Time limit for issuance of notification imposing anti-dumping duty extended by section 6 of the 2020 Act

Convestro (Hong Kong) Limited Vs Designated Authority (CESTAT Delhi)

CESTAT Delhi held that provisions of section 6 of the Taxation and other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020 (the 2020 Act) extends the time limit specified in the Tariff Act for issuance of the notification imposing anti-dumping duty.

Facts- M/s Convestro (Hong Kong) Limited, an exporter of ‘Flexible Slabstock Polyol’ produced in Singapore, has filed this appeal to assail the customs notification dated 09.06.2020 issued by the Central Government for imposition of anti-dumping duty on the subject goods for a period of five years from the date of publication of the notification on the basis of the sunset review final findings dated 17.03.2020 of the designated authority recommending continuation of definitive anti-dumping duty.

Two issues arise for consideration in this appeal. The first is whether the Central Government could have issued the customs notification on 09.06.2020, as the period for which the existing anti­dumping duty had earlier been imposed by notification dated 07.04.2015 expired on 06.04.2020. The second is whether because of the provisions of section 6 of the Taxation and other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020 relating to “Relaxation of the Time Limit under certain Indirect Tax Laws‟, the period for issue of the notification by the Central Government under the first proviso to section 9A of the Customs Tariff Act, 1975, stood extended upto 31.12.2020.

Conclusion- Under section 6 of the 2020 Act, the time limit specified under the Tariff Act for issuance of a notification falling during the period from 20.03.2020 to 29.09.2020 shall stand extended to 30.09.2020. It is the contention of the appellant that under the first proviso to section 9A(5) of the Tariff Act, the notification for imposition of anti-dumping duty, in a review, has to be issued before the date on which the anti-dumping duty earlier imposed by a notification comes to an end. In other words, according to the appellant, there is time limit within which the notification has to be issued. Thus, section 6 of the 2020 Act would extend the time limit to 30.09.2020 since in the present case, the imposition of the anti-dumping duty by an earlier notification came to an end on 06.04.2020 and this date is between the two dates, namely 20.03.2020 and 29.09.2020. The appellant cannot be permitted to contend that in the context of the first proviso to section 9A(5) of the Tariff Act, the time limit for issuing the notification for imposition of anti-dumping duty is before the last date on which the existing anti­dumping duty comes to an end and also contend, when it comes to the provisions of section 6 of the 2020 Act, that there is no such time limit which can be extended in terms of section 6 of the 2020 Act. If the contention of the appellant that the notification has to be issued during the life time of the existing anti-dumping duty under the first proviso to section 9A(5) is not accepted, then the notification dated 09.06.2020 would be a valid notification. If the contention of the appellant is not accepted, the notification dated 09.06.2020 would still be a valid notification because the time limit gets extended in view of the provisions of section 6 of the 2020 Act. Learned counsel for the appellant is not justified in contending that the notification has to be issued during the life time of the existing duty because of a pre­condition and not because of time limit.

FULL TEXT OF THE CESTAT DELHI ORDER

M/s Convestro (Hong Kong) Limited¹, an exporter of ^„Flexible Slabstock Polyol’² produced in Singapore, has filed this appeal to assail the customs notification dated 09.06.2020 issued by the Central Government for imposition of anti-dumping duty on the subject goods for a period of five years from the date of publication of the notification on the basis of the sunset review final findings dated 17.03.2020 of the designated authority recommending continuation of definitive anti-dumping duty.

2. Two issues arise for consideration in this appeal. The first is whether the Central Government could have issued the customs notification on 09.06.2020, as the period for which the existing anti­dumping duty had earlier been imposed by notification dated 07.04.2015 expired on 06.04.2020. The second is whether because of the provisions of section 6 of the Taxation and other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020 ³ relating to ^„Relaxation of the Time Limit under certain Indirect Tax Laws‟, the period for issue of the notification by the Central Government under the first proviso to section 9A of the Customs Tariff Act, 1975⁴, stood extended upto 31.12.2020.

3. The facts giving rise to the aforesaid issues can be summarized as follows:

 4. Shri V. Lakshmikumaran, learned counsel for the appellant assisted by Shri Anukur Sharma made the following submissions:

(i) The first proviso to section 9A(5) authorizes the Central Government to extend the duty for a further period of five years pursuant to final findings in a sunset review. It preconditions existence of anti-dumping duty for the same to be extended for a further period of five years. If such duty is allowed to expire, the first proviso does not aid the Central Government to revive or bring to life the expired duty after the original levy expires or lapses. In this connection reliance has been placed on the judgment of the Supreme Court in Union of India Kumho Petrochemicals Company Limited⁵ and the judgment of the Delhi High Court in Forech India Ltd. vs. The Designated Authority & Ors.⁶;

(ii) Rule 23(3) of the 1995 Anti-Dumping Rules borrows rule 18 for the purpose of the sunset review mutatis mutandis i.e. with necessary modifications. Rule 18(1) allows the Central Government a period of three months to form its opinion to continue the duty. Here, the time-limit available to the Central Government to form its opinion to extend the duty has to be read in harmony with the provisos to section 9A(5). The extension of duty for further five years would be valid as long as such extension happens before the cessation of existing duty. The language of section 9A(5) read with its provisos and rule 18(1) have to be harmoniously interpreted so as to give effect to the legislative intention under the statute. In the event of a conflict, the obligations in the Tariff Act shall override that under the 1995 Anti-Dumping Rules. Hence, rule 18 cannot enlarge the maximum permissible time allowed under section 9A(5);

(iii) Anti-dumping levy is a temporary legislation. Section 9A(5) expressly states that anti-dumping duty shall cease to have effect on the expiry of five years from the date of imposition. Section 9A(5) also acts as an enabling provision as the first proviso therein authorizes that an anti-dumping levy may be extended for a further period of five years subject to the conditions of the first proviso being fulfilled. In a situation where the review is not completed before expiry of the initial levy, the second proviso aids the Central Government to continue the initial levy up to one more year by issuing another customs notification to that effect. The Tariff Act and the 1995 Anti-Dumping Rules do not contemplate any gaps in continued protection to the domestic industry. As soon as there is a gap in the levy, the duty lapses or ceases to have effect in terms of section 9A(5). When this happens, section 9A(5) of the Tariff Act read the 1995 Anti-Dumping Rules with the provisos do not allow the Central Government to revive a lapsed or dead duty;

(iv) As prescribed under the first proviso to section 9A(5), if the Central Government was of the opinion that cessation or expiry of the anti-dumping duty would lead to continuation or recurrence of dumping and injury in the present case, the Central Government should not have allowed the duty to expire. The Central Government was well within its power to extend the duty before its expiry so that the domestic industry was not left unprotected. Continuous and seamless protection of the domestic industry in the face of continued dumping and injury is the main objective of the anti-dumping law. In support of this contention reliance has been placed on the decision of the Privy Council in Nazir Ahmed King Emperor⁷;

(v) The provision of section 6 of the 2020 Relaxation Act does not save the impugned customs notification. Section 6 extends time limit specified in, or prescribed or notified under Central Excise Act, 1944, the Customs Act, 1962, the Customs Tariff Act, 1975 or Chapter V of the Finance Act, 1994 which falls during the period from the 20th day of March, 2020 to the 29^th day of September, 2020. Clause (b) of section 6 is not applicable in the present case. The impugned customs notification does not fall within the ambit of ‘completion of any proceeding’, ‘issuance of any order’, ‘notice’, ‘intimation’, ‘sanction’, or approval’ in clause (a). The only relevant term in clause (a) is “notification” where the impugned customs notification may fall. Section 9A(5) read with the provisos does not prescribe anytime limit for issuance of a customs notification for imposition of anti-dumping duty. When there is no prescription of time limit in section 9A(5) itself, section 6 will not apply. It cannot be said that section 6 extends the time limit in the present case under rule 18(1), because rules 18(1) is not even applicable in the case of a sunset review, which is the present case; and

(vi) Even if for the sake of argument, it is assumed that section 6 applies in a sunset review and extends the procedural time-limit to issue customs notification, section 6 does not state anywhere that it extends any pre-conditions also. The pre-condition in a sunset review is that anti-dumping duty must be already in existence for it to be extended for another five years. Section 6 does not extend this substantive precondition to cover the gap in time. Thus, the original levy which already lapsed on 06.04.2020, is not automatically extended by virtue of section 6 of the 2020 Relaxation Act.

5. Shri Jitendra Singh, learned counsel for the domestic industry assisted by Shri Akshay Soni, however, refuted the contention of the appellant that the notification issued by the Central Government for imposition of anti-dumping duty pursuant to the recommendation made by the designated authority in the sunset review could not have been issued after 06.04.2020 and in this connection reliance has been placed upon the judgment of the Supreme Court in Kumho Petrochemicals and the decision of the Tribunal in PT South Pacific Viscose vs. Union of India ⁸ . Learned counsel also contended that in any case, the time limit for issuing the notification stands relaxed under section 6 of the 2020 Relaxation Act and to support this contention reliance has been placed on the decision of the Tribunal in Sadara Chemical Company vs. Union of India⁹.

6. Shri S. Seetharaman, learned counsel assisted by Shri Darpan Bhuyan made submissions on behalf of respondent no’s. 4, 5, 6 and 7, who are the producers/exporters from the subject country. Learned counsel supported the stand of the appellant.

7. Shri Jayant Raghu Ram has appeared for the respondent no. 9, who is an importer of the subject goods. Learned counsel also supported the stand of the appellant.

8. Shri Ameet Singh, learned counsel for the designated authority and Shri V. Saharan, learned authorized representative appearing for the Central Government, however, submitted that the notification issued by the Central Government for imposition of anti-dumping duty deserves to be sustained for the reason that it is not necessary that a notification under the first proviso to section 9A(5) of the Tariff Act should be issued by the Central Government before the period for which the anti-dumping duty earlier imposed expired and in any case the time limit for issuing the notification stands extended under the provisions of the 2020 Relaxation Act.

9. The submissions advanced by the learned counsel for the appellant and the learned counsel/authorized representative appearing for the respondents have been considered.

10. Before analyzing the provisions of section 9A(5) of the Tariff Act, it would be relevant to state the factual position.

11. Pursuant to the original investigation that was initiated to examine the nature and extent of dumping and its effect on the domestic industry in regard to the subject goods originating in or exported from the subject countries, the designated authority in its final findings dated 11.01.2015 recommended imposition of anti­dumping duty and thereafter the customs notification dated 07.04.2015 was issued for imposition of anti-dumping duty for a period five years i.e. upto 06.04.2020. Section 9A(5) of the Tariff Act also provides that the anti-dumping duty imposed under the section shall, unless revoked earlier, cease to have effect on the expiry of five years from the date of such imposition. However, under the first proviso to section 9A(5), the Central Government, in a review, may extend the period of such imposition for a further period of five years if the Central Government is of the opinion that the cessation of such duty is likely to lead to continuation or recurrence of dumping and injury. It also provides that the further period of five years shall commence from the date of order of such extension.

12. The designated authority, on the basis of a duly substantiated application filed by the domestic industry for initiation of sunset review investigation, issued a notification dated 09.08.2019 for initiation of the sunset review investigation to examine whether the expiry of the said duty on the import of the subject goods originating in or exported from Singapore was likely to lead to continuation or recurrence of dumping and injury to the domestic industry. It is, therefore, not in dispute that the sunset review investigation was initiated prior to the expiry of five years i.e. prior to 06.04.2020. The designated authority submitted the final findings to the Central Government on 17.03.2020, which date is also before 06.04.2020. The Central Government, thereafter, in exercise of the powers conferred by sub-sections (1) and (5) of section 9A of the Tariff Act read with rules 18 and 23 of the 1995 Rules issued a notification on 09.06.2020 for imposition of anti-dumping duty for a period of five years from the date of publication of the notification.

13. The issue that arises for consideration in this appeal is whether the Central Government could have issued a notification for imposing anti-dumping duty after 06.04.2020.

14. This submission of the learned counsel for the appellant is based on the provisions of section 9A of the Tariff Act. It would, therefore, be necessary to reproduce the relevant portion of section 9A of the Tariff Act and it is as follows:

“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 anti­dumping duty not exceeding the margin of dumping in relation to such article.

(2) xxxxxxxxx

(3) xxxxxxxxx

(4) xxxxxxxxx

(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.”

15. In exercise of the powers conferred by sub-section (6) of section 9A and sub-section (2) of section 9B of the Tariff Act, the Customs Tariff (Identification, Assessment and Collection of Anti-Dumping Duty on Dumped Articles and for Determination of Injury) Rules, 1995¹⁰ have been framed by the Central Government.

16. Rule 4 provides for duties of the of the designated authority to recommend to the Central Government 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, after considering the principles laid down in the Annexure III to the Rules. Rule 17 deals with final findings. It provides that 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 findings. If the final findings are in the affirmative, the designated authority shall recommend the amount of duty which, if levied, would remove the injury to the domestic industry after considering the principles laid down in Annexure III to the Rules. The final findings of the designated authority, in such a situation, shall contain all information on the matter of facts and law and reasons which have led to the conclusion and the designated authority shall also determine an individual margin of dumping for each known exporter or producer concerned of the article under investigation.

17. Annexure-I to the 1995, Anti-Dumping Rules deals with the principles governing the determination of normal value and export price and margin of dumping. It provides that the designated authority while determining the normal value, export price and margin of dumping shall take into account the principles contained in clauses (1) to (8) of the Annexure.

18. Annexure-II to the said Rules deals with the principles for determination of injury. It provides that the designated authority while determining the injury or threat of material injury to domestic industry or material retardation of the establishment of such an industry, and causal link between dumped imports and such injury, shall inter alia, take the principles enumerated from clauses (i) to (vii) of Annexure II under consideration.

19. Annexure-III to the 1995, Anti-Dumping Rules deals with the principles for determination of non-injurious price.

20. Rule 18 deals with levy of duty and sub-rule (1) of rule 18, which is relevant for the purposes of this appeal, is reproduced below:

“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.”

21. Rule 20 provides that the anti-dumping duty shall take effect from the date of its publication in the Official Gazette.

22. Rule 23 deals with review and the relevant portion is reproduced below:

“23. Review:–

(1) xxxxxxxxx

(1A) xxxxxxxxx

(1B) Notwithstanding anything contained in sub-rule(1) or (1A), any definitive antidumping duty levied under the Act, shall be effecting for a period not exceeding five years from the date of its imposition, unless the designated authority comes to a conclusion, on a review initiated before that period on its own initiative or upon a duty substantiated request made by or on behalf of the domestic industry within a reasonable period of time prior to the expiry of that period, that the expiry of the said anti-dumping duty is likely to lead to continuation or recurrence of dumping and injury to the domestic industry.

(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 provision of rules 6, 7, 8, 9, 10, 11, 16, 17, 18, 19, and 20 shall be mutatis mutandis applicable in the case of review.”

23. As noticed above, the Tariff Act and the 1995, Anti-Dumping Rules framed thereunder provide for a detailed exercise to be undertaken before anti-dumping duty can be imposed under section 9A of the Tariff Act. It is for this reason that rule 17 provides for a time period of one year to the designated authority to submit its final findings to the Central Government from the date of initiation of the investigation and thereafter, a period of three months time to the Central Government to take a decision on the recommendation made by the designated authority in the final findings.

24. The contention of the learned counsel for appellant is that since the imposition of anti-dumping duty by customs notification dated 07.04.2015 for a period of five years expired on 06.04.2020, it was not open to the Central Government to issue the notification on 09.06.2020 for imposition of anti-dumping duty under the first proviso to section 9A(5) of the Tariff Act pursuant to the final findings rendered in the sunset review by the designated authority after a gap of 62 days. According to the learned counsel for the appellant, the notification for imposition of anti-dumping duty could only have been issued by the Central Government on or before to 06.04.2020. This issue would require examination of section 9A of the Tariff Act.

25. Section 9A(1) provides that where any article is exported by an exporter or producer from any country 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. 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 is 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.

26. Section 9A has two provisos. The first proviso is with regard to extension of the period of anti-dumping duty for a further period of five years if the Central Government is of the opinion that the cessation of anti-dumping duty is likely to lead to continuation or recurrence of dumping and injury. The second proviso, which deals with a situation where a review initiated before the said period of five years has not come to a conclusion, provides that 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. The courts, have time and again examined the two provisos. The second proviso can be considered first.

SECOND PROVISO

27. The courts have placed emphasis on the use of the expression ^„continue to remain in force‟ and have held that any extension for a further period not exceeding one year should be done before the expiry of the period of five years, for which period the anti-dumping duty had been imposed. This issue as to whether a notification in terms of the second proviso to section 9A(5) of the Tariff Act can be issued only during the lifetime of the notification imposing anti­dumping duty was examined by the Delhi High Court in Kumho Petrochemicals Co. Ltd. Union of India¹¹. 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:

“25. In the light of the above position, this Court holds that what follows is that the levy of anti­dumping 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)

28. 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 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 sub­section (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.

xxxxxxxxx

(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 anti­dumping 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 anti­dumping 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.

*****

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 anti­dumping 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 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.”

(emphasis supplied)

29. 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 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)

FIRST PROVISO

30. The first proviso, however, which deals with a situation where the Central Government in a review is of the opinion that cessation of anti-dumping duty would likely lead to continuation or recurrence of dumping and injury, uses to the expression ^„extend the period of such imposition‟, instead of the expression ^„continue to remain in force‟ used in the second proviso.

31. It has, therefore, to be seen whether the requirement for the second proviso can also be applied to the first proviso to section 9A(5) of the Tariff Act, namely whether the first proviso to section 9A(5) of the Tariff Act requires that the Central Government should issue the notification only during the lifetime of the earlier notification imposing anti-dumping duty. What would, therefore, have to be examined in the present case is whether the notification for imposing anti-dumping duty could have been issued on 09.06.2020, even though the anti-dumping duty earlier imposed by the notification dated 07.04.2015 expired on 06.04.2020.

32. 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.

33. This aspect was considered by the Supreme Court in paragraph 33 of the judgment rendered in Kumho 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 from the decision of the Supreme Court 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 year.

34. It is, in view of the aforesaid decision of the Supreme Court in Kumho Petrochemicals, that the learned counsel appearing for the domestic industry, the learned counsel appearing for the designated authority and the learned authorised representative appearing for the Central Government contended that the Central Government can issue a notification for imposition of anti-dumping duty even after the expiry of the period for which the anti-dumping duty was imposed and it is not necessary that the notification for extension of anti­dumping duty should be issued only during the period the duty is in existence. Learned counsel also submitted that a reading of the first proviso to section 9A(5) of the Tariff Act leaves no manner of doubt that the notification can be issued by the Central Government even after the expiry of the period of five years but in such a situation the duty so imposed would commence from the date of order of such extension and there would be a vacuum during the interregnum period. Learned counsel emphasized that there is marked difference between first and the second proviso to section 9A(5) of the Tariff Act.

35. Learned counsel for the appellant, however, placed reliance upon the judgment of the Delhi High Court in Forech India and contended that even in such a situation there would have to be a duty in existence for it to be extended. The paragraphs, on which reliance has been placed by the learned counsel for the appellant, are:

“21. Likewise the second notification imposing Anti-Dumping Duty for a period of five years too cannot be sustained because it has to be issued within the period of first five years or in the extended one year period of Sunset Review in which the earlier existing duty has been extended. The first proviso of section 9A(5) of the Act stipulates that in a Sunset Review when the Central Government is of the opinion that cessation of such duty is likely to lead to continuation or recurrence of dumping or injury, it may extend the period of levy for a further period of five years. The degree of levy would be to the extent necessary to offset the injury. In other words, there would have to be a duty in existence for it to be extended. In the present case there was cessation of duty on 05.05.2013 and again on 05.05.2014, therefore, there was no duty on two dates which could have been extended.

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23. The respondents argue that there is no delay in the Customs Notification No. 35/2014 dated 24.07.2014 as it was notified within the three months period provided under Rule 18A(1) of the Rules. The Court would note that under Rule 18A(1), the Central Government may within three months from the date of publication of the Final Findings impose Anti- Dumping Duty by Notification in the Official Gazette, however, this three month period is not a stand-alone authorization to the Government. It has to be harmoniously read with the strict timeline fixed in the statute under section 9A(5) of the Act. The Act embodies the commitment of the Government of India under Article 11(4) of the Implementation Agreement. The Rule cannot override the Act. The Act has fixed a period for completion of Sunset Review within one year from the date of expiry of the initial five year levy and it is in this one year period that the Government must form a view that the cessation of duty would lead to continuation or recurrence of dumping and injury. Therefore, it is only within this period that it may extend i.e. without breaking the continuity of the previous duty or its modified version, for a further period of five years. The thread of the existing duty has to continue from the initial five year levy to the one year extended period of Sunset Review to the proposed five year period. There should be no break in between. However, in the present case, there are two breaks. Therefore, Rule 18(1) does not and cannot be read to lend any authority or power to the Central Government to issue Customs Notification No. 35/2014. It is illegal and, accordingly, set aside. The period of three months under Rule 18(1) can be read only in the case of original notification for Anti-Dumping Duty and not for the Sunset Review.”

(emphasis supplied)

36. When confronted with this decision of the Delhi High Court, learned counsel for the domestic industry submitted when the Supreme Court in Kumho Petrochemicals had clarified in paragraph 33 of the judgment that a notification for imposition of anti-dumping duty can be issued by the Central Government even after the expiry of the five years or the extended period of one year but with a rider that during the interregnum period there would be no duty (meaning thereby that there can be no retrospective notification), the contention advanced by learned counsel for the appellant should not be accepted. However, learned counsel for the domestic industry also submitted that even if this submission of the learned counsel for the appellant for the sake of argument is accepted, then too, in such a situation, the time limit prescribed for issuing the notification for imposition of anti-dumping duty would automatically get extended in view of the provisions of section 6 the 2020 Relaxation Act and, therefore, the notification issued by the Central Government would be a valid notification.

37. To appreciate this submission of learned counsel for the domestic industry, it would be appropriate to reproduce the provisions of section 6 of the 2020 Relaxation Act and it is as follows:

“CHAPTER V

RELAXATION OF TIME LIMIT UNDER CERTAIN
INDIRECT TAX LAWS

6. Notwithstanding anything contained in the Central Excise Act, 1944, the Customs Act, 1962 (except sections 30, 30A, 41, 41A, 46 and 47), the Customs Tariff Act, 1975 or Chapter V of the Finance Act, 1994, as it stood prior to its omission vide section 173 of the Central Goods and Services Tax Act, 2017 with effect from the 1st day of July, 2017, the time limit specified in, or prescribed or notified under, the said Acts which falls during the period from the 20th day of March, 2020 to the 29th day of September, 2020 or such other date after the 29th day of September, 2020 as the Central Government may by notification, specify, for the completion or compliance of such action  as-   

(a) completion of any proceeding or issuance of any order, notice, intimation, notification or sanction or approval, by whatever name called, by any authority, commission, tribunal, by whatever name called; or

(b) filing of any appeal, reply or application or furnishing of any report, document, return or statement, by whatever name called,

shall, notwithstanding that completion or compliance of such action has not been made within such time, stand extended to the 30th day of September, 2020 or such other date after 30th day of September, 2020 as the Central Government may, by notification, specify in this behalf:”

(emphasis supplied)

38. Subsequently, by a notification dated 30.09.2020, the time period was extended from 30.09.2020 to 31.12.2020.

39. A perusal of section 6 of the 2020 Act makes it clear that the time limit specified in, or prescribed or notified under the Tariff Act falling between 20.03.2020 to 29.09.2020 for the completion of such action as completion of any proceeding or issuance of any order, notice, notification by any authority shall, nowithstanding that completion of such action has not been made within such time, stand extended upto 30.09.2020.

40. The submission advanced by learned counsel for the domestic industry, the designated authority and the Central Government is that even if the contention of the appellant that the notification for imposition of anti-dumping duty could have been issued only on or before 06.04.2002 is accepted, then too the time limit for issuance of the notification gets extended in view of the provision of section 6 of the 2020 Act. Elaborating this submission, it was pointed out that section 6 of the 2020 Act extends the time limit specified in the Tariff Act for issuance of the notification imposing anti-dumping duty. This submission of the learned counsel for the respondent is based on the submission of learned counsel for the appellant that the notification for extension of the period of duty for a further period of five years has to be issued during life time of the existing duty.

41. Learned counsel for the appellant, however, submitted that section 6 may extend the time limit specified in the Tariff Act, which falls during the period from 20.03.2020 to 29.09.2020 clause (a) of section 6 but this would not help the domestic industry for the reason that section 9A(5) of the Tariff Act read with the provisos does not prescribe any time limit for issuance of a notification for imposition of anti-dumping duty. The contention is that when there is no prescription of time limit in section 9A(5), section 6 will not apply. Learned counsel for the appellant also submitted that even if it is accepted that section 6 applies in a sunset review, section 6 does not state anywhere that it extends any preconditions also. According to the learned counsel it is a precondition imposed in the sunset review because of which anti-dumping duty must be already in existence for it to be extended for another five years and section 6 does not extend this substantive precondition to cover the gap in time. Thus, according to the learned counsel, the original levy which already lapsed on 07.04.2020, is not automatically extended by virtue of section 6.

42. There is merit in the contention advanced by the learned counsel appearing for the domestic industry. Under section 6 of the 2020 Act, the time limit specified under the Tariff Act for issuance of a notification falling during the period from 20.03.2020 to 29.09.2020 shall stand extended to 30.09.2020. It is the contention of the appellant that under the first proviso to section 9A(5) of the Tariff Act, the notification for imposition of anti-dumping duty, in a review, has to be issued before the date on which the anti-dumping duty earlier imposed by a notification comes to an end. In other words, according to the appellant, there is time limit within which the notification has to be issued. Thus, section 6 of the 2020 Act would extend the time limit to 30.09.2020 since in the present case, the imposition of the anti-dumping duty by an earlier notification came to an end on 06.04.2020 and this date is between the two dates, namely 20.03.2020 and 29.09.2020. The appellant cannot be permitted to contend that in the context of the first proviso to section 9A(5) of the Tariff Act, the time limit for issuing the notification for imposition of anti-dumping duty is before the last date on which the existing anti­dumping duty comes to an end and also contend, when it comes to the provisions of section 6 of the 2020 Act, that there is no such time limit which can be extended in terms of section 6 of the 2020 Act. If the contention of the appellant that the notification has to be issued during the life time of the existing anti-dumping duty under the first proviso to section 9A(5) is not accepted, then the notification dated 09.06.2020 would be a valid notification. If the contention of the appellant is not accepted, the notification dated 09.06.2020 would still be a valid notification because the time limit gets extended in view of the provisions of section 6 of the 2020 Act. Learned counsel for the appellant is not justified in contending that the notification has to be issued during the life time of the existing duty because of a pre­condition and not because of time limit.

43. Thus, as the only contention raised by the learned counsel for the appellant for setting aside the notification dated 09.06.2020 has no merit, the appeal deserves to be dismissed and is dismissed.

(Order pronounced on 22.03.2023)

Note:-

1. the appellent

2. the subject goods

3. the 2022 relaxation act

4. the traffic act

5. (2017) 8SCC 307

6. 2018 (361) E.L.T 671(Del.)

7. AIR/50224/2021

8. Anti-Dumping Appeal no 50571of 2022 decided on19.05.2022

9. Anti -dumping Appeal no 50864 of 2021 decided on 01.11.2021

10. the 1995 anti dumping rules

11. 2014 (306) E.L.T. 3(Del.)