotic manufactures.
The interest of the domestic industry in this case two units, M/s. Alembic Limited, Vadodara and M/s. Southern Petrochemical Industries Corporation Ltd. should not outweigh the interest of the bulk drug manufacturers.
Imposition of duty would cause significant disadvantage to the consumer.
Imposition of duty would cause significant increase in price of penicillin-G and 6-APA, which eventually will cause increase in the prices of life saving drugs.
If the anti-dumping duty is levied on penicillin-G and the same is not levied on the derivative, viz. 7 ADCA, Cephalexin etc. then the Chinese Exporters may export value added APIs to India, resulting into closing of many manufacturing unit of antibiotic in India.
There may be shortage in the availability of antibiotic in the country and the prices of finished product may increase, ultimately affecting the common man.
Large number of downstream users, mainly SMEs who converts these intermediates into formulations, will adversely be affected. Imposition of such duty may render the operation of a much larger community of downstream users unviable.
10.1 Penicillin is the basic raw material for many antibiotics and is covered under Essential Commodities Act besides being under Price Control. It has been stated in the representations that imposition of the proposed antidumping duties which works out to 38% and 52% increase in the price of Penicillin and 6-APA respectively would lead to increase in prices of medicines by more than 100%. The DA has also not ruled out the likely increase on the prices of the products on account of imposition of anti-dumping duty on Penicillin and 6-APA in his findings.
10.2 In this regard while the total capacity of manufacture of Penicillin by the domestic industry is 4872 thousand BU, the demand is for 15365 thousand BU. In the case of 6-APA, the total capacity of manufacture of 6-APA by the domestic industry is 600 thousand BU, against the demand of 4931 thousand BU.
11. Hence, in the present case, the requirement of imposition of antidumping duty does not hold ground on the touchstone of larger public interest. Hence in view of the facts and circumstances mentioned at Paras 9 to 10 above, it is proposed not to accept the final findings of the DA.
This was weighted by various authorities such as Secretary (Revenue) and others before the same was placed before the Hon''ble Finance Minister for approval. Such approval was granted on 29-3-2011. Accordingly once again a draft letter was placed for approval on 3-5-2011 and ultimately final decision was taken.
From the above, it can be seen that the Central Government after taking note of relevant factors decided that it would not be in public interest to impose Anti-dumping duty despite the recommendations made by the DA.
35. We are conscious that DA had come to certain conclusions which were not disputed by the Central Government. Insofar as factual findings are concerned, such findings were perhaps not even open to challenge by the Central Government. We are also conscious that the Ministry of Finance had made Reference to the Ministry of Chemicals and Fertilizers to opine on the issue of imposition or otherwise of Anti-dumping duty. Such Ministry had made a strong case of imposition of duty. One of the grounds was that Public Sector Undertaking i.e. HLL could be revived if such duty is imposed and much of the need of the domestic market can be supplied. We are also conscious of the contention of the counsel for the petitioner that on the very same ground on which the DA recommended imposition of Anti-dumping duty, Central Government could not have refused to do so. We are also conscious of the contention that the Courts have observed that imposition of Anti-dumping duty may have temporary adversary impact on certain factors, which will not be grounds for interfering with such decisions. However, in the present case, we are of the opinion that the Central Government has taken into consideration various factors and come to the conclusion that it is not in public interest to impose Anti-dumping duty. Such factors are additional and besides those taken into account by DA for recommending Anti-dumping duty. As noted earlier, task of DA is limited of ascertainment of various factors such as factum of dumping if at all, ascertainment of extent of dumping, injury to the domestic market and amount of dumping duty in his opinion would eliminate injury. These are issues which necessarily would be governed by material that may be brought on record and ascertainment of relevant factors on basis of facts presented. DA while examining these issues would not be involved in ascertaining other consequences of imposition or otherwise of Anti-dumping duty. It is necessarily the task of the Central Government to ascertain such factors and to come to conclusion whether despite such recommendations, Anti-dumping duty should be imposed or not.
36. When such issues of great complexities are involved, Courts have always shown restrain and permitted greater latitude to the Executive in implementation of its policies, particularly, in fiscal and economic areas. In case of
39. We should not be understood to have meant that the judiciary should never interfere with administrative decisions. However, such interference should be only within narrow limits e.g. when there is clear violation of the statute or a constitutional provision, or there is arbitrariness in the Wednesbury sense. It is the administrators and legislators who are entitled to frame policies and take such administrative decisions as they think necessary in the public interest. The Court should not ordinarily interfere with policy decisions, unless clearly illegal.
40. Economic and fiscal regulatory measures are a field where Judges should encroach upon very warily as Judges are not experts in these matters. The impugned policy parameters were fixed by experts in the Central Government, and it is not ordinarily open to this Court to sit in appeal over the decisions of these experts. We have not been shown any violation of law in the impugned notification or Press Note.
41. The power to lay policy by executive decisions or by legislation includes power to withdraw the same unless it is by mala fide exercise of power, or the decision or action taken is in abuse of power. The doctrine of legitimate expectation plays no role when the appropriate authority is empowered to take a decision by an executive policy or under law. The court leaves the authority to decide its full range of choice within the executive or legislative power. In matters of economic policy, it is settled law that the court gives a large leeway to the executive and the legislature. Granting licences for import or export is an executive or legislative policy. The Government would take diverse factors for formulating the policy in the overall larger interest of the economy of the country. When the Government is satisfied that change in the policy was necessary in the public interest it would be entitled to revise the policy and lay down a new policy.
45. In our opinion there should be judicial restraint in fiscal and economic regulatory measures. The State should not be hampered by the Court in such measures unless they are clearly illegal or unconstitutional. All administrative decisions in the economic and social spheres are essentially ad hoc and experimental. Since economic matters are extremely complicated this inevitably entails special treatment for distinct social phenomena. The State must therefore be left with wide latitude in devising ways and means of imposing fiscal regulatory measures, and the Court should not, unless compelled by the statute or by the Constitution, encroach into this field.
46. In our opinion, it will make no difference whether the policy has been framed by the legislature or the executive and in either case there should be judicial restraint. The Court can invalidate an executive policy only when it is clearly violative of some provisions of the Statute or Constitution or is shockingly arbitrary but not otherwise.
37. Under the circumstances, we are of the view that prayers made in the petition cannot be accepted. Petition therefore, fails. Same is dismissed. In view of order passed in main matter, Civil Application stands dismissed.
1 Paragraph number as per certified copy.
