IMPORTANT POINT
Designated Authority under Custom Tariff Act discharges quasi-judicial function.

Headnote:(a) Words and Phrases – Administration and Judicial functions – Although both strive to arrive at a just decision, thin distinction exists – Determinative factors stated. (Paras 49 to 51)
        (b) Customs Tariff (Identification, Assessment & Collection of Anti-Dumping Duty on Dumped Articles & for Determination of Injury) Rules, 1995 – Rules 5, 6, 12 and 17 r/w section 9(C), Customs Tariff Act, 1975 – DA exercises quasi-judicial functions and is bound to act judicially. (Paras 52 and 53)
        (c) Words and Phrases – Natural Justice – Not embodied rules nor capable of precise definition – Evolved to check arbitrary exercise of power by the State or its functionaries – Unless a statutory provision, either specifically or by necessary implication excludes the application of principles of natural justice, requirement of giving reasonable opportunity of being heard, is generally read into the provisions of a statute, particularly when the order has adverse civil consequences. (Paras 55 and 58)
        (d) Customs Tariff (Identification, Assessment & Collection of Anti-Dumping Duty on Dumped Articles & for Determination of Injury) Rules, 1995 – Rule 6 – Duty to follow the principles of natural justice is implicit in the exercise of power conferred on the Designated Authority. (Para 59)
        (e) Customs Tariff (Identification, Assessment & Collection of Anti-Dumping Duty on Dumped Articles & for Determination of Injury) Rules, 1995 – Rule 6 – Opportunity of hearing – Notice for oral hearing being in relation to the price undertaking offer cannot be likened to a public hearing contemplated under Rule 6(6) – Principles of natural justice not complied with – Proceeding vitiated – Quashed. (Para 59)
        (f) Doctrine of unjust enrichment – Burden of anti-dumping duty having been absorbed by the exporters and the appellants not showing that they passed the duty to third parties, they are not entitled to refund of the duty. (Paras 62 and 63)
        Facts of the case:
        1. The Association of Synthetic Fibre Industry filed an application before the Designated Authority inter-alia, praying for imposition of anti-dumping duty on imports of NTCF from China.
        2. The DA recorded preliminary findings and issued public notice in that behalf recommending imposition of provisional anti-dumping duty at the rate of US $ 0.69 per Kg on NTCF originating in and exported from China for the period of investigation from 1st April 2002 to 30th June 2003. The recommendations made in the preliminary findings were accepted by the Central Government, and provisional anti-dumping duty was, accordingly, imposed.
        3. On 9th March 2005, the DA issued final findings recommending the imposition of anti-dumping duty on NTCF originating from China at the rate of US $ 0.54 per Kg to US $ 0.81 per Kg.
        4. The Central Government accepted the final findings of the DA, and issued Notification levying anti-dumping duty at different rates varying from US $ 0.54 per Kg to US $ 0.81 per Kg on NTCF w.e.f. 26th July 2004.
        5. The Tribunal held that the imposition of anti-dumping duty being legislative in character, the principles of natural justice were not applicable to the proceedings before the DA and, therefore, persons affected had no right to be heard before the imposition of duty.
       Finding of the Court:
        DA discharges quasi-judicial function.
        Appellants are not entitled to refund of the anti-dumping duty.
       Result : Appeals allowed.

JUDGMENT

D.K. Jain, J. —

1. This batch of civil appeals under Section 130E of the Customs Act, 1962 (for short “the Act”) arises out of a common judgment and order, dated 9th September 2005, passed by the Customs, Excise and Service Tax Appellate Tribunal (for short “the Tribunal) whereby the appeals filed by the appellants herein, have been dismissed and the levy of anti-dumping duty, imposed under Section 9A of the Customs Tariff Act, 1975 (for short “the Tariff Act”) vide Notification 36/2005-Cus dated 27th April 2005 has been affirmed.

2. As common questions of law are involved in all the appeals and even the background facts are identical, these are being disposed of by this common judgment. However, to appreciate the controversy and the rival stands thereon, we shall refer to the facts in Civil Appeal No. 949 of 2006 as illustrative:

The appellant in this appeal viz. Automotive Tyre Manufacturers Association (for short “ATMA”), is an association representing domestic tyre manufacturing units, who import Nylon Tyre Cord Fabric (for short “NTCF”) from various countries, including China, as one of their basic raw materials for manufacture of tyres.

Sometime in 2003, the Association of Synthetic Fibre Industry (for short “ASFI”), respondent No. 3 herein, filed an application under the Customs Tariff (Identification, Assessment & Collection of Anti-Dumping Duty on Dumped Articles & for Determination of Injury) Rules, 1995 (for short “the 1995 Rules”) before the Designated Authority (hereinafter referred to as “the DA”) inter-alia, praying for imposition of anti-dumping duty under Section 9A of the Act, on imports of NTCF from China. In their application, ASFI had specifically contended that China being a non-market economy country, normal value of the export price from that country had to be determined as per the principle contemplated in para 7 of Annexure I to the 1995 Rules.

3. Taking cognizance of the application, on 29th October 2003, the DA initiated investigation by issuing notification in terms of Rules 5 and 6 of the 1995 Rules, indicating the period of investigation from 1st April 2002 to 30th June 2003. After conducting investigations, the DA recorded preliminary findings and issued public notice in that behalf on 30th June 2004, vide Notification No. 14/20/2003-DGAD, recommending imposition of provisional anti-dumping duty at the rate of US $ 0.69 per Kg on NTCF originating in and exported from China. The recommendations made in the preliminary findings were accepted by the Central Government, and provisional anti-dumping duty was, accordingly, imposed vide Notification No. 72/2004-Cus, published on 26th July 2004. It would be of some significance to note here that the 2nd proviso to Rule 13 of the 1995 Rules postulates that the levy of provisional duty, in the first instance, can be for a period of six months, which may be extended by a further period of three months on the request of exporters representing a significant percentage of the trade involved.

4. Being aggrieved, one of the constituent members of ATMA viz. Apollo Tyres Ltd. filed Writ Petition No. SCA/8747/2004 before the Gujarat High Court, challenging the preliminary findings mainly on the ground that the investigation proceedings were in violation of the principles of natural justice and the procedure prescribed by the 1995 Rules. The said writ petition was dismissed by the High Court on 20th July 2004, observing thus:

“we do not think it fit to entertain this petition at this stage, when the interested parties including exporters and importers are provided an opportunity to submit their views and are also assured of oral hearing.”

5. The DA granted a public hearing to all the parties on 1st September 2004. However, on 1st November 2004, the officer functioning as the DA, who had conducted the investigations in the instant case was transferred, and a new officer took over as the DA. On 6th January 2005, the appellants herein, in particular ATMA and Ni

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2011 Supreme(SC) 25

IMPORTANT POINT Designated Authority under Custom Tariff Act discharges quasi-judicial function.

Cases Referred (59)

IMPORTANT POINT
Designated Authority under Custom Tariff Act discharges quasi-judicial function.