Madras High Court Asks Customs to Clear Solar Modules Without Paying Safeguard Duty

The Madras High Court has dismissed the writ petition filed by domestic project developer Shapoorji & Pallonji against the levy of 70 percent safeguard duty for 200 days as prescribed by the office of Directorate General (DG) Safeguards.

It is a significant development as the court’s move will now pave the way for the levy of safeguard duty on solar imports from China, Malaysia, Singapore, and Taiwan.

An official at the Madras High Court confirmed the dismissal of the writ petition to Mercom saying, “The writ petition number 1156 filed by Shapoorji & Pallonji against Union of India has been dismissed today”.

A source at Indian Solar Manufacturers Association (ISMA) told Mercom, “Yes, the petition has been dismissed. Now, the Office of DG Safeguards can work towards the implementation of levy of 70 percent safeguard duty for the initial period of 200 days.”

When contacted, an official at the office of DG Safeguards said, “Yes, we know that the petition has been dismissed. Now as a next step, we (DG Safeguard Office) will send a report or communicate with the Ministry of Commerce that this petition has been dismissed. Then it is up to the Ministry of Commerce to levy or not to levy the duty of 70 percent for 200 days that was recommended in the preliminary finding.”

The official further said, “Up till now, we had stalled any further investigation. After this Madras High Court order, we will finish our investigation.”

When asked about the approximate time required for the investigation to be over, the official said, “By August 18, 2018, DG Safeguard will submit its final report. After that it’s up to the Ministry.”

Quick Recap of the Case

In a preliminary finding issued in January 2018, the Directorate General of Safeguards Customs and Central Excise had recommended a 70 percent safeguard duty be imposed on solar cells imported from China and Malaysia for a period of 200 days.

The recommendation came after the ISMA filed a petition with the Directorate General of Safeguards Customs and Central Excise in December 2017, that sought the imposition of a safeguard duty on imported solar cells from China, Malaysia, Singapore, and Taiwan.

On January 22, 2018, the Madras High Court put a temporary stay on the recommendation to levy a 70 percent safeguard duty on solar components imported to India. The court arrived at the decision after listening to a petition filed by project developer Shapoorji Pallonji that requested that the court intervene in the matter.

In March 2018, after the conclusion of the oral hearing, the Madras High Court had asked Shapoorji Pallonji and the Office of the Director General (DG) of Safeguards to submit the written statements on the ongoing safeguard duty case.

Image credit: By Yoga Balaji (File:Chennai High Court.jpg) [CC BY-SA 3.0], via Wikimedia Commons