Legal principle

Where the prescribed procedure (Rule 6(6) of the 1995 Anti-dumping Rules) requires a personal hearing, final findings recorded by a Designated Authority who never heard the interested parties violate audi alteram partem and the duty notification founded on them cannot stand, yet no refund lies where the burden of the duty has been passed on and the dumping findings remain unchallenged.

Court decision

Allowing the appeals in part, the Supreme Court set aside the Tribunal's decision and quashed Notification 36/2005-Cus dated 27.4.2005, holding that the duty to follow natural justice is implicit in Rule 6 of the 1995 Rules and that final findings recorded by a successor DA, who had no occasion to hear the parties, offended the basic principle of audi alteram partem. However, the Court refused refund of duty already collected: the DA's unchallenged sunset-review finding that Chinese exporters had undersold below non-injurious price by 25-20% showed the duty burden had been absorbed by exporters and passed on, and the findings on dumping, injury and causal link were never challenged. The parties were left to bear their own costs.

Facts

ATMA, an association of domestic tyre manufacturers, imports Nylon Tyre Cord Fabric (NTCF) from various countries including China as a basic raw material; ASFI applied to the Designated Authority for anti-dumping duty on NTCF imports from China, a non-market economy. The DA investigated (period April 2002 to June 2003), recommended provisional duty of US$0.69/kg (imposed by Notification 72/2004-Cus dated 26.7.2004) and issued final findings on 9.3.2005 recommending duty of US$0.54 to US$0.81/kg. The officer who conducted the investigation was transferred in November 2004, and the successor DA recorded the final findings without granting the fresh public hearing requested by ATMA and Ningbo Nylon. The Central Government accepted the findings and levied anti-dumping duty by Notification 36/2005-Cus dated 27.4.2005 w.e.f. 26.7.2004, and the Tribunal affirmed the levy, holding that imposition of anti-dumping duty is a legislative function to which natural justice does not apply.

Key provisions

• Section 9A, Customs Tariff Act, 1975 — Anti- dumping duty on dumped articles
• Section 9C, Customs Tariff Act, 1975 — Appeal
• Section 129C, Customs Act, 1962 — Procedure of Appellate Tribunal
• Section 130E, Customs Act, 1962 — Appeal to Supreme Court
• Section 129, Customs Act, 1962 — Appellate Tribunal