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Wednesday, October 12, 2016

“Whether the interpretation placed upon Rule 7 of the Rules is correct insofar as it diminishes the rule of confidentiality statutorily provided for under Rule 7.”= we direct the cases to be posted before appropriate Bench for disposal on merits and in the light of our answer to the question referred and considered.

                                                                  REPORTABLE

                        IN THE SUPREME COURT OF INDIA

                        CIVIL APPELLATE JURISDICTION

                        CIVIL APPEAL NO. 1679 of 2010

Union of India & Anr.                              …..Appellants

      Versus

M/s Meghmani Organics Ltd. & Ors.            …..Respondents

                                   W I T H

                        S.L.P.(C) No. 14099 of 2015,

                         S.L.P.(C) No. 14524 of 2015

                                     AND

                     CIVIL APPEAL NOS. 3498-3500 of 2004



                               J U D G M E N T


SHIVA KIRTI SINGH, J.

While hearing special leave petition against a judgment of  the  Delhi  High
Court, the Division Bench on January 27, 2009  in  the  case  of  Designated
Authority, Ministry of Commerce and Industry  &  Anr.  v.  Indian  Metals  &
Ferro Alloys Limited[1] noticed that in the  context  of  interpretation  of
anti-dumping provisions of the Customs  Tariff  Act,  1975  (in  short  “the
Act”) and the Customs Tariff (Identification, Assessment and  Collection  of
Anti-Dumping Duty on Dumped  Articles  and   for  Determination  of  Injury)
Rules, 1995 (for brevity “the Rules”), the Delhi High Court had allowed  the
writ petition mainly by following the judgment of this Court in the case  of
Reliance Industries Ltd. v. Designated Authority &  Others[2]  and  also  by
following interpretation of Section 9-A(5) given in Rishiroop  Polymers  (P)
Ltd. v. Designated Authority & Additional Secretary.[3] At the  instance  of
counsel for the petitioners in that case, in paragraph 5 of  that  judgment,
the Division Bench recorded its views that Reliance Industries  case  needed
a fresh look and two questions needed to be dealt with by  a  larger  Bench.
Since the first question, as per  submissions  of  all  the  parties  is  no
longer relevant on account of subsequent amendment of the Act, we take  note
of only the other relevant question requiring answer  by  this  Bench.   The
question reads thus:
“Whether the interpretation placed upon Rule  7  of  the  Rules  is  correct
insofar as it diminishes the rule of  confidentiality  statutorily  provided
for under Rule 7.”

Learned counsels for the rival parties have  advanced  submissions  only  in
relation to the aforesaid question of law and  not  on  the  merits  of  the
matters on an understanding  that  the  matters  shall  be  disposed  of  by
competent  Benches  in  the  light  of   our   answer   to   the   aforesaid
question/issue of law.
At the outset we record that it is the Union of  India  and  the  Designated
Authority who have sought for a relook in respect of interpretation of  Rule
7 of the Rules  as  flowing  from  the  case  of  Reliance  Industries  Ltd.
(supra). Mr. Yashank Adhyaru, learned  senior  advocate  appearing  for  the
appellants in Civil Appeal No. 1679 of 2010 has argued that  appeal  as  the
lead matter. According to him the view  taken  in  the  Reliance  Industries
case whittles down the effect of Rule 7  and  unless  we  re-state  the  law
differently, the Designated Authority (hereinafter referred to as “the  DA”)
will be forced to disclose materials which are otherwise  protected  by  the
confidentiality provisions in Rule 7. According to learned  senior  counsel,
the Division Bench in Reliance  Industries  case  noticed  and  extracted  a
passage from the earlier judgment of a co-ordinate  Bench  in  the  case  of
Sterlite Industries (India) Ltd. v. Designated  Authority,  M/o  Commerce  &
Others[4] but erred in taking a  somewhat  different  view  by  a  misplaced
reliance upon the view taken by the Constitution Bench in S.N. Mukherjee  v.
Union of India.[5]
To the contrary, as we shall notice hereinafter, a stand has been  taken  by
the counsels appearing for the parties who have made complaints of  dumping,
that Rule 7 has  been  correctly  understood  and  interpreted  in  Sterlite
Industries Ltd. (supra) casting duty upon the DA to examine  and  decide  on
case to case basis whether information  supplied  is  required  to  be  kept
confidential or not. The whole of the paragraph 3 of that judgment has  been
highlighted to submit that it is for  the  DA  to  decide  in  any  relevant
situation   whether   a   particular    material/information    for    which
confidentiality has been claimed, is required to be  kept  confidential.  Of
course the Appellate Authority namely CEGAT will always have  the  power  to
look  into  the  relevant  files  including   the   materials   treated   as
confidential for deciding the issues raised in appeal.
With a view to place Rule 7  and  other  relevant  rules  in  their  correct
perspective, we have been taken through Sections  9A,  9B  and  particularly
sub-section (2) of Section 9B of the Act. Section 9A clarifies  as  to  when
an article exported from any country or territory to India at less than  its
normal value may be subjected to an  anti-dumping  duty  not  exceeding  the
margin of dumping in relation to such article. By the  aid  of  explanation,
margin of dumping has been clarified as the difference  between  the  export
price and the normal value of an article. The meaning of  export  price  and
normal value require some factual investigation to find out whether  dumping
has taken place  or  not  and  if  yes,  what  is  the  margin  of  dumping.
Therefore, sub-section (6) of Section 9A not  only  authorizes  the  Central
Government to ascertain and determine after necessary  enquiry,  the  margin
of dumping but also empowers it  to  make  rules  for  identifying  articles
liable for anti-dumping duty and for the manner in which the  export  price,
the normal value and the margin of dumping  in  relation  to  such  articles
need to be determined as well as for the assessment and collection  of  such
anti-dumping duty. Section 9B (1) states  the  circumstances  and  situation
when an article shall not be  subjected  to  countervailing  duty  or  anti-
dumping duty under Sections 9 and 9A. However, sub-section  (2)  of  Section
9B empowers the Central  Government  to  frame  the  rules  under  which  an
investigation may be made for the purpose of Section 9B to meet  exceptional
situation contemplated by Section 9B(1)(b)(ii).
The Central Government framed  and  notified  the  rules  on  01.01.1995  in
exercise of powers conferred by sub-section  (6)  of  Section  9A  and  sub-
section (2) of Section 9B of the Act. There is no  dispute  that  the  Rules
are based largely upon  an  International  Agreement  on  implementation  of
Article VI of the General Agreement on Tariffs and Trade 1994  (for  brevity
“GATT  1994”).  Under  this  Agreement  all  the  members  including   India
concurred on the broad principles for applying  anti-dumping  measures  only
under the circumstances  provided  for  in  Article  VI  of  GATT  1994  and
pursuant  to  investigation  in  accordance  with  the  provisions  of   the
Agreement. Let us take a bird’s eye–view of its relevant  Articles.  Article
5 of the Agreement contains provisions for initiation of  investigation  and
its completion in respect of an alleged dumping. The initiation  has  to  be
generally upon a written  application  by  or  on  behalf  of  the  domestic
industry.  In special circumstances the DA  may  initiate  an  investigation
even without a written application provided it has  sufficient  evidence  of
dumping. A time limit of one year  to  eighteen  months  is  prescribed  for
concluding the investigation. Article  6  deals  with  “Evidence”  which  is
generally to be made known  to  all  interested  parties  except  where  the
information is confidential. Paragraphs 2, 4,  5  and  8  under  Article  6,
shown as paragraphs 6.2, 6.4, 6.5 and 6.8 have  ample  connection  with  the
matter at hand and hence they are extracted herein below:

“6.2 Throughout the anti-dumping investigation all interested parties  shall
have a full opportunity for the defence of their interests.   To  this  end,
the authorities shall, on request, provide opportunities for all  interested
parties to meet those parties  with  adverse  interests,  so  that  opposing
views may be presented and rebuttal arguments offered.   Provision  of  such
opportunities must take account of the need to preserve confidentiality  and
of the convenience to the parties.  There shall  be  no  obligation  on  any
party to attend a meeting, and failure to do so shall not be prejudicial  to
that party’s case.   Interested  parties  shall  also  have  the  right,  on
justification, to present other information orally.

6.3         XXXXXXXXXXXX

6.4    The   authorities   shall   whenever   practicable   provide   timely
opportunities for all interested parties to sell  all  information  that  is
relevant to the presentation of their cases, that  is  not  confidential  as
defined in paragraph 5, and that is used by  the  authorities  in  an  anti-
dumping investigation, and to prepare presentations on  the  basis  of  this
information.

6.5   Any information which is by nature confidential (for example,  because
its  disclosure  would  be  of  significant  competitive  advantage   to   a
competitor or because its disclosure  would  have  a  significantly  adverse
effect upon a person supplying the information or upon a  person  from  whom
that  person  acquired  the  information),  or  which  is  provided   on   a
confidential basis by parties to an investigation  shall,  upon  good  cause
shown, be treated as such by the authorities. Such information shall not  be
disclosed without specific permission of the party submitting it.

6.5.1  The  authorities   shall   require   interested   parties   providing
confidential information  to  furnish  non-confidential  summaries  thereof.
These summaries shall  be  in  sufficient  detail  to  permit  a  reasonable
understanding of the substance of the information  submitted  n  confidence.
In  exceptional  circumstances,  such  parties  may   indicate   that   such
information  is  not   susceptible   of   summary.   In   such   exceptional
circumstances, a statement of the reasons why summarization is not  possible
must be provided.

6.5.2 If the authorities find that a  request  for  confidentiality  is  not
warranted and if the supplier of the  information  is  either  unwilling  to
make the information public or to authorize its  disclosure  in  generalized
or summary form, the authorities may disregard such  information  unless  it
can be demonstrated to their satisfaction from appropriate sources that  the
information is correct.

6.6              XXXXXXXXXX

6.7              XXXXXXXXXX

6.8 In cases in which any interested party refuses access to,  or  otherwise
does not provide,  necessary  information  within  a  reasonable  period  or
significantly   impedes   the   investigation,   preliminary    and    final
determinations, affirmative or negative, may be made on  the  basis  of  the
facts available. The provisions  of  Annex  II  shall  be  observed  in  the
application of this paragraph.

Before adverting to Rule 7 which  is  of  prime  significance,  it  will  be
useful to notice the relevant Rules also.  Rule  2  embodies  definition  of
various terms such as ‘domestic industry’, ‘interested party’ etc.  Rules  3
and 4 relate to appointment of Designated Authority and its duties.  Rule  5
relates to initiation of investigation. Usually it is done  upon  a  written
application by or  on  behalf  of  the  domestic  industry  but  in  certain
circumstances it may be initiated suo motu by  the  DA  on  being  satisfied
from the information received from  the  Collector  of  Customs  as  to  the
existence of certain circumstances. The  DA  has  the  duty  to  notify  the
Government  of  exporting  countries  before  proceeding  to   initiate   an
investigation. Rule  6  contains  principles  governing  investigations.  It
includes provisions for issuance of public notice notifying the decision  to
initiate an investigation with adequate informations  of  specified  nature.
The copy of the public notice is to be given to all known exporters  of  the
article involved  in  the  alleged  dumping,  the  Government  of  exporting
countries concerned and other interested parties. Copy  of  the  application
alleging dumping is also to be made available  to  all  concerned  as  noted
above. The DA has power to issue a notice calling  for  any  information  in
the  specified  form  from  the  exporters,  foreign  producers  and   other
interested parties within a time bound  schedule.  The  DA  is  required  to
provide  opportunity  of  furnishing  relevant  information  even   to   the
industrial users of the article under investigation  and  to  representative
consumer organizations (in appropriate cases). Rule 6 (7) obligates  the  DA
to “make available the evidence presented to it by one interested  party  to
the other interested parties, participating in the  investigation.”  Rule  7
is as follows:
“Rule  7.     Confidential  information  –  (1)   Notwithstanding   anything
contained in sub-rules (2), (3) and (7) of rule 6, sub-rule (2) of rule  12,
sub-rule (4) of rule  15  and  sub-rule  (4)  of  rule  17,  the  copies  of
applications  received  under  sub-rule  (1)  of  rule  5,  or   any   other
information provided to the designated authority on a confidential basis  by
any party in  the  course  of  investigation,  shall,  upon  the  designated
authority being satisfied as to its confidentiality, be treated as  such  by
it and no such information shall be disclosed to  any  other  party  without
specific authorization of the party providing such information.

2.     The  designated  authority  may   require   the   parties   providing
information  on  confidential  basis  to  furnish  non-confidential  summary
thereof and if, in the opinion of a party providing such  information,  such
information is not susceptible of summary, such  party  may  submit  to  the
designated authority  a  statement  of  reasons  why  summarization  is  not
possible.

3.    Notwithstanding anything contained in sub-rule (2), if the  designated
authority  is  satisfied  that  the  request  for  confidentiality  is   not
warranted or the supplier of the information is  either  unwilling  to  make
the information public or to authorize its disclosure in  a  generalized  or
summary form, it may disregard such information.”

Only to complete the bird’s eye view of the Rules, it may be noted  that  as
per Rule 8 the  DA  has  to  satisfy  itself  as  to  the  accuracy  of  the
information supplied by the interested parties if findings  are  based  upon
such information. Rule 12 contains details as to  how  preliminary  findings
are to be arrived at and a public notice to be issued  of  such  preliminary
findings. Provisional duty  may  be  levied  on  the  basis  of  preliminary
findings, by the Central Government, as empowered by Rule  13.  Rule  17  is
similar to Rule 12 but deals with  the  final  findings  which  have  to  be
arrived at normally within one year  of  investigation  and  in  exceptional
cases within further period of six months provided  the  Central  Government
grants the extension. The DA is required  to  issue  public  notice  of  its
final findings also. Rules 13 and 18 whereunder the  Central  Government  is
empowered to levy provisional duty on the basis of preliminary  findings  or
duties as per final findings, as the  case  may  be,  demonstrate  that  the
findings of the DA recorded after investigation are of immense  significance
though they look recommendatory in nature. Therefore, the  investigation  is
required to be carried on in a fair manner by issuance of public  notice  at
relevant stages and after informing all interested parties so that they  may
also have their say. The Central Government appears to have a discretion  in
the matter of determining the quantum of provisional duty as well  as  final
duty but with a clear limitation that anti-dumping duty  cannot  exceed  the
margin of dumping as determined by the DA.
Since Mr. Yashank Adhyaru, learned senior advocate for the  Union  of  India
has based his criticism of the judgment in Reliance Industries on the  basis
of observations in paragraph 43 of that judgment,  the  same  is  reproduced
hereinbelow:
“43.  In our opinion, Rule 7 does not contemplate any right  in  the  DA  to
claim confidentiality, Rule  7  specifically  provides  that  the  right  of
confidentiality  is  restricted  to  the  party   who   has   supplied   the
information, and that party has also to satisfy the DA that  the  matter  is
really confidential. Nowhere in the rule has it been provided  that  the  DA
has the right to claim confidentiality, particularly  regarding  information
which pertains to the party which has supplied  the  same.  In  the  present
case, the DA failed to provide  the  detailed  costing  information  to  the
appellant on the basis of which it computed NIP, even though  the  appellant
was the sole producer of the product under consideration,  in  the  country.
In our opinion this was clearly illegal, and not contemplated by Rule 7.”


Elaborating his points further, learned senior  counsel  for  the  Union  of
India submitted that the very opening sentence of above quoted para 43  lays
down an incorrect proposition of law that Rule 7 does not permit the  DA  to
claim confidentiality and that right to make such a claim is vested only  in
a party who has supplied the particular information.  The use  of  the  term
‘any party’ in the opening sentence of Rule 7(1) in place of the  expression
‘interested party’, according to learned counsel, indicates that the DA  may
receive in course of his suo motu action certain  confidential  informations
and in such a situation if he is satisfied that the confidentiality of  such
information needs to be protected and should not be disclosed to  any  other
party without specific authorisation, the DA may be justified in his  action
whereby he himself claims confidentiality in appropriate cases  without  any
party exercising the right of confidentiality.
To buttress his aforesaid stand learned senior counsel placed emphasis  upon
Articles 6.2 and 6.5 of GATT 1994.  By placing reliance  upon  paragraph  23
of the judgment in the case of Commissioner of Customs,  Bangalore  v.  G.M.
Exports[6]  he  submitted  that  in  the  light  of  Article  51(c)  of  the
Constitution of India, in a situation where  India  is  a  signatory  to  an
international Treaty or Agreement and a statute is made to enforce a  treaty
obligation, then in case of any difference  between  the  language  of  such
statute and a corresponding provision of the Treaty, the statutory  language
should be interpreted in the same sense as the language of  the  Treaty.  In
abstract the proposition is salutary and needs no caveat. Articles  6.2  and
6.5 have already been extracted earlier.  In essence, Rules 6 and 7  of  the
Rules ensure the obligations flowing from Articles 6.2, 6.4 and 6.5.   While
interested parties are entitled to have full  opportunity  to  defend  their
interests, such opportunities need to be hedged  by  the  need  to  maintain
confidentiality.  Informations other than confidential must be shown to  all
interested parties whenever  practicable  in  terms  of  Article  6.4.   Any
information which is by nature  confidential  or  which  is  provided  on  a
confidential basis  is  required  to  be  treated  as  confidential  by  the
authorities but only  on  being  satisfied  by  good  cause  shown  for  the
confidentiality claimed.  No doubt the opening clause of Article 6.5  covers
any information which is by nature confidential but the  examples  indicated
therein clearly  reveal  that  such  information  is  required  to  be  kept
confidential because if revealed it would give significant  advantage  to  a
competitor  or  would  have  significant  adverse  effect  upon  the  person
supplying the information or his resource person from whom he  acquired  the
information.  The submission that DA is entitled  to  presume  such  effects
without any claim being made by the  party  supplying  the  information  is,
however, not acceptable  for  reasons  more  than  one.   The  examples  are
clearly meant to be only a guiding factor for the DA who cannot by  exercise
of discretion presume confidentiality and thereby  restrict  the  rights  of
the interested parties to see relevant informations that may be used by  the
DA for the investigation. The DA, being  a  statutory  investigator,  cannot
assume for himself the role of a party for the purpose  of  Rule  7  and  to
claim as well as accept on information to be confidential.
The other reason is provision of appeal under Section 9C of  the  Act.   The
appeal provided is 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.  It is  one  thing  to  use  confidential
information for  the  purpose  of  investigation  on  account  of  statutory
provisions and not communicating the same.  It  is  quite  another,  not  to
maintain transparent records of reasons as to why claim  of  confidentiality
made by any party has been accepted by the DA.  Where  appeal  is  provided,
the appellate authority  will  definitely  be  entitled  to  look  into  the
records  including  the  confidential  information  as  well  as  into   the
correctness of the decision for accepting a claim of  confidentiality.   The
situation is similar to one under the administrative law where a policy  may
exempt the authority from requirement of communicating its  reasons  for  an
administrative decision/order affecting rights and interests of parties  but
certainly  reasons  must  exist  in  the  records  so  as  to  justify   the
reasonableness and fairness of the decision if it has adverse  effects  upon
any party.  Any court or tribunal exercising judicial review is entitled  to
call for the records to satisfy itself as to the  existence  of  reasons  in
appropriate cases involving a challenge to such order.  In case  the  DA  is
conceded power to gather informations from  sources  other  than  interested
parties, he must not treat  such  information  as  confidential  unless  the
party which has supplied  the  information  makes  a  request  to  keep  the
information confidential.  Even in such a situation  where  an  uninterested
party claims confidentiality in respect  of  information  supplied,  as  per
Rule 7, the  DA  has  to  take  all  necessary  precautions  to  decide  the
genuineness of such claim.  In appropriate cases he must ask for summary  of
the information and if that is also not possible, the reasons as to  why  it
is  not  possible  should  be  supplied  for  scrutiny.   The   reasons   of
confidentiality must be discernible on scrutiny of records by the  appellate
authority  because  of  mandate  of  Rule  7(3)  that  if   the   claim   of
confidentiality is  not  worthy  of  acceptance,  or  the  supplier  of  the
information is unwilling to make the information  public  without  any  good
reasons, the DA has to disregard such information.
The aforesaid discussion leads to the  conclusion  that  even  the  relevant
provisions in the GATT 1994 relied  upon  on  behalf  of  appellant  do  not
require the interpretation of Rule 7 in the manner sought for on  behalf  of
the Union of India or the DA.
Mr.  Basava  Prabhu  Patil,  learned  senior  advocate  appearing  for   the
petitioner – Moser Baer India Ltd. – in one of the SLPs has taken  pains  to
refer to various  paragraphs  of  the  judgment  in  the  case  of  Reliance
Industries to submit that the said judgment  was  rendered  in  an  entirely
different context which did not involve detailed discussion of Rule  7.   On
the basis of para 23 of the judgment it was shown that the two  main  issues
falling  for  determination  were  –  (1)   the   correct   principles   for
determination of  Non Injurious Price (NIP) of PTA, and  (2)  the  scope  of
Rule 7 of the Rules.  Referring to para 37 of the judgment, he  pointed  out
that the Court had directed for revising NIP by taking the market  price  of
electricity and  the  actual  capacity  utilisation  during  the  period  of
investigation.  Since the DA in  that  case  had  refused  to  disclose  its
findings even to the person who had  supplied  the  information  leading  to
such findings, the  court  observed  thus  :  “Further,  the  DA  should  be
directed not to misuse Rule 7, by  keeping  confidential  its  findings  and
that too from the person who has supplied the information to it.”   In  para
39 it was held that the proceedings before the DA are quasi judicial.   Then
came a reiteration in para 41 in the following words :

“41. The DA claimed confidentiality from the appellant about its finding  on
the data supplied by the  appellant  itself.   In  our  opinion,  there  was
nothing confidential in the matter, and hence reasons for not accepting  the
appellant’s version should have been stated in the order of the DA.”

      Para 43 has already been extracted earlier.
Looking at the contents of Rule 7 and  the  facts  and  issues  involved  in
Reliance Industries case, we agree with the submissions of  Mr.  Patil  that
fact situation in that case was entirely different and  the  Court  was  not
examining the provisions of Rule 7 in any detail but  made  rather  scathing
observations against the DA because the DA claimed  confidentiality  not  in
respect of any information  but  in  respect  of  its  findings  based  upon
information supplied by the same party who was aggrieved  by  non-supply  of
the  findings.   The  observations  in  Reliance  Industries  case  must  be
understood in the fact situation of that case in view  of  well  established
proposition of  law  that  the  ratio  decidendi  consists  in  the  reasons
formulated by the court for resolving an  issue  arising  for  determination
and not in what may logically  appear  to  flow  from  observations  on  non
issues. Reference in this regard may be  made  to  law  enunciated  on  this
point by a Constitution Bench, in paragraph 20 of the judgment in  the  case
of Krishena Kumar v. Union of India &  Ors.[7]   In  the  given  facts,  the
observations in paragraph 43 in the case of Reliance  Industries  are  fully
justified and do not require any review.  We are in agreement  that  Rule  7
does not postulate that the DA can claim confidentiality and  that  too  not
in respect of any information supplied by a party  but  in  respect  of  its
reasons or findings derived from  information  supplied  by  the  same  very
party.
We find no conflict between the view taken in Reliance Industries  case  and
that in Sterlite Industries, particularly in paragraph  3,  which  has  been
extracted in Reliance Industries case and reads as follows :
“3. In our view, it is not necessary for us to go into the  merits  of  this
matter as we propose to send the matter back  to  CEGAT  after  laying  down
certain guidelines. From what has been argued before us, it appears that  in
pursuance of Rule 7 of the Customs Tariff  (Identification,  Assessment  and
Collection of Anti-Dumping Duty on Dumped Articles and for Determination  of
Injury) Rules, 1995, the  Designated  Authority  is  treating  all  material
submitted to it as confidential merely on a party asking that it be  treated
confidential. In our view, that is not the purport of Rule 7. Under Rule  7,
the Designated Authority has to be satisfied as to  the  confidentiality  of
that  material.  Even  if  the  material  is  confidential  the   Designated
Authority has to ask the  parties  providing  information,  on  confidential
basis, to furnish a non-confidential summary thereof. If  such  a  statement
is not being furnished then that  party  should  submit  to  the  Designated
Authority a statement of reasons why summarization is not possible.  In  any
event, under Rule 7(3) the Designated Authority can come to  the  conclusion
that confidentiality  is  not  warranted  and  it  may,  in  certain  cases,
disregard that information. It must be remembered that not  making  relevant
material available to the other side affects the  other  side  as  they  get
handicapped in filing an effective appeal. Therefore, confidentiality  under
Rule 7 is not something which must be automatically assumed.  Of  course  in
such cases there is need for confidentiality as otherwise trade  competitors
would obtain confidential information, which they cannot otherwise get.  But
whether information supplied is required to be kept confidential has  to  be
considered on a case-to-case basis. It is for the  Designated  Authority  to
decide whether a particular material is required to  be  kept  confidential.
Even where confidentiality is required  it  will  always  be  open  for  the
Appellate Authority, namely, CEGAT to look into the relevant files.”

The concern shown by the Court in the above quoted paragraph as regards  the
ill-effect of being too liberal in accepting claims of  confidentiality  has
been echoed in the same vein in paragraph  45  of  the  Reliance  Industries
case in following words:
“45. In our opinion, excessive  and  unwarranted  claim  of  confidentiality
defeats  the  right  to  appeal.  In  the  absence  of  knowledge   of   the
consequences, grounds,  reasoning  and  methodology  by  which  the  DA  has
arrived at its decision and made its  recommendation,  the  parties  to  the
proceedings cannot effectively exercise their right to appeal either  before
the Tribunal or this Court. This is  contrary  to  the  view  taken  by  the
Constitution Bench of this Court in S.N. Mukherjee case.”

Mr. V. Lakshmikumaran appearing for some of the respondents such as  SanDisk
International Ltd. has highlighted particular facts of his  case.  According
to him anti-dumping investigation  was  initiated  against  SanDisk  on  the
petition of sole domestic producer Moser Baer India Limited against  imports
of USB Flash Drives exported from China PR, Taiwan  and  Republic  of  Korea
during the period of investigation, calendar year  2012.  According  to  him
SanDisk duly participated in the investigation, filed  objections,  comments
and submissions and co-operated at every stage  of  the  investigation.  His
main grievance is that when the reliability of  import  volume  provided  by
Moser Baer came under question, the DA claimed  to  have  used  transaction-
wise import data provided by Directorate General of Commercial  Intelligence
and Statistics (DGCI&S) for arriving at import volume of the subject  goods.
He has submitted that the DA wrongly treated the  import  data  provided  by
DGCI&S as confidential and in any case erred in not  accepting  the  request
of the SanDisk to furnish the  import  data  after  deleting  the  names  of
exporters/importers concerned, for verifying the veracity of the  volume  of
imports. According to him the essence of investigation lies in  finding  out
the correct import volume of a particular product under  investigation.  The
DA disregarded the past practice  of  disclosing  such  details,  especially
when SanDisk was prepared for deletion of names of exporters  and  importers
from the import data obtained by the DA.
Mr. V. Lakshmikumaran has in his written notes given two instances,  one  of
2007 and another of 2014 where the DA had disclosed the DGCI&S  import  data
to exporters and importers and had called for  comments.  According  to  him
DGCI&S had not claimed confidentiality in  such  matters  for  good  reasons
because the  concerned  Director  General  of  Commercial  Intelligence  and
Statistics under the Ministry of Commerce, Government of  India  is  covered
under Right to Information Act and its data is therefore  part  of  official
record and lies in public domain. According to him DA  is  a  quasi-judicial
authority who must keep in mind that Rule 7 is  an  exception  to  rules  of
natural justice and hence DA can accept  a  claim  of  confidentiality  only
when it is raised by the  information  provider  and  such  claim  is  found
acceptable after due scrutiny.
Since we are not entering  into  arena  of  facts  for  deciding  individual
cases, it is not relevant to go deeper into the facts highlighted on  behalf
of M/s SanDisk International Limited.  However,  the  submission  that  data
available with DGCI&S is available to the public and also under the RTI  Act
has not been rebutted in reply.
Mr. V. Lakshmikumaran has referred to  and  relied  upon  judgment  of  this
Court  in  Designated  Authority  (Anti-Dumping  Directorate),  Ministry  of
Commerce v. Haldor Topsoe A/S[8] to highlight that in the scheme of the  Act
and the Rules, in paragraph 25 of that judgment this  Court  considered  the
proviso to Rule 17 which empowers the Central Government to extend the  time
for publication of final finding  by  the  DA  by  further  six  months  and
repelled the submission that while granting extension of time,  the  Central
Government is obliged to  afford  opportunity  of  hearing  to  the  parties
concerned with the investigation. The Court  held  that  in  the  course  of
investigation  the  principles  of  natural  justice  would   have   limited
application only to the extent indicated in the statute,  because  elaborate
provisions for the same are already provided for. In our view this  judgment
helps the respondents only to a limited extent that  general  principles  of
natural justice need not be imported to govern each and  every  step  during
the investigation proceedings.
We are in respectful agreement  with  the  above  view  and  also  with  the
submission that the source of power in the DA to  treat  an  information  as
confidential must be within the confines of Rule 7. The ordinary meaning  of
the words used in this Rule are clear and hence there is no  requirement  to
depart from the golden rule of  interpretation  i.e,  the  rule  of  Literal
Construction. If the submission advanced on behalf of Union of India and  DA
are accepted, one will have to adopt a purposive liberal  interpretation  so
as to enlarge the scope of this  Rule.  That  does  not  appear  to  be  the
intention of the statute makers nor it is  warranted  by  the  context.  The
effect of Rule 7 is clear. It permits an  exception  to  the  principles  of
natural justice. In such a situation, even if there had been some  ambiguity
and requirement of resorting to interpretation, the proper course  would  be
to adopt a construction which would least offend our sense  of  justice,  as
discussed and enunciated in the cases of Simms v. Registrar of  Probates[9],
Madhav Rao Jivaji Rao Scindia v. Union of India[10] and Union  of  India  v.
B. S. Agarwal.[11] It will be useful to remember  that  when  two  competing
public interests are involved, like in the present case, one  is  to  supply
all relevant informations to the parties concerned  and  the  other  not  to
disclose informations which are held to be confidential, the  proper  course
of action would be to lean in favour of  the  construction  “that  is  least
restrictive  of  individual’s  rights”,  as  propounded  in  Inland  Revenue
Commissioner v. Rossminster Ltd.[12] . However,  in  our  view,  as  already
indicated, there are no ambiguities in Rule 7 to require departure from  the
rule of Literal Construction.
Mr. Lakshmikumaran also  referred  to  judgment  in  the  case  of  Reliance
Industries to point out that main issue in that case was decided  in  favour
of Reliance Industries in paragraphs 35, 36  &  37  holding  that  the  Non-
Injurious Price (NIP) had been determined wrongly and  therefore  needed  to
be revised by  taking  the  market  price  of  electricity  and  the  actual
capacity utilization during the  period  of  investigation.  Thereafter  the
Court simply condemned the approach of the DA in  not  disclosing  even  the
reasons for its erroneous decision to reduce the cost price  of  electricity
supplied by the appellant from its captive power plant. When  the  data  had
been supplied by the appellant itself, the Court rightly felt  disturbed  by
the act of DA in claiming confidentiality about its  findings.  In  view  of
proceedings being quasi-judicial, the DA was  rightly  held  duty  bound  to
disclose its reasons for not accepting the version given by  the  appellant.
Finally Mr. Lakshmikumaran submitted that  the  observations  given  by  the
Court in Reliance Industries case do not require any  interference  and  the
appeals filed on behalf  of  the  Union  of  India  and  the  DA  should  be
dismissed.
Mr. Jitendra Singh, advocate, appearing for Meghmani Organics  Ltd.  in  the
lead case, reiterated  the  submissions  noted  earlier.  According  to  his
submissions also there is no conflict between  law  laid  down  in  Sterlite
Industries case and in Reliance Industries case. He also submitted  that  in
fact the appeal against Meghmani Organics Ltd. has also become  infructuous.
However, we refrain to decide  the  matter  on  facts  even  to  the  extent
whether the appeal has become infructuous or not.
In the light of facts and submissions noted earlier as well  as  conclusions
already recorded at various places, we are of the considered view  that  the
question referred for our answer can be answered in a very straight  forward
manner by holding that Reliance Industries case did not go into the  details
of the relevant Rules including Rule 7 but the observations made therein  in
respect of rule of confidentiality as spelt out in Rule 7 of the Rules  does
not diminish the scope of Rule  7  as  provided.  The  reasons  or  findings
cannot be  equated  with  the  information  supplied  by  a  party  claiming
confidentiality in respect thereto. Hence, Rule 7 does not  empower  the  DA
to claim any confidentiality in respect of reasons  for  its  finding  given
against a party. The law laid down in respect of rule of confidentiality  in
Sterlite Industries case also has our respectful  concurrence.  But  at  the
same  time,  we  reiterate  that  the  Reliance  Industries  case  does  not
adversely affect or run counter to the law spelt out in Sterlite  Industries
case. We may only explain here that while dealing  with  objections  or  the
case of the concerned parties, the DA  must  not  disclose  the  information
which are already held by him to be confidential by duly  accepting  such  a
claim of any  of  the  parties  providing  the  information.   While  taking
precautions not to disclose the sensitive confidential informations, the  DA
can, by adopting a sensible approach indicate reasons  on  major  issues  so
that parties may in general terms have the knowledge as to  why  their  case
or objection has not been accepted in preference to a rival  claim.  But  in
the garb  of  unclaimed  confidentiality,  the  DA  cannot  shirk  from  its
responsibility to act fairly  in  its  quasi-judicial  role  and  refuse  to
indicate reasons for its findings. The DA will do well to  remember  not  to
treat any information as confidential unless a claim of confidentiality  has
been made by any of the parties supplying the information.  In  cases  where
it is not possible to accept a  claim  of  confidentiality,  Rule  7  hardly
leaves any option with the DA but to ignore  such  confidential  information
if it is of the view that the information is  really  not  confidential  and
still the concerned party does not agree to its being made public.  In  such
a situation the information cannot be made  public  but  has  to  be  simply
ignored and treated as non est.
Having answered the question thus, we direct the cases to be  posted  before
appropriate Bench for disposal on merits and in the light of our  answer  to
the question referred and considered.


…………………………………….J.
                       [J. CHELAMESWAR]


                       ……………………………………..J.
                             [SHIVA KIRTI SINGH]


                       ……………………………………..J.
                             [ABHAY MANOHAR SAPRE]

New Delhi.
October 7, 2016.


-----------------------
[1]
      [2] (2009) 2 SCC 510
[3]
      [4] (2006) 10 SCC 368
[5]
      [6] (2006) 4 SCC 303
[7]
      [8] (2006) 10 SCC 386 decided on November 25, 2003
[9]
      [10] (1990) 4 SCC 594
[11]
      [12] (2016) 1 SCC 91
[13]
      [14] (1990) 4 SCC 207
[15]
      [16] (2000) 6 SCC 626
[17]
      [18] (1900) AC 323
[19]
      [20] (1971) 1 SCC 85
[21]
      [22] (1997) 8 SCC 89
[23]
      [24] (1980) 1 All ER 80

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