RELIANCE INDUSTRIES LTD. versus DESIGNATED AUTHORITY AND ORS.

Citation: [2006] SUPP. 6 S.C.R. 1 · Decided: 11-09-2006 · Supreme Court of India · Bench: ASHOK BHAN · Disposal: Disposed off

Judgment (excerpt)

) 
RELIANCE INDUSTRIES LTD. 
v. 
DESIGNATED AUTHORITY AND ORS. 
SEPTEMBER 11, 2006 
[ASHOK BHAN AND MARKANDEY KA TJU, JJ.] 
Customs Tariff Act, 1975/Customs Tariff (Identification, Assessment and 
Collection of Anti-dumping Duty on Dumped Articles and for Determination 
of Injury) Rules, 1995: 
Ss. 9-A and 9-B/Rules 4, 7 and I 7-Anti-dumping duty-Levy of-
Computation of Non-Injurious Price (NIP)-Designated Authority taking 
A 
B 
c 
into account actual cost of electricity captively produced and not its market 
price-D.A. also computing NIP on the basis of best capacity utilization 
achieved in preceding three years-DA computing NIP much lower than D 
computed by the company and claiming confidentiality in disclosing reasons 
and detailed calculations to company-Held, for determining NIP, DA is 
required to take into account market value of inputs and not their actual 
cost of captive production-lnjw)' determination is for the domestic industry 
as a whole and not for individual companies-Apportionment of fixed cost 
has to be done on basis of actual production during the period of investigation E 
and not on optimum capacity utilization-Notification of Central Government 
uls 9-A is quasi-/udicial-Rule 7 does not contemplate any right in DA to 
claim confidentiality, particularly, regarding information which pertains to 
the party which has supplied the same-Failure of DA to provide detailed 
costing information to appellant was illegal. 
s.9-A-Anti-dumping duty-Object of-discussed. 
Words and Phrases: 
F 
"Margin of dumping", "margin of injWJ' ", "normal value"', "non-
injurious price"(NJP), "Positive dumping margin"-Connotation of in the G 
context of anti-dumping law. 
Appellant-company was, manufacturing inter alia, Pure Terophatalic 
Acid (PTA). It had a captive power plant from which it drew electricity for 
manufacturing PTA. For this purpose it also drew electricity from Grid. It 
H 
2 
SUPREME COURT REPORTS [20061 SUPP. 6 S.C.R. 
A transferred the electricity drawn from its captive power plant to its PTA unit 
at the market rate. The appellant filed an application seeking imposition of 
anti-dumping duty on PT A originated or exported to India from Japan, Malaysia, 
Spain and Taiwan. Resultantly, on the basis of the findings of the Designated 
Authority, the Central Government imposed anti-dumping duty on PTA 
B originated in or exported to India from Spain. However, no such duty was 
imposed on exports from the other countries. The appeal of the company filed 
before the CEGA T seeking enhancement of the duty in case of export from 
Spain and imposition of duty on exports from the said other countries was 
dismissed. Aggrieved, the company filed the present appeal. 
c 
It was contended for the appellant that the findings of the Tribunal were 
erroneous in the context of certain imports because of an incorrect 
computation of the NIP for the domestic industry made by the Designated 
Authority. It was s11bmitted that while computing the NIP of PT A, the DA ought 
to have taken the transfer price (market value) of electricity and other inputs 
D 
captively produced by the company; and not the actual cost of production, in 
other words, the cost of inputs was to be seen not for an individual unit, but 
the market price of the inputs was to be seen in order to calculate the NIP. It 
was further contended that the DA has not given any reasoning for coming to 
its conclusion with regard to NIP; and the Disclosure Statement issued by 
the DA does not state as to what was the element of cost being disallowed and 
E what was the reason for doing so. It was submitted that there was no 
requirement in the present case to keep any confidentiality from the appellant 
with regard to computation of NIP. 
Disposing of the appeal, the Court 
F 
HELD: I. The purpose ofs.9-A of the Customs Tariff Act, 1975, which 
was inserted by the Customs Tariff (Second Amendment) Act, 1982, providing 
for imposition of anti-dumping duty, was that our industries which had been 
built up after independence with great difficulties must not be allowed to be 
destroyed by unfair competition of some foreign companies. The purpose of 
G 
the section is, therefore, to maintain a level-playing field and prevent dumping, 
while allowing for healthy competition. The purpose is not protectionism in 
the classical sense but to prevent unfair trade practices. The 1995 
Amendment to Section 9A was apparently made in pursuance to Article VI of 
the Genera

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