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Government moves on anti-subsidy; dumping levies under lens

New Delhi, Nov 21, 2022

At least two judicial pronouncements have taken a dim view of the finance ministry’s decisions against imposing anti-dumping and safeguard duties despite findings and recommendations of the Directorate General of Trade Remedies (DGTR) establishing adverse impact of cheap or subsidised imports on domestic industry.

Several Indian companies and industry bodies have gone to court against the revenue department’s recent decisions, which came after it opted to be selective in imposing anti-dumping or safeguard duties to protect domestic industry. The finance ministry and Niti Aayog are of the view that such actions impact other producers in the chain, while the commerce ministry believes the DGTR recommendations come after establishing adverse impact on domestic producers and are in line with World Trade Organization rules. The commerce department is of the opinion that unless such an action is taken domestic industry will be wiped out.

In one case, the revenue department’s decision to “unilaterally suspend” countervailing duty on certain varieties of stainless steel from China has been quashed and set aside by the Gujarat high court. The agencies concerned have also been asked to complete the sunset review in line with the laid down process. Under the law, a duty is imposed for a specified period and is assessed again after that, which is referred to as sunset review.

The Delhi high court is also hearing a bunch of petitions related to anti-dumping duty.

Hearing a set of cases, theCustoms, Excise & Service Tax Appellate Tribunal asked the Centre to reconsider its decisions in a bunch of cases where it decided against accepting the designated authority’s recommendations. In several cases, where the revenue department in the finance ministry did not bother to communicate its final decision, the tribunal has taken the same view. The law governing anti-dumping cases requires the revenue department to decide on a matter within three months of the DGTR’s recommendations.

“…the decision taken by the Centrenot to impose antidumping duty despite a recommendation having been made by the designated authority for imposition of anti-dumping duty, cannot be sustained and the matter would have to be remitted to the central government for taking a fresh decision on the recommendation made by the designated authority,” it observed.

At least one of the companies, Sterlite Industries, whose complaint regarding safeguard action on single-mode optical fibre had established that there were problems for the domestic industry, had said that the finance ministry’s decision was “arbitrary, unreasoned and bad in law” and should be set aside.

The tribunal, while maintaining the principle of natural justice has to be followed, said, “If the central government forms a prima facie opinion that final findings of designated authority recommending imposition of anti-dumping duty are not required to be accepted, then tentative reasons have to be recorded and conveyed to domestic industry so as to give an opportunity to submit a representation. ”

[The Times of India]

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