Resurrected Anti Dumping - Board Clarifies its own Confusion - Contempt of Court?
IN Circular No. 28/2011 -Customs, dated 8th July 2011, signed by none other than the Joint secretary, TRU, the Board clarified;
Definitive/final anti-dumping duty can be collected only for a period of five years from the date of its imposition. Generally by virtue of Sub-section (2) of Section 9A of the Customs tariff Act, 1975, the anti dumping levy notified in pursuance of final findings of the Director General (AD) is effective from the date of imposition of provisional duty and therefore the period of five years is to be computed from such date. Collection beyond that period is permissible only when the said levy is extended by a notification either for further period of five years (in pursuance of the final findings of the Designated Authority in a Sun Set Review) or for one year (during the pendency of Sun Set Review). Thus, a definitive/final anti-dumping duty can be collected beyond the stipulated period only when a notification extending the levy has been issued, before the expiry of the parent notification. Unless such revalidation or extension is carried out by a fresh notification, the collection of final anti-dumping duty should cease on the completion of five years as mentioned above. Where the findings in a review are notified after the lapse of the parent notification, the notification in such cases would be effective prospectively from the date of issue of such notification .
Now, Board has a rethinking. In its latest Circular, Board says that the Circular was issued in a different context and so Board has substituted the above para with this:
Definitive/final anti-dumping duty can be collected only for a period of five years from the date of its imposition. Generally by virtue of sub-section (2) of section 9A of the Customs tariff Act, 1975, the anti-dumping duty levied in pursuance of final findings of the Directorate General of Anti-Dumping and Allied Duties (DGAD) is effective for a period of five years from the date of imposition of provisional duty except in cases where the DGAD initiates a review before expiry of such five year period . In cases where the DGAD has not initiated any sunset review before the expiry of aforesaid five years, no anti-dumping duty can be collected beyond the period of five years from the date of its imposition.".
The highlighted portion is replaced with the above portion marked in red.
Board seeks to derive its strength from the second proviso to Section 9A (5) of the Customs Tariff Act, which reads as under:
Provided further that where a review initiated before the expiry of the aforesaid period of five years has not come to 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 .
Sir, 'may' does not mean 'will'. In fact this very question has been clearly explained by the Delhi High Court in the Kumho Petrochemicals case (). The High Court in simple terms elucidated:
1. The next issue is the legality of the levy pending sunset review.
2. The original levy has a life of only five years. Thus, the legality of such levy is supported - by virtue of Section 9A (5) only for that duration. If the respondents (Government) wish to continue the levy for a period beyond that, during pendency of sunset review (which might not be concluded by the time the first period expires) they have to issue a notification , before the expiry of that period.
3. It needs to be underlined here that but for the second proviso, there can be no legal extraction, during the sunset review, if the proceeding extends beyond the first five year period. In other words, the second proviso truly carves out an exception and makes the levy which otherwise would be invalid, on account of the operation of the main part, i.e. Section 9A (5), valid if its conditions are fulfilled.
4. 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.
5. Neither does Section 9A (1) nor Section9A (5) permit the extension of anti-dumping duty once the main period of five years lapses, as held earlier.
6. The imperative nature of second proviso to Section 9A (5) leaves no room for doubt that in case the Central Government wishes to extend the levy during the sunset review period, it has to comply with the terms of that provision and do so, before expiration of the original period
Was there any doubt in the High Court verdict, dear Board? The Law allows you to extend the Anti Dumping duty beyond five years, if the review is not completed, but even the Board will know that you have to extend it by a notification before the expiry of five years, not after.
Board has been consistently forgetting to extend the notifications before their expiry and they always arrogantly assumed the power to resurrect dead notifications. Finally some good sense dawned and they issued the Circular No. 28/2011 clarifying that they have to extend the notifications before expiry. But binding itself with such responsibility was always inconvenient - in any case they never followed their own circular.
It is understandable that Board has no respect for its own circulars, because usually the current officers only have contempt for their illustrious predecessors.
But it is sad that Board has no respect for the High Court. Isn't it audacious and contemptuous for the Board to issue a Circular nullifying the High Court's judgement?
Board has gone in appeal to the Supreme Court against the order of the High Court and it is unbecoming of a Government wing to clarify the law against the view of the High Court, when the same issue is pending in the Apex Court. This is a tragedy, especially when you have a Prime Minister who talks about less Government and ease of doing business. Our Babus are capable of frustrating any policy of the Government.
Why can't the Board realize that it is not above law and when you are required to issue a notification before a certain period, you have no option, but to issue that notification well in time? The failure of the babu to wake up in time should not be taken advantage of, in illegal interpretations, with scant respect to the Law as laid down by the High Court.
In fact in the decision referred, the High Court had quoted the Privy Council in a 1936 judgement:
"Where a power is given to do a certain thing in a certain way, the thing must be done in that way or not at all."
CBEC Circular No. 05/2015-Customs., Dated: January 28, 2015