Principles of Natural Justice: An Inherent Aspect of Trade Remedial Investigations

Author: Ojasvi Nautiyal, Legal Associate

The principles of natural justice are a vital element of all justice delivery systems across the globe. The phrase natural justice literally translates to law of nature and implies that justice must be fair, reasonable, equal and must protect rights of individual against any arbitrary exercise of power by the State or its functionaries, including judiciary, and to prevent miscarriage of justice. While the concept of natural justice is not expressly codified under any statute or law, it is indispensable in any decision-making process that adversely impacts the substantive rights of individuals.

While the principles of natural justice are not codified, the concept has been evolved by the courts over time. Initially, the concept of natural justice was restricted to only judicial proceedings and decisions rendered by courts were required to adhere to such principles. Later, with the increasing role of administrative authorities in decision-making, administrative decisions taken by authorities were also required to comply with principles of natural justice. In addition, there exist certain administrative authorities which exercise adjudicatory functions, which include determination of facts and drawing conclusions therefrom which form the basis of an official action. Such authorities, known as ‘Quasi-Judicial’ authorities, are also required to follow principles of natural justice while making decisions.

Investigating authorities under different jurisdictions conducting trade remedial investigations are essentially quasi-judicial bodies performing quasi-judicial functions and thus, must follow principles of natural justice. This was affirmed by the Hon’ble Supreme Court in the case of Automotive Tyre Manufacturer’s Association (ATMA) vs. Designated Authority wherein it was held that the functions performed by the Directorate General of Trade Remedies (DGTR), or Designated Authority, under the statute are quasi-judicial functions, and as a consequence, “the duty to follow the principles of natural justice is implicit in the exercise of power conferred on him [Designated Authority] under the said Rules”. Thus, trade remedial investigations conducted by the DGTR are required to comply with the principles of natural justice.

The concept of natural justice broadly comprises of two principles – Nemo judex in causa sua (rule against bias) and Audi alteram partem (rule of fair hearing). The first principle of natural justice provides that no person shall be judge in their own cause, in order to ensure there is no personal or pecuniary or official bias in the decision-making process. Decisions made in violation of the principle are null and void. For instance, if there is any evidence of bias in a finding, order or decision, such a finding, order or decision may be set aside by courts.

The second principle of natural justice, rule of fair hearing, is an umbrella term which encompasses a number of rules, which ensure that no one should be condemned unheard. The procedure followed by a quasi-judicial body must safeguard the right of each individual to defend themselves by allowing them a fair opportunity. The procedure laid down for conducting trade remedial investigations in India under the Customs Tariff Act, 1975 and rules made thereunder strictly comply with the rule of fair hearing, as can be seen below.

  • Right to Notice

The decision-making authority is required to give a valid and proper notice to the required parties before proceeding with any action against such parties. Rules 6 of the Anti-Dumping Rules provide that the Designated Authority shall issue public notice containing adequate information concerning the investigation. Further, such notice must be forwarded to all known exporters of the product, the Governments of the exporting countries and any other interested parties. Additionally, the Designated Authority as practice also notifies all interested parties with regards any oral hearing conducted. The Designated Authority shall issue a public notice recording its final findings, under Rule 17(4) of the Anti-Dumping Rules respectively. Before arriving at the final findings, the Designated Authority also notifies the essential facts under consideration forming basis of its decision, to all injury period, under Rule 16.

  • Right to present and know evidence

All parties to a proceeding have a right to present evidence to defend their case and also have the right to know or receive evidence that will be used against while making a decision. At the stage of initiation itself, the Authority shall furnish a non-confidential copy of the application filed by or on behalf of the domestic industry, under Rule 6(2). Under Rule 6(5) of the Anti-dumping Rules the DGTR can call for information from all interested parties which may allow them to draw conclusions. Further, under Rules 6(3) and 6(7), the DGTR shall share evidence or information with all interested parties, including that filed by the domestic industry, governments of subject countries, exporters, importers, users, and associations representing them.

  • Right to be heard

A reasonable opportunity of being heard must be given to parties participating in a proceeding. Such opportunity of hearing may be oral or in the form of written information. Rule 6(6) of the Anti-Dumping Rules provide that the Designated Authority may allow any interested party or their representative any opportunity to present information orally. It is interesting to note that while the Anti-Dumping Rules provide that the Authority “may” allow parties to present information orally; in India, such a hearing is required to be mandatorily provided in following principles of natural justice.

In fact, the Hon’ble Supreme Court in the case of ATMA vs. Designated Authority has even taken a view that it is necessary that the decision-making authority, which hears the interested parties, must decide. This implies that when there is a change in the incumbent Designated Authority, and the oral hearing has already been conducted before the earlier Authority, the Authority that is passing the finding must give a fresh hearing to all parties before taking a final decision. As a result, in some cases, such as the anti-dumping investigation concerning flat rolled products of stainless steel, there were three hearings,

  • Reasoned decision

Lastly, the Designated Authority is required to give a reasoned order. The findings issued by the Designated Authority shall contain detailed reasoning with regard to its conclusions on dumping, injury and causal link, and its recommendations based on the same.

Similar rules, ensuring compliance of principles of natural justice, are contained in Countervailing Duty Rules, Safeguard Duty Rules and Quantitative Restrictions Rules as well.

The principles of natural justice, while not enshrined under any law expressly, have been sufficiently incorporated under the Rules applicable to various trade remedial investigations. By virtue of such incorporation, the investigation process ensures that all parties involved are given equal and fair opportunity to present and defend their case, before a definitive conclusion is reached by the Authority, thus fulfilling the purpose of justice. After all, it has long been accepted that “justice should not only be done, but should manifestly and undoubtedly be seen to be done”.