Anti Dumping Duty: The Department Has Circumstantial Discretion To Include Exporters Or Importers In The Purview Of 'Domestic Industry'; Gauhati High Court

The review petition was filed by the Century Plyboards Limited against the judgement as regards the concept of domestic industry as defined in Rule 2(b) of the Anti Dumping Rules 1995 (ADR).

The petitioner urged that even after the successive amendments to the definition of domestic industry under Rule 2(b) of the ADR 1995, it was clear that an importer of the article is expressly excluded from the purview of being included in the definition of domestic industry.

The petitioner contended that, according to the definition of 'domestic industry' as defined in Rule 2(b) of the ADR 1995 from time to time, no discretion is vested in the designated authority to also include such producers who are related to the exporters or importers of the dumped article or who are importers themselves, as 'domestic industry' would have to be understood from the definition of the expression 'domestic industry' as provided in the Rules.

The department argued that the evolution of the definition of domestic industry in Rule 2(b) of the ADR 1995 through successive amendments would make it clear that even domestic producers of the dumped article who also import the article to some extent, the designated authority has discretion to include such domestic producers within the meaning of 'domestic industry.' The department advocated resolving the matter by attempting to comprehend the idea of 'domestic industry' as described in Rule 2(b) of the ADR1995, as modified.

The initial definition of 'domestic industry' by providing for an exception that such producers who are related to the exporters or importers of the alleged dumped article or are themselves importers shall be deemed not to form a part of 'domestic industry', explicitly excludes such producers from being included as a 'domestic industry' and no discretion is vested upon the authority to include such producers. The mandatory nature of the provision for such exclusion flows from the definition itself that such producers can be deemed not to form a part of the 'domestic industry'.

The discretion vested in the authorities to include the exporters or importers of the dumped articles or the importers themselves of the dumped articles in the definition of 'domestic industry' as per the notification dated 15.07.1999 has been withdrawn and a specific exclusion thereof has been brought in.

The definition of 'domestic industry' was amended by the notification dated December 1, 2011, in which the word 'only' appearing after the expression 'rest of the producers' in the definition of 'domestic industry' as per the notification dated 27.02.2010, was removed.

The removal of the word 'only' after the expression 'rest of the producers' would have to be interpreted to mean that the absolute exclusion of the producers who are related to the exporters or importers of the dumped article or the importers themselves of the dumped article from the meaning of domestic industry is not an absolute exclusion.

The court observed that the amendments brought in to the definition of 'domestic industry' by the notifications were only in respect of the changes that were brought in on the question of the existence of a discretion on the part of the authorities to include producers who are related to the exporters or importers of the dumped articles or the importers themselves of the dumped articles within the meaning of 'domestic industry'.

"It cannot be understood that inclusion of the word 'only' in the definition of 'domestic industry' as per the notification dated 27.02.2010 had led to an absurdity or anomaly or unless material — intrinsic or external — is available to consider it superfluous. The word 'only' gave a definite meaning to exclude the producers related to the exporters or importers of the dumped article or the importers themselves from the purview of 'domestic industry'. A removal of the word 'only' by the amendment contained in the notification dated 01.12.2011 would therefore have to be construed that such removal had withdrawn the effect of exclusion of such producers and therefore, it cannot be understood that a superfluous word has been removed," the court said.

The court held that the amendment brought in to the definition of 'domestic industry' by the notification dated 01.12.2011 in Rule 2(b) of the ADR 1995 does confer a discretion upon the authorities to include the producers related to the exporters or importers of the dumped article or the importers themselves in the concept of 'domestic industry'. Because of the nature and implications of the successive amendments, the court held that the discretion may not be an absolute discretion but would be circumstantial discretion to be determined on a case-by-case basis.

Case Title: Century Plyboards (I) Limited Versus UOI

Case No. : Review.Pet./9/2020

Citation: 2022 LiveLaw (Gau) 24

Dated: 06.04.2022

Counsel For Petitioner: Advocate A Saraf

Counsel For Respondent: Advocate SC Keyal

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