Pt South Pacific Viscose vs Designated Authority Directorate ... on 19 May, 2022

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Custom, Excise & Service Tax Tribunal

Pt South Pacific Viscose vs Designated Authority Directorate ... on 19 May, 2022

15. Accordingly we allow these appeals by remand to the DA for affording post-decisional hearing to the appellants and for making such modifications to the final findings as may be necessary as a result of such post- decisional hearing. The respondent-domestic industry and other interested parties, if any, shall also be allowed to participate in such post-decisional hearing. Any modifications made in the final findings would be considered by giving effect to the same by the Government by carrying out the necessary amendments to the impugned notifications imposing anti-dumping duty. This process shall be completed within 6 months from the date of this order and status quo shall be maintained meanwhile. Since we are allowing these appeals by remand, the related stay petitions, MAs and COs stand disposed off."

(emphasis supplied)

4. It needs to be noted that the contention that was raised by the appellants before the Tribunal was that the designated authority had violated the principles of natural justice in as much as while the public hearing was conducted by a particular officer as the designated authority, the final findings were recorded by another officer as the designated authority. For this contention, reliance was placed on the judgment of the Supreme Court in Automotive Tyre 5 Manufacturers Asson. vs. Designated Authority . This contention was accepted and the Tribunal remanded the matter to the designated authority for giving a post-decisional hearing with certain observations that have been noted above.

5. On 10.04.2012, pursuant to the aforesaid directions issued by the Tribunal, the designated authority confirmed the findings earlier arrived at on 17.05.2010. The relevant portions of the final findings dated 10.04.2012 of the designated authority, pursuant to the remand order, are as follows:

5. 2011 (263) E.L.T. 481 (S.C.) 6 AD/50571/2022 "In pursuance of the Hon'ble Tribunal (CESTAT's) Final order No. AD/31-51/2011- AD dated 11th August, 2011, a Post-decisional hearing was held on 14th December, 2011 on the captioned subject, wherein the interested parties that had participated in the instant investigation were requested to participate.

2. Upon conclusion of the said hearing, the interested parties that had made their oral submissions were advised to file the written submissions within the stipulated time as per the AD Rules. They were also advised to file the rejoinders thereafter.

3. The written submissions and rejoinders filed by the interested parties, to the extent considered relevant, have been duly considered in this order. Submissions made by interested parties have been examined by the Authority as follows:

*******

253. Having given opportunity in terms of the orders of Hon'ble CESTAT to all the parties to make oral as well as written submissions, the Authority has examined the same in the paras given above. After having examined the submissions of all the parties, the Authority confirms the conclusions arrived at earlier and indicated in the final findings dated 17th May 2010.

254. The Authority therefore confirms its earlier recommendation of imposition of the definitive anti-

dumping duties on the subject goods from the date of notification issued in this regard by the Central Government on all imports of the subject goods originating in or exported from the subject countries. The Authority further concludes that no change to the relevant Government of India, Ministry of Finance's Notification is warranted."

(emphasis supplied)

6. A sunset review investigation was, however, initiated on 22.07.2015 before the expiry of five years from the date of issuance of the notification dated 26.07.2010 and the Central Government issued a notification dated 08.08.2016, on the basis of the final 7 AD/50571/2022 findings dated 08.07.2016 of the designated authority, extending the anti-dumping duties for another period of five years.

7. Prior to this, a notification dated 06.08.2015 had been issued by the Central Government extending the anti-dumping duty till 25.07.2016 as the proceedings before the designated authority were not likely to conclude before 25.07.2015, which was the date when the period of five years would expire when counted from 26.07.2010.

8. This notification dated 08.08.2016 issued by the Central Government imposing anti-dumping duty for a period of five years and the final findings dated 08.07.2016 were challenged by the appellant before the Madras High Court in Writ Petition No. 42644 of 2016 filed on 28.11.2016. On 09.10.2020 this Writ Petition was dismissed as withdrawn with liberty to the petitioner to file an appeal before the Tribunal and the relevant portion of the judgment of the Madras High Court is reproduced below:

"2. The Petitioner challenges the notification in File No.15/9/2015 - DGAD dated 08.07.2016 issued by the Second Respondent and consequent Customs Notification No.43/2016-Customs dated 08.08.2016 issued by the First Respondent.

3. When it is pointed out by Learned Counsel appearing for the First and Second Respondents that the Petitioner has got an effective alternative remedy to challenge the impugned order by way of appeal before the Customs, Excise and Service Tax Appellate Tribunal under Section 9-C of the Customs Tariff Act, 1975, Learned Counsel for the Petitioner seeks permission of this Court to withdraw the Writ Petition with liberty to resort to the aforesaid procedure. He has also filed a memo dated

09.10.2020 to that effect through e-mail, which is placed on record.

4. The Writ Petition is dismissed as withdrawn granting such liberty. It is made clear for the purpose of reckoning limitation for availing aforesaid remedy, the period from the 8 AD/50571/2022 date of filing of this Writ Petition, viz., 30.11.2016, till the date on which certified copy of this order is made ready, shall be excluded. Consequently, the connected Miscellaneous Petitions are closed. No costs."

(emphasis supplied)

9. This appeal was thereafter filed before the Tribunal on 10.11.2020 with a delay condonation application. The delay condonation application was allowed by order dated 14.02.2022 and with the consent of the parties the appeal was also heard.

10. Shri Jitender Singh, learned counsel for the appellant assisted by Shri Sharad Bhansali, Shri Akshay Soni and Shri Jinendra Singhvi pointed out:

(i) The notification dated 26.07.10, which imposed anti-dumping duty on imports of the subject goods for a period of five years, stood impliedly quashed by the Tribunal on 11.08.2011 since a direction was issued to the designated authority to give a post-decisional hearing and make modification in the earlier final findings, if considered necessary, but after the issuance of the findings by the designated authority on 10.04.2012, a fresh notification had not been issued by the Central Government to give effect to the findings. Thus, for a period from 11.08.2011 upto 05.08.2015, there was a gap in imposition of anti-dumping duty of about three years, eleven months and twenty five days since it is only on 06.08.2015 that a notification had been issued by the Central Government extending the anti-dumping duty for a period of one year upto 25.07.2016;

(ii) If it is assumed that the notification dated 26.07.2010 imposing anti-dumping duty for a period of five years had not been set aside, then too there was a gap of eleven days between 26.07.2015 and 05.08.2015; and 9 AD/50571/2022

(iii) In terms of the notification dated 06.08.2015, the anti-

dumping duty was to continue upto 25.07.2016 and it is only by a notification dated 08.08.2016 that anti-dumping duty was continued for a period of five years. Thus, there was a gap of thirteen days between 26.07.2016 and 07.08.2016.

11. On the basis of the aforesaid facts, learned counsel for the appellant made the following submissions:

(i) Once the Tribunal in Allied Enterprises on 11.08.2011 had, while adjudicating upon the legality of the final findings dated 17.05.2010 and the notification dated 26.07.2010, remanded the matter to the designated authority for affording post-

decisional hearing, the notification dated 26.07.2010 and the final findings dated 17.05.2010 impliedly stood quashed;

(ii) Consequent to the aforesaid directions of the Tribunal, the designated authority gave final findings on 10.04.2012 confirming the earlier final findings dated 17.05.2010, but the Central Government did not issue any notification to accept the final findings dated 10.04.2012. Anti-dumping duty, therefore, could not have been imposed on the basis of such findings;

(iii) The power to extend the period of duty under section 9A(5) of the Tariff Act could only have been exercised during the life of the duty and any gap invalidates the continuation of duty. Thus, if the notification dated 26.07.2010 was valid upto 25.07.2015, a hiatus was created in continuation of the duties when the notification dated 06.08.2015 was issued extending the anti-dumping duty for a period of one year w.e.f 26.07.2015 till 25.07.2016. No anti-dumping duty could, therefore, have been levied between 26.07.2015 and 05.08.2015. In this connection, reliance has been placed on 10 AD/50571/2022 the judgment of the Supreme Court in Union of India vs. Kumho Petrochemicals Company Ltd. 6 and the judgment of the Delhi High Court in Forech India Ltd. vs. Designated Authority 7;

(iv) In any case, the notification dated 06.08.2015 is non-est in law and could not have imposed anti-dumping duty for a period of one year; and

(v) Likewise, the second extension of anti-dumping duty by notification dated 08.08.2016 is bad in law as anti-dumping duty had lapsed on 25.07.2016 since the earlier notification dated 06.08.2015 had extended the anti-dumping duty only upto 25.07.2016.

12. Ms. Reena Khair, learned counsel assisted by Shri Rajesh Sharma, Ms. Shreya Dahiya and Shri Subham Jaiswal, for the respondent domestic industry, made the following submissions:

(i) In view of the provisions of section 9A(5) of the Tariff Act, the Central Government, in a review, can extend the period of imposition of anti-dumping duty after the expiry of five years from the date of initial imposition;

(ii) One year duty under the second proviso to section 9A(5) of the Tariff Act is imposed by the Central Government by issuance of an amending notification extending the validity of the parent notification pending the outcome of review investigation. As against this, five years duty is imposed pursuant to the final findings of the designated authority, recommending imposition of duty for a further period of five years, by way of a fresh duty notification;

6. 2017 (351) E.L.T. 65 (S.C.)

7. 2018 (361) E.L.T. 671 (Del.) 11 AD/50571/2022

(iii) Rule 23 of the Anti-Dumping Rules, 1995 8 read with rule 17 permits completion of a review investigation within a period of twelve months, which can be further extended by six months in appropriate cases. However, the duty can be extended for a maximum period of one year. There could, therefore, be a gap or a vacuum between the expiry of the one year duty and fresh imposition of five years duty on completion of investigations. This gap does not invalidate the levy of fresh duty for a period of five years. In support of this contention reliance has been placed on the decision of the Delhi High Court in Fairdeal Polychem LLP vs. Union of India 9, which judgment relied upon the decision of the Supreme Court in Commissioner of Customs, Bangalore vs. G.M. Exports and Others 10; and

(iv) In any view of the matter, the notification dated 08.08.2016 stood expired on 07.08.2021 and, therefore, the appeal has been rendered infructuous. In support of this contention reliance has been placed on the decision of the Supreme Court in Designated Authority vs. Reliance Industries Ltd. 11

13. Shri Ameet Singh, learned counsel appearing for the designated authority and Shri Nagendra Yadav, learned counsel appearing for the Union of India, adopted the submissions made by Ms. Reena Khair, learned counsel for the respondent domestic industries and also submitted that in view of the provisions of section 9A(5) of the Tariff Act, there is no mandatory requirement

8. the 1995 Rules

9. 2016 (334) E.L.T. 241 (Del.)

10. (2016) 1 Supreme Court Case 91

11. 2004 (163) E.L.T. A113 (S.C.) 12 AD/50571/2022 that a notification for extension of the anti-dumping duty should be issued before the expiry of the period of five years or one year.

14. The submissions advanced by the learned counsel for the appellant and the learned counsel for the domestic industry and the designated authority as also the learned authorized representative of the department have been considered.

15. In order to appreciate the submissions, it would be appropriate to reproduce section 9A(5) of the Tariff Act and it is as follows:

"9A(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."

16. Anti-dumping duty on dumped articles is imposed under section 9A of the Tariff Act and the relevant portion is reproduced below:

"Section 9A. Anti- dumping duty on dumped articles. --

(1) Where any article is exported by an exporter or producer from any country or territory (hereinafter 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."

AD/50571/2022

17. As would be seen from a perusal of section 9A (5) of the Tariff Act, anti-dumping duty imposed under section 9A(1) of the Tariff Act shall, unless revoked earlier, cease to have effect on the expiry of five years from the date of such imposition. However, 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. In a case where a review initiated before the expiry of the period of five years has not concluded before the expiry of five years, 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.

18. The first contention raised by learned counsel for the appellant is that in the absence of any notification issued by the Central Government imposing anti-dumping duty on the basis of the recommendation made by the designated authority in the final findings dated 10.04.2012, anti-dumping duty could not have been levied. In this connection, learned counsel for the appellant pointed out that the Tribunal, while adjudicating the challenge to the final findings dated 17.05.2010 of the designated authority and the notification dated 26.07.2010 issued by the Central Government imposing anti-dumping duty on imports of the subject goods, had in Allied Enterprises remanded the matter to the designated authority for affording a post-decisional hearing and for making such modifications in the final findings as may be considered necessary as a result of such post-decisional hearing. According to the learned counsel for the appellant, it would necessarily follow from the 14 AD/50571/2022 aforesaid directions of the Tribunal that the notification dated 26.07.2010 impliedly stood quashed.

19. It is not possible to accept this contention of learned counsel for the appellant. It is clear from a perusal of the decision of the Tribunal that the reason why the matter had been remanded to the designated authority was that one particular designated authority had conducted public hearing but a successor designated authority had issued the final findings. This was in the teeth of the judgment of the Supreme Court in Automotive Tyre Manufacturers Association. The Tribunal, therefore, proceeded to examine whether it would be appropriate to set aside the final findings and the consequent notification issued by the Central Government since if this was done, anti-dumping duty would stand removed which would cause irreparable injury to the domestic industry. This proposition was not accepted by the Tribunal and it is keeping this in mind that the Tribunal remanded the matter to the designated authority only for the purpose of affording a post-decisional hearing. It was also left open to the designated authority to make such modifications in the final findings as may be considered necessary as a result of such post-decisional hearing. The Tribunal also observed that any modification made in the final findings by the designated authority would be given effect to by the Central Government by carrying out the necessary amendments in the earlier notification dated 26.07.2010 imposing anti-dumping duty. It is, therefore, clear that only if any modification was made in the final findings that the same was required to be given effect to by the Central Government by carrying out necessary amendments in the earlier notification dated 26.07.2010 that had been issued imposing anti-dumping duty. 15

AD/50571/2022

20. As noticed above, the designated authority had on remand, confirmed the conclusions arrived at in the earlier final findings dated 17.05.2010 and also observed that in such circumstances it was not necessary to make any changes in the notification earlier issued. Thus, as even after affording post-decisional hearing to the parties, the designated authority confirmed the earlier findings, there was no necessity for the Central Government to issue a fresh notification imposing anti-dumping duty as the earlier notification dated 26.07.2010 issued by the Central Government imposing anti- dumping duty warranted no change. The said notification dated 26.07.2010 continued to operate as a result of which anti-dumping duty was leviable upto 25.07.2015.

21. Learned counsel for the appellant, in the alternative, urged that even if the notification dated 26.07.2010 was operative then too it came to an end on 25.07.2015. In this connection, learned counsel pointed out that though the sunset review investigation was initiated on 22.07.2015 before the expiry of aforesaid period of five years, but a notification in terms of the second proviso to section 9A(5) of the Tariff Act was issued only on 06.08.2015 by which the notification dated 26.07.2010 was amended by adding paragraph 3 to the effect that notwithstanding anything contained in paragraph 2, the notification shall continue to remain in force upto and inclusive of the 25th day of July 2016, unless revoked earlier. Learned counsel submitted that in view of the judgments of the Delhi High Court in Forech India and Kumho Petrochemicals Co. Ltd. vs. Union of India 12 , a notification in terms of the second proviso to section 9A(5) of the Tariff Act could have been issued

12. 2014 (306) E.L.T. 3 (Del.) 16 AD/50571/2022 only during the lifetime of the notification dated 26.07.2010. In other words, the contention advanced is that a notification in terms of the second proviso to section 9A(5) of the Tariff Act could have issued only on or before 25.07.2015.

22. This issue was examined by the Delhi High Court in Kumho Petrochemicals. The final findings dated 17.07.1997 of the designated authority were accepted by the Central Government and a notification 30.07.1997 was issued by the Central Government imposing anti-dumping duty for a period of five years, but before the expiry of the said period of five years a sunset review investigation was initiated. On the basis of this investigation, a notification dated October 10, 2002 was issued by the Central Government imposing anti-dumping duty till 10.12.2007. On 08.10.2007, a second sunset review investigation was initiated and this resulted in issuance of a notification 02.01.2009 by the Central Government notifying that the anti-dumping duty shall remain in force till 01.01.2014. On 31.12.2013 a third sunset review investigation was initiated. Thereafter, a notification dated 23.01.2014 was issued by the Central Government extending the validity of the earlier notification by one year up to 01.01.2015 pending the investigation, in exercise of the powers conferred under the second proviso to sub-section (5) of section 9A of the Tariff Act. It is this notification dated 23.01.2014 that was challenged by Kumho Petrochemicals by filing writ a petition. The Delhi High Court accepted the contention that a notification under the second proviso to section 9A(5) of the Tariff Act can be issued only during the lifetime of the principal notification and the relevant portions of the judgment are reproduced below: 17

AD/50571/2022 "25. In the light of the above position, this Court holds that what follows is that the levy of anti-dumping duty ended on 1-1-2014, with the lapse of the original notification. The second proviso to Section 9A(5) precluded the Central Government from continuing the levy beyond that period or date, except to the extent its conditions were fulfilled, i.e. if the levy of the duty were to have been notified before such date. In such cases, the power under the second proviso to Section 9A(5), after expiry of the date of the original notification, is unavailable. The notification in the present case states that :

"3. Notwithstanding anything contained in paragraph 2, this notification shall remain in force upto and inclusive of the 1st day of January, 2015, with respect to anti- dumping duty on Acrylonitrile Butadiene Rubber originating in, or exported from Korea RP, unless revoked earlier".

Neither does Section 9A(1) nor Section 9A(5) permit the extension of anti-dumping duty once the main period of five years lapses, as held earlier. The Central Government is not arguing that it had the benefit of Section 21 of the General Clauses Act - for the simple reason that extension or amendment of an earlier notification can be only after following the procedure adopted while issuing the main notification. In the present case, the amendment is retrospective, as it were, and made effective from 2009. It was in fact made after the lapse of the first period."

(emphasis supplied)

23. The aforesaid judgment of the Delhi High Court in Kumho Petrochemicals was assailed by the Union of India before the Supreme Court. The Supreme Court, in the judgment dated 09.06.2017, did not find any infirmity in the approach of the High Court in interpreting the second proviso to sub-section (5) of section 9A of the Tariff Act and the relevant observations of the Supreme Court are as follows:

"31) After giving due consideration to the arguments advanced by the learned counsel for the parties, we are inclined to agree with the High Court that proviso to sub-section (5) of Section 9A of the Act is an enabling provision. That is very clear from 18 AD/50571/2022 the language of the said provision itself. Sub-section (5) of Section 9A gives maximum life of five years to the imposition of anti-dumping duty by issuing a particular notification. Of course, this can be extended by issuing fresh notification. However, the words 'unless revoked earlier' in sub-

section (5) clearly indicate that the period of five years can be curtailed by revoking the imposition of anti-dumping duty earlier. Of course, provision for review is there, as mentioned above, and the Central Government may extend the period if after undertaking the review it forms an opinion that continuation of such an anti-dumping duty is necessary in public interest. When such a notification is issued after review, period of imposition gets extended by another five years. That is the effect of first proviso to sub-section (5) of Section 9A. However, what we intend to emphasise here is that even as per sub-section (5) it is not necessary that in all cases anti-dumping duty shall be imposed for a full period of five years as it can be revoked earlier.

Likewise, when a review is initiated but final conclusion is not arrived at and the period of five years stipulated in the original notification expires in the meantime, as per second proviso 'the anti-dumping duty may continue to remain in force'. However, it cannot be said that the duty would automatically get continued after the expiry of five years simply because review exercise is initiated before the expiry of the aforesaid period. It cannot be denied, which was not even disputed before us, that issuance of a notification is necessary for extending the period of anti-dumping duty. Reason is simple. There no duty or tax can be imposed without the authority of 'law'. Here, such a law has to be in the form of an appropriate notification and in the absence thereof the duty, which is in the form of a tax, cannot be extracted as, otherwise, it would violate the provisions of Article 265 of the Constitution of India. As a fortiorari, it becomes apparent that the Government is to exercise its power to issue a requisite notification. In this hue, the expression 'may' in the second proviso to sub-section (5) has to be read as enabling power which gives discretion to the Central Government to determine as to whether to exercise such a power or not. It, thus, becomes an enabling provision.

xxxxxxxxxxxx 19 AD/50571/2022

33) The anti-dumping duty may continue, pending the outcome of the review, for a further period not exceeding one year. Thus, maximum period of one year is prescribed for this purpose which implies that the period can be lesser as well. The Government is, thus, to necessarily form an opinion as to for how much period it wants to continue the anti- dumping duty pending outcome of such a review. Moreover, since the maximum period is one year, if the review exercise is not completed within one year, the effect of that would be that after the lapse of one year there would not be any anti-dumping duty even if the review is pending. In that eventuality, it is only after the review exercise is complete and the Central Government forms the opinion that the cessation of such a duty is likely to lead to continuation or recurrence of dumping and injury, it would issue a notification extending the period of imposition of duty. Therefore, there may be a situation where even when the power is exercised under second proviso and duty period extended by full one year, the review exercise could not be completed within that period. In that situation, vacuum shall still be created in the interregnum beyond the period of one year and till the review exercise is complete and fresh notification is issued.

This situation belies the argument that extension under second proviso is to be treated as automatic to avoid the hiatus or vacuum in between.

xxxxxxxxx

35) With this, we advert to the second facet of the argument, namely whether it was permissible for the Central Government to issue Notification dated January 23, 2014 thereby extending the validity of duty by one year, i.e. after the period of earlier Notification came to an end on January 01, 2014? If so, whether this Notification would take effect from January 01, 2014 or January 23, 2014?

36) As noticed above, the High Court has held that once the earlier Notification by which anti-dumping duty was extended by five years, i.e. up to January 01, 2014, expired, the Central Government was not empowered to issue any Notification after the said date, namely, on January 23, 2014, inasmuch as there was no Notification 20 AD/50571/2022 in existence the period whereof could be extended. The High Court, in the process, has also held that the Notification extending anti-dumping duty by five years, i.e. up to January 01, 2014 was in the nature of temporary legislation and validity thereof could be extended, in exercise of powers contained in second proviso to sub-section (5) of Section 9A of the Act only before January 01, 2014.

37) We do not find any infirmity in the aforesaid approach of the High Court in interpreting the second proviso to Section 9A(5) of the Act. The High Court has rightly interpreted the aforesaid provision in the light of Article 11.1 , 11.2 and 11.3 of the Agreement for Implementation and Article VI of the GATT, commonly known as 'Implementation Agreement'. xxxxxxxxxxx."

24. Subsequently, in Forech India, the same principle was reiterated by the Delhi High Court. In this case, anti-dumping duty had been imposed for a period of five years which was to expire on 04.05.2013. On 30.04.2013, sunset review proceedings had been initiated but it is only after 60 days of the expiry of anti-dumping duty that a notification was issued extending the anti-dumping duty for a period of one year from 05.05.2013 to 04.05.2014. The Delhi High Court, after considering the judgment of Supreme Court in Kumho Petrochemicals, held that levy imposed by the notification issued 60 days after the expiry of anti-dumping duty was without authority of law and the observations are:

"20. Applying the said principle to the facts of the present case, it is seen that the Notification No. 17/2013 issued 60 days after the expiry of the levy of Anti- dumping duty under the first five year period, would be non est because it sought to extend a levy which had lapsed on 4-5-2013. The second proviso to Section 9A(5) of the Act is an enabling provision granting the Central Government the authority to continue Anti-dumping duty pending the outcome of the Sunset Review for a further period not exceeding one year. The essential requirements for such continuation are : (i) the Sunset Review ought to have been 21 AD/50571/2022 initiated before the expiry of the five year period of levy of Anti- dumping duty; (ii) the inquiry has not concluded within the said period; (iii) a prima facie view is formed by the Government that continuance of the Anti-dumping duty would be necessary, and (iv) such extended period would not exceed one year from the date on which the first five years expires. The phrase "may continue to remain in force", assumes that there is a levy which exists and its continuance i.e. its carrying forward - without a break in its existence, is necessary. The moment the levy comes to an end or there is a break in its continuance, it cannot be revived in the Sunset Review exercise. Extending the levy is like stretching the fabric of the levy to cover the extended period for another year. In the present case, the original levy came to an end on 4-5-2013. The levy had a limited life and unless fresh life was infused in it before its predetermined expiry date, it could not be deemed to have been extended. Infusion of fresh life into the levy for a period of one year requires a fresh notification, in addition to the notification for initiation of the Sunset Review. That not being so, in the present case the levy under impugned Notification is without authority, hence it has to be and is set aside."

(emphasis supplied)

25. In view of the aforesaid decisions it has to be held that the notification dated 06.08.2015 is non-est in law as a result of which the anti-dumping duty initially imposed by notification dated 26.07.2010 could not have been continued after 25.07.2015 for a period of one year.

26. However, as noticed above, on the basis of a sunset review, the Central Government issued a notification dated 08.08.2016, imposing anti-dumping duty for a period of five years.

27. The second contention of the learned counsel for the appellant, which is in the alternative, is that even if the anti- dumping duty imposed by the notification dated 06.08.2015 had continued to operate till 25.07.2016, then too there was a gap of thirteen days before the issuance of the notification dated 22 AD/50571/2022 08.08.2016 imposing any anti-dumping duty for a period of five years.

28. In view of the aforesaid finding that the notification dated 06.08.2015 is non-est in law, it would not be necessary to examine this issue, but in any view of the matter even if anti-dumping duty were to continue upto 25.07.2016, then too, anti-dumping duty could not have been imposed between 26.07.2016 and 07.08.2016.

29. The third and the main contention advanced by the learned counsel for the appellant to assail the final findings dated 08.07.2016 of the designated authority and the consequential notification dated 08.08.2016 issued by the Central Government is that since there was a gap before the imposition of anti-dumping duty by notification dated 08.08.2016, anti-dumping duty could not have been imposed, in view of the judgment of the Supreme Court in Kumho Petrochemicals.

30. It is not possible to accept this contention of the learned counsel for the appellant.

31. In a sunset review, a notification is issued by the Central Government exercising powers under the first proviso to section 9A(5) of the Tariff Act, unlike the powers that are exercised by the Central Government under the second proviso to section 9A(5) of the Tariff Act for continuing the anti-dumping duty during the pendency of a sunset review for a maximum period one year. There is no requirement under the first proviso to section 9A(5) of the Tariff Act that the Central Government should issue the notification only during the lifetime of the earlier notification imposing anti- dumping duty. This aspect was considered by the Supreme Court in paragraph 33 of the judgment rendered in Kumho 23 AD/50571/2022 Petrochemicals. The Supreme Court observed that even if the review exercise is not completed within the extended period of one year under the second proviso, the effect would be that after lapse of one year there would not be any anti-dumping duty even if the review is pending. In such a situation it is only after the review exercise is completed and the Central Government forms an opinion that cessation of such duty is likely to lead to continuation or recurrence of dumping an injury, it can issue a notification for imposition of duty. The Supreme Court emphasized that the vacuum would be only during the interregnum beyond the period of one year and till the issuance of fresh notification by the Central Government. It, therefore, follows that there is no requirement that a notification has to be issued by the Central Government under the first proviso to section 9A(5) of the Tariff Act only during the lifetime of the earlier notification imposing anti-dumping duty for a period of five years.

32. It also needs to be noted that the final findings dated 08.07.2016 of the designated authority and the consequential notification dated 08.08.2016 issued by the Central Government continuing the anti-dumping duty for a period of 5 years was assailed in an Anti-Dumping Appeal filed by Tangshan Sanyou Group Hong Kong International Trade Co. Ltd. The exporters from Indonesia were also impleaded as respondents. This appeal was dismissed by the Tribunal by a detailed order dated 24.01.2017 and the notification dated 08.08.2016 issued by Central Government was upheld. This decision is reported in 2017 (349) E.L.T. 667 (Tri. - 24

AD/50571/2022 Del.) 13 . The relevant paragraphs 1 and 12 of the decision are reproduced below:

"The appellant is an exporter of Viscose Staple Fibre excluding bamboo fibre (subject goods) and is located in Hong Kong. They participated in the Sunset review investigation of the anti- dumping duty imposed on subject goods when imported from China PR and Indonesia. The present appeal is against final finding dated 8-7-2016 of the Designated Authority (DA), Directorate General of Anti-Dumping and Allied Duties, Ministry of Commerce and Industry and Customs Notification No. 43/2016-CUS (ADD), dated 8-8-2016 which was issued based on the said final finding of the DA. The final finding now impugned is on conclusion of Sunset review of anti- dumping duty imposed on the subject goods. The Sunset review was done on a petition filed by Association of Man-made Fibre Industry of India on behalf of Domestic Industry (DI). M/s. Grasim Industries Ltd. is the sole producer who furnished all information for the review. The DA concluded that the subject goods continue to enter into the market with dumped prices. Dumping margin and injury margin are positive and significant. Performance of the Domestic Industry has worsened in terms of various economic parameters. There is likelihood of price under cutting in case of cessation of anti-dumping duty. Based on such finding he recommended continuation of definitive anti-dumping duty on all imports of subject goods. Accordingly, the Customs Notification dated 8-8-2016 was issued by the Ministry of Finance to give effect to the recommendations.

12. After having carefully considered the rival submissions we note that anti-dumping duty is a trade remedy measure to counter dumping. Imposition of anti-dumping duty is authorized in terms of an international agreement under WTO. Protection of domestic industry of the Member country against unfair trade practices is the rationale in imposing such duty. Section 9A(5) of the Customs Tariff Act, 1975 provides for review of the anti- dumping duty imposed. If upon review, if the Government is of the opinion that the cessation of such duty is likely to lead to continuation or recurrence of dumping and injury, it may, extend the period of such imposition for a further period of 5 years. In the facts of the present case, we find the appellant

13. Tangshan Sanyou Group Hong Kong International Trade Co. Ltd. vs. Union of India 25 AD/50571/2022 could not place before us any empherical evidence to counter the final findings on Sunset review by the DA. It has been clearly recorded that cessation of existing anti-dumping duty on the subject goods is likely to result in recurrence of dumping and injury to the DI. Basically, we note that the present impugned findings are in continuation of the earlier findings as it has been recorded that there is a need to continue the imposition of anti-dumping duty in terms of applicable legal provisions after due consideration of the economic parameters. We find no merit in the present appeal to persuade us to interfere with the impugned final findings or the customs notification issued based thereon. Accordingly, we dismiss the appeal. The stay application linked to the appeal is also disposed of."

(emphasis supplied)

33. It is also important to note that before the expiry of the period of five years from the issuance of the notification dated 08.08.2016 imposing anti-dumping duty for a period of five years, a second sunset review investigation was initiated by a notification dated 22.02.2021 to review the need for continued imposition of the duties in force in respect of the subject goods originating in or exported from the subject countries and to examine whether the expiry of such duty was likely to lead to continuation or recurrence of dumping and injury to the domestic industry. The existing duties on the subject goods imposed by notification dated 08.08.2016 were to expire on 07.08.2021, and so the Central Government, by a notification dated 30.06.2021, extended anti-dumping duties upto 31.10.2021. In regard to the second sunset review initiated on 22.02.2021, the designated authority, in its final findings notified on 31.07.2021, concluded that there was no justification for recommending continuation of anti-dumping duty and accordingly recommended for withdrawal of anti-dumping duty on import of subject goods from the subject countries imposed by notification 26 AD/50571/2022 dated 08.08.2016, which period was subsequently extended upto 31.10.2021 by the notification dated 30.06.2021. Consequently, the Central Government, by a notification dated 12.08.2021, rescinded the notification dated 08.08.2016, as amended by notification dated 30.06.2021, except as respects things done or omitted to be done before such rescission.

34. It is for this reason that learned counsel for the respondent submitted that as the imposition of anti-dumping duty imposed by notification dated 08.08.2016 stood expired on 07.08.2021, this appeal has been rendered infructuous and in support of this contention reliance has been placed on the judgment of the Supreme Court in Reliance Industries.

35. Once it has been held that anti-dumping duty was validly imposed by notification dated 08.08.2016 for a period five years upto 07.08.2021, it would not be necessary to examine this issue.

36. It, however, needs to be noted that the Supreme Court in Reliance Industries had examined a situation where the period stipulated for imposition of anti-dumping duty had lapsed and in view of the statement made by the learned Assistant Solicitor General of India, dismissed the Special Leave Petition. The observations are as follows:

"Mr. R.N. Trivedi, learned ASG fairly admits that the five years period is already over. He states that this Special Leave Petition has become infructuous. The Special Leave Petition is dismissed as such. Question of law is left open."

37. Learned counsel for the appellant also submitted that the designated authority committed an error in recommending duties which were higher than the dumping margin determined for the foreign exporter as this would be contrary to the provisions of 27 AD/50571/2022 section 9A(1) of the Tariff Act read with rule 4 of the Anti-Dumping Rules.

38. This submission cannot be accepted. In a case where there is an affirmative order for extension of anti-dumping duty on the basis that there is a likelihood of recurrence of dumping and injury, the rigours of section 9A(1) of the Tariff Act would not be attracted. It would be competent for the designated authority to extend the period of imposition without modification of the rate of duty. This is what was observed by the Tribunal in Thai Acrylic Fibre Co. Ltd. 14 vs. Designated Authority and the relevant portion of the decision is reproduced below:

"14. Sunset review entails a likelihood determination in which present levels of dumping is obviously not so relevant as is the likelihood of continuance or recurrence of dumping. Moreover, during the investigation period, the anti-dumping duty would be in force and hence, the current level of dumping may be non- existent or minimal. The exporters under investigation may also sell at a non-dumped price during this period knowing fully well that a sunset review would be in progress. Hence, the criteria under Section 9A(1) that the anti-dumping duty should not exceed the dumping margin would have no practical application for continuance of the duty under Section 9A(5). There is also no such warrant in law under the said Section 9A(5) to do so."

39. Earlier, in Borax Morarji Limited vs. Designated Authority15, a similar view was expressed by the Tribunal and the relevant portion of the decision is reproduced below:

"Proviso to Section 9A(5) of Customs Tariff Act, 1975 primarily intends to undertake review to examine whether cessation of duty on the expiry of five years is likely to lead to continuance/recurrence of dumping and injury - Expression "likely to lead to recurrence" would cover situation where dumping and injury may not exist at time of review due to continuance of anti-dumping duty.

14. 2010 (253) ELT 564 (T)

15. 2007 (215) ELT 33 (T-Del.) 28 AD/50571/2022 During the period of investigation, the anti-dumping duty would be in force and hence, the "current" level of dumping may be nonexistent or minimal. The exporters under investigation may also sell at a non-dumped price during this period knowing fully well that a sunset review would be in progress. Hence, the criteria under Section 9A(1) that the anti-dumping duty should not exceed the dumping margin would have no practical application for continuance of the duty under Section 9A(5). There is also no such warrant in law under the said Section 9A(5) to do so."

40. The challenge to the final findings dated 08.07.2016 of the designated authority and the consequential notification dated 08.08.2016 issued by the Central Government imposing anti- dumping duty, therefore, for all the reasons stated above, fails.

41. This anti-dumping appeal is, accordingly, dismissed.

(Order pronounced on 19.05.2022) (JUSTICE DILIP GUPTA) PRESIDENT (SULEKHA BEEVI C.S.) MEMBER (JUDICIAL) (P. V. SUBBA RAO) MEMBER (TECHNICAL) Shreya

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