Page 1 C.A.No. 1679 of 2010 etc.

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.

1.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,

1

(2009) 2 SCC 510

1

Page 2 C.A.No. 1679 of 2010 etc.

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.”

2.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

2

(2006) 10 SCC 368

3

(2006) 4 SCC 303

2

Page 3 C.A.No. 1679 of 2010 etc.

of by competent Benches in the light of our answer to the aforesaid

question/issue of law.

3.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

4

(2006) 10 SCC 386 decided on November 25, 2003

5

(1990) 4 SCC 594

3

Page 4 C.A.No. 1679 of 2010 etc.

4.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.

5.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

4

Page 5 C.A.No. 1679 of 2010 etc.

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).

6.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

5

Page 6 C.A.No. 1679 of 2010 etc.

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

Page 7 C.A.No. 1679 of 2010 etc.

6.3 XXXXXXXXXXXX

6.4The 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.

6.5Any 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

7

Page 8 C.A.No. 1679 of 2010 etc.

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.

7.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

8

Page 9 C.A.No. 1679 of 2010 etc.

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

9

Page 10 C.A.No. 1679 of 2010 etc.

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.”

8.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

10

Page 11 C.A.No. 1679 of 2010 etc.

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.

9.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.”

10.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

11

Page 12 C.A.No. 1679 of 2010 etc.

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.

11.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

(2016) 1 SCC 91

12

Page 13 C.A.No. 1679 of 2010 etc.

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

13

Page 14 C.A.No. 1679 of 2010 etc.

of a party for the purpose of Rule 7 and to claim as well as accept on

information to be confidential.

12.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

14

Page 15 C.A.No. 1679 of 2010 etc.

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.

13.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.

14.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

15

Page 16 C.A.No. 1679 of 2010 etc.

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.

15. 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

16

Page 17 C.A.No. 1679 of 2010 etc.

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.

16. We find no conflict between the view taken in Reliance

Industries case and that in Sterlite Industries, particularly in

7

(1990) 4 SCC 207

17

Page 18 C.A.No. 1679 of 2010 etc.

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.”

17. The concern shown by the Court in the above quoted

paragraph as regards the ill-effect of being too liberal in accepting

18

Page 19 C.A.No. 1679 of 2010 etc.

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.”

18. 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

19

Page 20 C.A.No. 1679 of 2010 etc.

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.

19. 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.

20. 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,

20

Page 21 C.A.No. 1679 of 2010 etc.

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.

21. 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.

22. 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

8

(2000) 6 SCC 626

21

Page 22 C.A.No. 1679 of 2010 etc.

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.

9

(1900) AC 323

10

(1971) 1 SCC 85

11

(1997) 8 SCC 89

22

Page 23 C.A.No. 1679 of 2010 etc.

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.

23. 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.

12

(1980) 1 All ER 80

23

Page 24 C.A.No. 1679 of 2010 etc.

24. 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.

25. 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

24

Page 25 C.A.No. 1679 of 2010 etc.

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.

25

Page 26 C.A.No. 1679 of 2010 etc.

26. 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.

26