SME Chatroom: Anti-dumping duty can be levied with retrospective effect

Q1. The government has initiated anti-dumping investigations on one of our key inputs. Can any action taken affect the imports already made? Can the government impose anti-dumping duty (ADD) retrospectively? What are the actual legal provisions?

Section 9(3) of the Customs Tariff Act, 1975 empowers the government to, through a notification, levy anti-dumping duty retrospectively from a date prior to the date of imposition of anti-dumping duty, but not beyond 90 days from the date of the notification. This applies to notifications based on provisional findings of the Designated Authority, i.e. the Director General of Trade Remedies (DGTR) also. However, as per the first proviso to Rule 20(2) of the Customs Tariff (Identification, Assessment and Collection of Anti-dumping Duty on Dumped Articles and for Determination of Injury) Rules, 1995, no duty can be levied retrospectively on imports entered for home consumption before initiation of the investigation.

However, any retrospective levy of anti-dumping duty should be based on the recommendations of the DGTR on whether a retrospective levy is called for and, if so, the reasons for it and date of commencement of such retrospective levy, as mentioned at Rule 17(1)(4) of the said Rules. Thus, a retrospective levy can be from the date of initiation of the anti-dumping investigation, or 90 days prior to the date of the notification levying the anti-dumping duty, whichever is later.

Q2. The government has now exempted the GST on the fee for getting an alcoholic liquor licence retrospectively, from July 1, 2017, to September 30, 2019. Can we get a refund of GST on the licence fee that we paid during that period?

Please note that “service by way of grant of alcoholic liquor licence, against consideration in the form of licence fee or application fee or by whatever name it is called” was notified on September 30, 2019, as neither a supply of goods nor a supply of service under the CGST/SGST/IGST/UTGST laws. Now, clauses 117, 120 and 123 of the Finance Bill 2022 propose to give retrospective effect to the notifications issued under the CGST/IGST/UTGST laws with effect from July 1, 2017. Sub-clause (2) of the same clauses says that no refund of the tax collected during the relevant period will be granted.

Q3. Some of our customers abroad want us to mention in the bill of lading a HS Code different from what we use. How to proceed?

Our tariff is aligned at the six-digit level with the World Customs Organisations HSN. Most countries have aligned their tariffs at the six-digit level. So, if there is a difference at the 8-digit level between the HS Codes of the importing and exporting country, there is no issue. Otherwise, you both have to review whether your classifications are correct. If the customer still insists on a HS Code different at the six-digit or lower levels, you may mention your HS Code in the BL and “HS Code in the importing country as advised by the importer…”
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