CIVIL WRIT PETITION NO.2426 OF 2011 -1- ***** IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH CIVIL WRIT PETITION NO.2426 OF 2011 DATE OF DECISION: 9.2.2011. M/s Merino Panel Products Limited ....Petitioner Versus Union of India and others ...Respondents CORAM : HON'BLE MR. JUSTICE ADARSH KUMAR GOEL HON'BLE MR. JUSTICE AJAY KUMAR MITTAL Present: Mr. Seetha Raman, Advocate with Mr. Atul Gupta and Mr. Sandeep Goyal, Advocates for the petitioner. *** ADARSH KUMAR GOEL, J (Oral) 1. Prayer in this petition is as under:- “(i) For challenging the vires of Customs Tariff (Identification, Assessment and Collection of Anti- Dumping Duty on Dumped Articles and for Determination of Injury) Rules, 1995; and (ii) To quash the Customs Tariff (Identification, Assessment and Collection of Anti-Dumping Duty on Dumped Articles and for Determination of Injury) Rules, 1995 framed under section 9A being ultra vires to the Constitution of India; (iii) For quashing the Notification No.116/2009 dated 8.10.2009 (Annexure P-1) issued by respondent CIVIL WRIT PETITION NO.2426 OF 2011 -2- ***** No.1 and the Notification No.14/12/2007 dated 26.8.2009 (Annexure P-2) issued by respondent no.2; (iv) For the issuance of a writ in the nature of mandamus directing the respondents No.1 and 2 to withdraw and/or cancel the impugned final findings No.14/2/2007/DGAD dated 26th August, 2009 (Annexure P-2) and the consequent Customs Notification No.116/2009 dated 8th October, 2009 (Annexure P-1) issued by Ministry of Finance and implementing the recommendations contained in the said final findings.” 2. Case of the petitioner is that on the basis of an application filed by M/s All India Fibre Board Manufacturers Association, Faridabad/respondent no.3, anti-dumping investigation was initiated by the designated authority on import of Medium Density Fibre Board originated in or exported from China PR, Malaysia, New Zealand, Thailand and Sri Lanka vide initiation notification dated 6th June, 2008. Findings were recorded as notified in the impugned notification dated 8.10.2009. Against the said notification, the petitioner preferred appeal before the Custom Excise and Service Tax Appellate Tribunal (for short “the CESTAT) which has yet not been taken up for hearing. The petitioner applied for early hearing which application is still pending. Since the matter is not being heard by the CESTAT, this petition has been filed. Apart CIVIL WRIT PETITION NO.2426 OF 2011 -3- ***** from challenging the findings on merits, validity of rules has been challenged in the petition mainly on the ground that scope of hearing under Rule 6(5) does not include general public interest and interest of importer who is an interested party under Rule 2(c). In such a situation, the rule does not prescribe fair procedure and is violative of fundamental right under Article 19(1)(g) of the Constitution. 3. We have heard learned counsel for the parties. 4. In view of the fact that appeal of the petitioner is pending before the CESTAT, we do not find any ground to go into merits. The petitioner has applied for early hearing before the CESTAT and the Tribunal may give such priority in hearing as may be appropriate. 5. Since the validity of rule cannot be gone into by the Tribunal, we have considered this aspect. Objection to the validity of rule is based on the contention that scope of hearing under Rule 6(5) was limited to furnishing information relevant to the investigation regarding dumping, injury and causality. We do not find any substance in this contention. 6. Section 9A of the Act enables the Central Government to impose Anti Dumping Duty not exceeding the margin of dumping. Dumping is a process of selling of goods by an exporter from outside India at a very low price for sometime so that domestic industry in India is not able to compete and after domestic industry is destroyed, prices are raised again. Purpose of Section 9A is to maintain level playing field by preventing dumping. To decide whether Anti Dumping Duty is required to be levied, difference between normal CIVIL WRIT PETITION NO.2426 OF 2011 -4- ***** price and export price which is known as 'margin of dumping' is to be ascertained and it has also to be seen whether dumping is causing injury to the domestic industry. Non-injurious price is determined on the basis of cost of production. Anti Dumping Duty can be levied to the extent of margin of dumping. Scheme of the said provisions has been discussed, inter-alia, in Reliance Industries Limited V. Designated Authority (2006) 10 SCC 368. The rules provide for investigation into existence, degree and effect of alleged dumping. The Designated Authority is appointed under Rule 3 by the Central Government. Such authority initiates investigation for which purpose, public notice is issued and opportunity of hearing is given to affected persons. There is no provision for preliminary findings on the basis of which provisional duty not exceeding the margin in dumping can be levied as well as final findings as to export price, normal value and margin of dumping whether as a result of import, there is injury or threat of injury to industry in India and whether there was a link between the injury and the dumped imports. Such findings can be basis of recommendations which enable the Central Government to levy the duty. The rules lay down principles for determination of normal value, export price, margin of dumping and determination of injury. 7. The scope of investigation being focussed on the issues mentioned in rule 6(5), the opportunity of furnishing information given to the interested party has to be relevant to the said matters. Violation of right of the petitioner, if any, as a consequence of finding CIVIL WRIT PETITION NO.2426 OF 2011 -5- ***** recorded on the said matters, is consequential. The provisions for investigation regarding dumping, injury or causality connected therewith are to give effect to the object under Section 9A of the Act of imposing anti dumping duty equal to the margin of dumping. The provision of levy of anti dumping duty is not in any manner violative of fundamental right of the petitioner being a provision to safeguard the interest of the domestic industry. Thus the Rule which is within the scope of main provision is not in any manner unconstitutional. We, thus, do not find any ground to declare the said Rule to be ultra vires the Constitution of India. 6. The writ petition is dismissed. (Adarsh Kumar Goel) Judge February 09,2011 (Ajay Kumar Mittal) Pka Judge