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Judgment
Sanjiv Khanna, J
This order and judgment would decide the issue whether we should exercise our discretion and entertain the present writ petition inspite of the
statutory alternative remedy.
The writ petition prays for the following reliefs:
“a. Issue a writ of Certiorari or Writ in the nature of Certiorari appropriate, or any other appropriate Writ, Order or Direction, strike/ read down the
Rule 25 of the Rules to be ultravires to Section 9A of the Act;
b. Issue a writ of Certiorari or Writ in the nature of Certiorari appropriate, or any other appropriate Writ, Order or Direction, quashing the Impugned
Findings dated 18.08.2017 issued by Respondent No. 2;
c. Issue a Writ of Mandamus, or Writ in the nature of Mandamus, or any other appropriate Writ, Order or Direction restricting the Respondents, from
acting upon the Impugned Notification;
d. Issue a Writ of Prohibition, or Writ in the nature of Prohibition, or any other appropriate Writ, Order or Direction restricting the Respondents, from
acting upon the Impugned Notificationâ€
Amendment application CM No.43275/2017 seeks permission to amend the plaint to challenge notification no.52/2017 - Customs (ADD) dated
24.10.2017 thereby imposing anti-dumping duty, falling under the heading 7219 of the First Schedule to the Customs Tariff Act, 1975 for exports from
Peopleâ€s Republic of China, Korea, European Union, South Africa, Taiwan, Thailand and United States of America.
The petitioner is primarily aggrieved by the note below the table, specifying anti-dumping duty at the rate worked out as percentage of landed value
of import, which reads as under:
Note: The subject goods include cold-rolled Flat products of stainless steel of width greater than 1250 mm of all series not further worked than Cold
rolled (cold reduced) with a thickness of up to 4mm (width tolerance of +30 mm for Mill Edged and +4mm for Trimmed Edged), excluding the
following:
(a) Grades AISI 420 high carbon, 443,441, EN 1.4835, 1.4547, 1.4539, 1.4438, 1.4318, 1.4833 and EN 1.4509;
(b) Product supplied under Indian Patent No. 223848 in respect of goods comprising Low Nickel containing Chromium-Nickel Manganese-Copper
Austenitic Stainless steel and representing Grades YU 1 and YU 4, produced and supplied by M/s Yieh United Steel Corp (Yusco) of Chinese Taipei
(Taiwan).
Further, no anti-dumping duty shall be payable on imports of the subject goods if:
(i) an importer who imports the subject goods for end use in the same form without slitting; or
(ii) slitted it into 2 or more subject goods i.e. sizes above 1250 mm (for example a 2600 mm piece slitted into two 1300 mm size pieces),
Provided that the importer follows the procedure set out in the Customs (Import of Goods at Concessional Rate of Duty) Rules, 2017.
Explanation: Anti-dumping duty shall be payable on the imports of the subject goods if it is slitted for a combination of subject goods and below subject
goods size or below subject goods sizes, (For example, an 1800 mm piece being slit into a 1400 mm and a 400-mm piece or a 2200 mm piece is slit into
1400 mm and 800 mm or a 1400 mm piece being slit into 600, 500 & :300 mm sizes);
This notification shall remain in force up to and inclusive of the l0th December, 2020, unless revoked earlier, from the date of publication of this
notification in the Official Gazette and the anti-dumping duty shall be paid in Indian currency.
Explanation. - For the purposes of this notification, ""Landed Value"" shall be the assessable value as determined under the Customs Act, 1962 (52 of
1962) and all duties of customs except duties levied under sections 3, 3A, 8B, 9 and 9A of the Customs Tariff Act.
It is an accepted and admitted position that the notification can be challenged and questioned by an appeal under Section 9-C of the Customs Tariff
Act, 1975 (“Tariff Act†for short), which for the sake of convenience is reproduced below:
“9C. (1) An appeal against the order of determination or review thereof regarding the existence, degree and effect of any subsidy or dumping in
relation to import of any article shall lie to the Customs, Excise and Service Tax Appellate Tribunal constituted under section 129 of the Customs Act,
1962 (hereafter referred to as the Appellate Tribunal).
1 [(1A) An appeal under sub-section (1) shall be accompanied by a fee of fifteen thousand rupees.
(1B) Every application made before the Appellate Tribunal,-
(a) in an appeal under sub-section (1), for grant of stay or for rectification of mistake or for any other purpose; or
(b) for restoration of an appeal or an application shall be accompanied by a fee of five hundred rupees.
(2) Every appeal under this section shall be filed within ninety days of the date of order under appeal:
Provided that the Appellate Tribunal may entertain any appeal after the expiry of the said period of ninety days, if it is satisfied that the appellant was
prevented by sufficient cause from filing the appeal in time.
(3) The Appellate Tribunal may, after giving the parties to the appeal an opportunity of being heard, pass such order thereon as it thinks fit, confirming,
modifying or annulling the order appealed against.
(4) The provisions of sub-section (1), (2), (5) and (6) or section 129C of the Customs Act, 1962 shall apply to the Appellate Tribunal in the discharge
of its functions under this Act as they apply to it in the discharge of its functions under the Customs Act, 1962.
(5) Every appeal under sub-section (1) shall be heard by a Special Bench constituted by the President of the Appellate Tribunal for hearing such
appeals and such Bench shall consist of the President and not less than two members and shall include one judicial member and one technical
member.â€
The aforesaid provision stipulates that every statutory appeal is to be heard by a Special Bench to be constituted by theÂ
President of the Appellate Tribunal i.e. Customs, Excise and Service Tax Appellate Tribunal. The Appellate Tribunal has powers as stated under
Sub-Sections 1, 2, 5 and 6 of Section 129 C of the Customs Act, 1962 (“Act†for short).
Parties accept that the Appellate Tribunal has the power to pass interim orders and grant stay.
The contention of the petitioner is that this court should entertain the present writ petition notwithstanding the alternative remedy in view of four
exceptions carved out by the Supreme Court in Whirlpool Corporation Vs. Registrar of Trade-marks, Mumbai & Ors. 1998 (8) SCC 1, namely,
enforcement of any fundamental right; violation of principle of natural justice; hearings or proceedings being wholly without jurisdiction; and when
vires of the enactment is challenged. Petitioner also relies upon Association of Synthetic Fibre Industry Vs. J.K. Industries Ltd. 2006 (199) E.L.T. 196
(S.C.).
During the course of hearing it was asserted that anti-dumping duty was imposed on Cold Rolled Stainless Steel (“CRS Steelâ€, for short)
between 600 mm to 1250 mm in thickness. Consciously CRS Steel more than 1250 mm or less than 600 mm in thickness was excluded. Attempts by
domestic industries to include CRS Steel above 1250 mm were raised, considered and rejected on three earlier occasions. However, vide impugned
notification anti-circumvention duty has been imposed on CRS Steel above 1250 mm in an indirect manner vide the impugned note in the notification
by putting conditions which are wholly impracticable and incapable of being met. The petitioner is a manufacturer of CRS Steel in Finland and exports
the CRS Steel including sheets of 1250 mm and above in thickness to India. The petitioner submits that imposition of anti circumvention duty is
contrary to law on the following grounds:
[1] The order and reasoning by the Designated Authority which has been accepted by the Government, is incoherent and contradictory. Reference is
made to some tables in the report of the Designated Authority that anti dumping conversion duty was not justified, as there was no undercutting or
negative pricing in CRS Steel exported by the petitioner to India.
[2] The conditions stipulated for imposition of anti circumvention duty stipulated in Rule 25 of the Customs Tariff (Identification, Assessment and
Collection of Anti-dumping Duty on Custom Goods and for Determination of Injuries) Rule 1995 (“Anti Dumping Rulesâ€, for short) were not
satisfied. Thus there is lack of jurisdiction.
[3] Fourth  respondent  had  moved  the  anti-circumvention application before the designated authority on 21st September,
2015. Between 21st April, 2015 and 11th December, 2015 anti-dumping duty was not applicable/ imposed on imports of CRS Steel. Hence, the
application was not maintainable.
[4] Constitutional validity of Rule 25 of the Anti Dumping Rules has been challenged. Constitutional vires cannot be examined and decided by the
Appellate Tribunal.
There are a plethora of decisions of this Court repeatedly refusing to entertain the writ petitions impugning anti-dumping notification. Reference can
be made to order dated 16th May, 2017 passed in WP(C)No.2632/2017 Hindustan Lever Limited Vs. Union of India, order dated 24th July, 2017
passed in WP(C)No.6267/2017 M/s.Suncity Sheets Pvt. Ltd. Vs. The Designated Authority and Ors., order dated 31st October, 2017 passed in
WP(C)No.9284/2017 Indian Metals and Ferro Alloys Ltd. Vs. The Union of India & Ors. and order dated 4th September, 2017 passed in
WP(C)6430/2011 Deepak Nitrite Limited Vs. Union of India & Anr. These decisions follow an earlier decision in Alcatel-Lucent India Ltd. Vs.
Designated Authority 2016 (338 ELT 397 (Del.)
The respondents have contested each and every assertion made by the petitioner. They have specifically referred to the decision in Deepak Nitrite
Limited (Supra) wherein vires of Annexure- 3 of the Anti Dumping Rules were challenged. Referring to the decision of the Supreme Court in L.
Chandra Kumar Vs. Union of India (1997) 3 SCC 261 and the scope and ambit of the jurisdiction conferred on the Appellate Tribunal, it was observed
that the Tribunal constituted under Article 323-B of the Constitution of India, can consider challenge to the vires of the subordinate legislation.
We need not go that far in the present case for we find that the petitionerâ€s challenge to vires is a misconception. The petitioner seeks consort
and relies on the said Rule.
The exact grounds raised in the writ petition challenging the vires of Rule 25 is as under:
“III. RULE 25 OF THE RULES IS ULTRAVIRES TO SECTION 9A [1A] OF THE CUSTOMS TARIFF ACT, 1975
N. For that Section. 9A [1A] of the Act mandates satisfaction/ existence of pre-condition i.e. import of such article in an ""unassembled or dissembled
form for imposition of anti-dumping duty on account of circumvention.
Rule 25 of the Rules dealing with circumvention of anti-dumping duty has introduced conditions i.e. in an ""unassembled, unfinished or incomplete
form."" Therefore, when compared with Section 9A [1A], the Rule 25 has introduced various other preconditions thereby extending the scope of
invoking circumvention provisions. Thus, the Rule goes beyond the Act to the extent it has added the preconditions other than ""unassembled or
dissembled"" form. It is humbly submitted that ""unassembled or dissembled"" would essentially cover within its scope those products which can fall
under description of CKD or SKD. In the facts of the present case, the product of the petitioner cannot be said to fall under the said scope and
therefore the Rule itself is liable to be struck down or read down for being beyond the section.â€
The submission made is that sub-section (1A) to Section 9A of the Tariff Act permits imposition of anti circumvention duty only when
circumvention takes place either by altering the designation or name or composition of articles or by import of an article in an unassembled or
dissembled form or changing country or its origin for export. This is not correct. Sub-section (1A) to Section 9A, for the sake of clarity, is quoted
below:
“(1A) Where the Central Government, on such inquiry as it may consider necessary, is of the opinion that circumvention of anti-dumping duty
imposed under sub-section (1) has taken place, either by altering the description or name or composition of the article subject to such anti-dumping
duty or by import of such article in an unassembled or disassembled form or by changing the country of its origin or export or in any other manner,
whereby the anti-dumping duty so imposed is rendered ineffective, it may extend the anti-dumping duty to such article or an article originating in or
exported from such country, as the case may be.â€
The section permits imposition of anti-circumvention duty also when imports take place into India in any other manner, whereby, the
anti dumping duty so imposed is rendered ineffective.
Faced with the aforesaid position it was contended on behalf of the petitioner that expression “any other manner†must have a nexus and link
whereby the anti-dumping duty so imposed is rendered ineffective, albeit we observe that this is not an aspect relevant whenÂ
we examine the  question of constitutional vires of Rule 25 on the grounds raised. We would now refer to Rule 25 which is as under:
Rule 25. Circumvention of anti-dumping duty: (1) Where an article subject to anti-dumping duty is imported into India from any country including
the country of origin or country of export notified for the purpose of levy of anti dumping duty, in an unassembled, unfinished or incomplete form and is
assembled, finished or completed in India or in such country, such assembly, finishing or completion shall be considered to circumvent the anti dumping
duty in force if,-
(a) the operation started or increased after, or just prior to, the anti dumping investigations and the parts and components are imported from the
country of origin or country of export notified for purposes of levy of anti dumping duty; and
(b) the value consequent to assembly, finishing or completion operation is less than thirty-five percent of the cost of assembled, finished or complete
article.â€
Explanation I. â€" “Value†means the cost of assembled, complete or finished article less value of imported parts or components
Explanation II. - For the purposes of calculating the “valueâ€, expenses on account of payments relating to intellectual property rights, royalty,
technical know- how fees and consultancy charges, shall not be taken into account.
(2) Where an article subject to anti dumping duty is imported into India from country of origin or country of export notified for the levy of anti-dumping
duty after being subjected to any process involving alteration of the description, name or composition of an article, such alteration shall be considered
to circumvent the anti dumping duty in force if the alteration of the description or name or composition of the article subject to anti dumping duty
results in the article being altered in form or appearance even in minor forms regardless of the variation of tariff classification, if any.
(3) Where an article subject to anti dumping duty is imported into India through exporters or producers or country not subject to anti dumping duty,
such exports shall be considered to circumvent the anti dumping duty in force if the exporters or producers notified for the levy of anti - dumping duty
change their trade practice, pattern of trade or channels of sales of the article in order to have their products exported to India through exporters or
producers or country not subject to anti dumping duty.
Explanation.- For the purposes of this sub-rule, it shall be established that there has been a change in trade practice, pattern of trade or channels of
sales if the following conditions are satisfied, namely: -
(a) absence of a justification, economic or otherwise, other than imposition of anti-dumping duty;
(b) evidence that the remedial effects of the anti-dumping duties are undermined in terms of the price and or the quality of like products.
Sub Rule (1) deals with the first part of Sub-Section (1A) to Section 9A. To this extent, therefore, the petitioner relies upon Sub-Rule (1) in support of
its contention that the anti-circumvention duty should not have been imposed. Referring to Sub -Rule (2) it is submitted that same would not be
applicable for the condition ""after being subjected to any process involving alteration of the description, name or composition of article"" refers to
process of alteration of description, name or composition, which should be before it is imported into India and not after it is imported into India. The
respondent on the other hand has relied upon Sub-Rule (3). Be that as it may, we do not think there is any ground or reason mentioned in the writ
petition which would justify a challenge to the vires of Rule 25 of the Anti-Dumping Rules on the pretext that it violates and is ultra vires to Section 9A
(1A) of the Tariff Act and stipulates imposition of anti-circumvention duty beyond the scope and the ambit of the main enactment.
The petitioner, in fact, relies upon Rule 25 in support of his contention raised and urged before us in the writ petition.
Interpretation of the Rule and its applicability to a particular case and factual matrix, must be distinguished from the challenge to the vires of the
Rule.
Review provided under Article 226 of the Constitution is an extraordinary remedy and the High Courts do not, as a matter of discretion, entertain
Writ Petitions when an equally efficacious remedy is available. This principle applies especially when a machinery is created by the Statute to remedy
and correct any wrong, when a right or liability is created by the same Statute, which also gives special remedy by way of appeal. The appellate
remedy should not normally, and as a routine, be circumvented and bypassed. The aforesaid principle or rule is a self-imposed restriction and a
restraint based on the principle of exhaustion of remedies. This ensures that the persons do not rush to the High Court for issue of a Writ, thereby
rendering the statutory provisions almost meaningless and non-existent.
Way back in 1957, in Union of India versus T.R. Verma, AIR 1957 SC 882, the Supreme Court had observed that where an alternative or an
equally efficacious remedy is open to a litigant, the litigant should be required to pursue that remedy and not invoke jurisdiction to issue a prerogative
writ. Existence of an alternative remedy does not affect the jurisdiction of the Court to issue a writ, but it would be a good exercise of discretion to
refuse to entertain a writ petition unless there are extenuating and special grounds. The reason is that the Writ Jurisdiction is not meant to correct
errors like appellate courts. When rights and duties are created by a Statute, which is meant to be a complete code, the parties should first exhaust the
remedies for redressal of grievance and correction of errors.
Following this dictum, the Writ Courts in the absence of exceptional circumstances have refused to entertain writ petitions and to proceed with
judicial review where the invoker has failed to exhaust or take recourse to alternative remedies. Requirement to exhaust the alternative remedies is
considered to be fair and just as legislation has created an avenue for redress. This makes access to justice available locally, prevents the Writ Courts
from being over-burdened with cases, and is based upon the precept that the appellate or specialized bodies have more expertise on the subject.
Sometimes it is observed that they are substitute for judicial review.
The prefix “wholly†before the term “jurisdiction†in Whirlpool Corporation (supra) is significant and not otiose. The term
“jurisdiction†in strict sense refers to the competence of the authority or the tribunal at the commencement of the proceedings. This requires
examination whether the jurisdiction was initially properly assumed. Thereafter, it is within the jurisdiction of the tribunal/authority to decide. This pure
theory of jurisdiction makes a distinction between jurisdictional questions of fact and law, which are sometimes also called as collateral facts and law,
and facts and law which are not jurisdictional (see Paripooran J.'s views as expressed in Mafatlal Industries Limited and Others versus Union of India
and Others, reported in (1997) 5 SCC 536, vide paragraphs 334 to 338 and pages 797 to 803 in Principles of Statutory Interpretation by G.P. Singh,
Thirteenth Edition, 2012). Referring to the aforesaid distinction, V.S. Deshpande, J. in R.K. Gupta versus Delhi Administration, ILR (1978) 2 Del 82,
had observed:-
The question arose for the first time if the words “any other remedy†in clause (3) of Article 226 included the remedy by way of suit after the
Constitution (42nd Amendment) Act, 1976. In resolving the question, the material reasoning should, in my opinion, be as follows:
(1) & (2) xxxx
(3) Grounds for awarding certiorari and prohibition, according to Prof. S.A. De Smith in “Judicial Reviews of Administrative Action†Third
Edition, pages 249 to 263, are (a) lack of Jurisdiction, (b) breach of the Rules of Natural Justice, (c) Error of law on the Face of the Record, and (d)
Fraud or Collusion. Initially, lack of jurisdiction was considered at the inception only. Once the jurisdiction was legally assumed any error in its exercise
was an error within jurisdiction not amounting to lack of jurisdiction. Later, however, judicial decisions, such as Ridge v. Baldwn, (1964) A.C. 40 (3),
and Anisminic Ltd. v. Foreign Compensation Commission, (1969) 2 A.C. 147 (4), broadened the concept of jurisdiction to include error committed
after initial assumption of jurisdiction. Similarly, the concept of error apparent on the face of the record was broadened to include any such error as
would appear to be apparent to the particular Judge or Judges deciding a particular case.
As noticed above, the rule of exhaustion of remedy is not an absolute and inflexible rule and, therefore, the Writ Courts practice some degree of
flexibility depending upon the facts of each case. A Writ can be entertained where the authority or tribunal lacks subject matter jurisdiction or has
assumed jurisdiction in the absence of jurisdictional fact, for these are treated as pre-requisite for assuming jurisdiction at the inception. Such cases
can be distinguished from cases where there are errors made in exercise of jurisdiction or sometimes even errors in excess of jurisdiction. These are
treated as errors within the jurisdiction. For example, in the case of Whirlpool Corporation (supra), a writ petition was filed challenging the notice
issued by the Registrar on the ground that he had no power to issue such notice. The Supreme Court observed that the High Court was not right in
dismissing the writ petition on the ground of failure to exhaust alternative remedy as the issue related to jurisdiction in strict sense. Reference was
made to the earlier decision of the Constitution Bench in Calcutta Discount Company Limited versus Income Tax Officer, Companies District I
Calcutta and Another, AIR 1961 SC 372, a case which related to re-opening of assessment by the Income Tax Officer. The question was whether
the jurisdictional facts for reopening an assessment were satisfied or the Income Tax Officer was acting without jurisdiction.
As a matter of caution, we would observe that the Courts have held that it is undesirable to lay down inflexible rules and, therefore, the dictum
with reference to the pure theory of jurisdiction may have limitations and cannot be applied as a universal principle. Nevertheless, it is necessary to
keep in mind the distinction between lack of jurisdiction and an alleged error in exercise of jurisdiction, i.e. a wrong or erroneous order. Parameters for
interference in exercise of writ jurisdiction, inspite of alternative remedy in the two situations is different. In the former it is wider, while in the latter
the Writ Court would be extra cautious and good reasons would be required to side step alternative remedy. In the context of the present case, and
the submissions and counter to the same, it can, safely and without hesitation, be held that challenge is not to the lack of jurisdiction at the time of
initiation but to purported failure to correctly apply the law and exercise jurisdiction. These issues can be appropriately and properly dealt with in the
appellate proceedings. No special ground or reason is made out for the petitioner to ignore and to not adhere to and exercise the Statutory Appellate
right.
It may be relevant to state here that the petitioner had impleaded itself as a co-petitioner in Writ Petition (C) No. 3544/2016, M/s Suncity Sheets
Private Limited versus Union of India and Others, in which challenge was made to notification dated 19th February, 2016 initiating investigation into
circumvention duty on imports of CRS Steel sheets and coils of width above 1250 mm. By judgment dated 8th March, 2017, the challenge was
rejected by a Division Bench of this Court. The petitioner, no doubt, has filed Special Leave to Appeal against the said decision, which has been
granted, but without interim stay. The Designated Authority had thereafter submitted their report and thereupon notification No. 52/2017 dated 24th
October, 2017 has been issued by the Ministry of Finance.
In the aforesaid context of lack of jurisdiction, the petitioner had urged that the initiation of proceedings were bad, as the fourth respondent,
namely, M/s Jindal Stainless Steel Limited had moved an application for imposition of anti-circumvention duty on 21st September, 2015, i.e., during the
period between 21st April, 2015 and the 11th September, 2015, when anti-dumping duty was not in force. This point or issue has not been specifically
raised in the writ petition, but we find that there is also power of suo motu imposition. The writ petition, which is rather detailed, refers to earlier
applications moved by the fourth respondent for imposition of anti-dumping duty on CRS steel with the width of above 1250 mm, which was not
accepted at the time of issue of notification No.14/2010 dated 20th February, 2010, imposing anti-dumping duty with effect from 22nd April, 2009, mid-
term review resulting in notification dated 7th February, 2012, and then the sunset review notification dated 11th December, 2015 continuing with the
imposition of anti-dumping duty. The writ petition, in fact, refers to the application made by the fourth respondent in 2012 for initiation of anti-
circumvention investigation and updating of the said application thereafter, pursuant to which notification No.14/01/2014-DGAD dated 19th February,
2016 was issued initiating circumvention proceedings. We have deemed it appropriate and proper to refer to the factual position as mentioned in the
writ petition, only to highlight that the said aspect with regard to assumption of jurisdiction on the basis of application made by the fourth respondent
would be appropriately appreciated and gone into in the appellate proceedings, and should not be made a subject matter of the writ proceedings
circumventing"" and ignoring the statutory right to appeal.
In view of the aforesaid discussion, we are not inclined to entertain the present writ petition and leave it open to the petitioner to invoke the
statutory remedy by way of appeal before the Appellate Tribunal. We clarify that the observations made above are for the purpose of deciding the
present writ petition and would not be construed and treated as findings on merits on the question of imposition of anti-circumvention duty on CRS
Steel, vide and in terms of the Note in the Notification No. 52/2017. We are, therefore, not issuing notice on the application for amendment of the writ
petition. There would be no order as to costs.