Hero Future, Vikram Solar and ACME go to Court Against DGTR Opposing Safeguard Duty

Recently, the government imposed 25% safeguard duty on solar imports from China and Malaysia


New petitions have been filed in the Orissa High Court against the imposition of safeguard duty by the Ministry of Finance recently.

The government imposed the safeguard duty even though the Orissa High Court had put a stay on any further activities or decisions to be taken in the case. Last week, ACME Solar, had received a stay order for the imposition of safeguard duty. The court had then directed the government not to issue any notification regarding Safeguard Duty until August 20, 2018

Now, after the imposition of the duty, court filings show that Hero Future Energies, ACME Solar and Vikram Solar have filed petitions against Director General (Safeguards) DG of Trade Remedies in the same high court.

Speaking to Mercom, Sunil Jain, the CEO Hero Future Energies, said, “The DG Safeguard has not taken cognizance of developers’ views and has exceeded his brief. We are not clear if this announcement is also a contempt of court, as the Orissa High Court had put a stay in place up to August 20, 2018. Now that the duty is being levied, our plea is to make the exercise of pass-through option seamless and practical. The process should be easy so that the capital does not get stuck in a loop of government departments and departmental procedures. Projects that have been already bid out will be affected by this sudden imposition of safeguard duty. Most developers wouldn’t have factored in the added costs which may easily lead to NPAs. This is the plea we have made in the court against the safeguard duty imposition notification.”

Vikram Solar Limited has also filed a Writ Petition in Orissa High Court seeking the relief stating the following:

  • Suitable exemption/clarification for SEZs (Special Economic Zones) from duties of safeguard, which will put SEZs at par with manufacturing units located in domestic tariff area (DTA).
  • Considering SEZ units as a part of domestic industry (DI) for the purpose of safeguard investigation.
  • EPC contracts which are already awarded should be kept out of the ambit of safeguard duty

“Imposition of duties of safeguard without the relief and clarification listed above will not serve its desired purpose, which is to boost the domestic manufacturing industry,” the company stated in an emailed response to Mercom.

The safeguard duty is currently applicable to companies in SEZ affecting a majority of the domestic solar manufacturing capacity.

The government has not clarified so far as to how the safeguard duty was imposed despite the Orissa court stay order.