DGTR to Hold Public Hearing on Safeguard Duty Investigation on June 26, 2018

Just a few days after the Supreme Court put aside the stay order on safeguard duty by the Orissa High Court, the Ministry of Finance has now issued an instruction asking the custom authorities to finalize all the provisional assessment and collect safeguard duty as per its earlier notification dated July 30, 2018.

According to the  notification, the government had levied 25 percent safeguard duty on solar modules and cells imported from China and Malaysia. The new Supreme Court order had made it amply clear that this safeguard duty will be levied effective July 30, 2018.

The government has also withdrawn its earlier notification which asked custom officials to not insist on the payment of safeguard duty on solar imports but make provisional assessments of duty.

According to the Ministry of Finance, the duty will be levied as follows:

  • 25 percent ad valorem (according to value in proportion) minus anti-dumping duty payable, if any, when imported during the period from July 30, 2018 to July 29, 2019 (both days inclusive).
  • 20 percent ad valorem minus anti-dumping duty payable, if any, when imported during the period from July 30, 2019 to January 30, 2020 (both days inclusive).
  • 15 percent ad valorem minus anti-dumping duty payable, if any, when imported during the period from January 30, 2020 to July 29, 2020 (both days inclusive).

Background

Recently, the Ministry of Finance announced the levy of a 25 percent safeguard duty based on the final recommendations proposed by the DGTR. The duty took effect on July 30, 2018.

The ministry levied the duty despite an Orissa High Court order that put a stay on the implementation of the safeguard duty on solar modules and cells. ACME Solar had filed a petition after the DGTR recommendations and received the stay order from the court. The court had then directed the government not to issue any notification regarding the safeguard duty until August 20, 2018

However, after the sudden imposition of the duty, Hero Future Energies, ACME Solar and Vikram Solar filed new petitions in the Orissa High Court opposing it.

Then, the Orissa High Court heard the petition filed by Hero Future Energies, ACME, and Vikram Solar against the Directorate General of Trade Remedies (DGTR). Noting that the safeguard duty notification was issued by the ministry despite the court’s stay order on any further notifications until August 20, the bench had directed it to withdraw the notification for now.

Following the Orissa High Court order to stay the notification on the safeguard duty, the Madras High Court had then instructed customs officials at the Chennai port to provisionally release the module shipments without paying the safeguard duty. However, the court had asked customs authorities to make a provisional assessment of the safeguard duty payable in the event of upholding the notification and company to furnish a bond. The Madras High Court was responding to a petition filed by Shapoorji Pallonji to clear its goods without requiring the company to pay the safeguard duty.

Nitin is a staff reporter at Mercomindia.com and writes on renewable energy and related sectors. Prior to Mercom, Nitin has worked for CNN IBN, India News, Agricultural Spectrum and Bureaucracy Today. He received his bachelor’s degree in Journalism & Communication from Manipal Institute of Communication at Manipal University and Master’s degree in International Relations from Jindal School of International Affairs. More articles from Nitin Kabeer