TaxTMI 
TaxTMI 
2014 (1) TMI 383
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....on No. 14/04/2006-DGAD dated 28.01.2008 recommending the said levy equal to the lesser of margin of dumping and margin of injury are under challenge in this appeal by the exporter appellant M/s Sasol Solvents from South Africa. 2. The period of investigation (POI) relating to dumping involved in this appeal was 1st July 2005 to 30th June 2006 and injury investigation covered the period April 2003-March 2004, April 2004-March 2005 and April 2005- March 2006 and the POI. Recommendation for the levy aforesaid was made by DA drawing following conclusions: (a) That the subject goods were exported to India from the subject countries below its normal value; (b) The domestic industry has suffered material injury; and (c) The injury was caused by the dumped imports from subject countries; 3. During currency of levy of definitive antidumping duty by the customs notification aforesaid, sunset review has also been initiated. 4.1. Hindustan Organic Chemicals Ltd. Mumbai and M/s Schenectady Herdiallia Ltd. Mumbai (Renamed as SI Group Ltd.) constituting domestic industry, producing 100% of total production of Acetone in India, made an application dated 27.02.2006 to the Designat....
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....imports of subject goods from South Korea. However, investigation against Russian Exports was terminated by a Notification dated 14.03.2008. 4.5. Following due process of law, the DA, carried out preliminary investigation against exports from subject countries. On the basis of evidence came to its record, the authority found that there was price under cutting and price under selling. Therefore as an interim measure, the authority recommended imposition of provisional antidumping duty in terms of preliminary finding notified on 25/04/2007 as amended by Notification dated 25.05.2007. While recommending the levy of provisional antidumping duty, the DA also indicated the procedure to be followed for detailed investigation subsequently. Based on the preliminary findings, provisional antidumping duty was levied by the Ministry of Finance by Customs Notification No. 77/2007-Cus dated 19/06/2007. 5. Subsequent to levy of provisional antidumping duty, detailed investigation was carried out by the DA. He considered the data/information of the following exporters from the subject countries to determine the dumping and dumping margin as well as to make injury analysis and noted submissio....
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....ucer. But the DA opined that the real purpose of levy of anti-dumping duty shall be defeated if that concern is excluded from the constitution of domestic industry when imported acetone by SI group were not available for sale in domestic market. 9. Similarly HOCL which was also a complainant domestic producer was a BIFR company being sick and there was complete erosion of funds due to accumulated losses suffered. But the DA considered it proper not to disqualify that company to constitute domestic industry and seek relief under Anti-dumping law. That Authority allowed HOCL to constitute domestic industry for the reason that it shall further sustain injury due to import of subject goods if deprived of the benefit of the trade remedy measure. The objection of appellant to exclude that company from purview of domestic industry did not get appreciation by DA. Both the producers constituted domestic industry. DETERMINATION OF NORMAL VALUE, EXPORT PRICE AND DUMPING MARGIN BY DA 10.1. No exporters of USA and EU responded to the initiation Notification. The DA taking the average price reported in ICIS LOR (US Gulf) and ICIS LOR (EUROPE) for the POI determined normal value of expor....
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.... final findings taking into account transaction wise details provided by M/s Formosa Chemicals & Fibre Corporation (FCFC) and M/s Taiwan Chemical Corporation (TPCC). Disregarding sales made by (FCFC) to affiliated parties not made in the ordinary course of business, the DA adopted the sale made to non-affiliated parties and determined normal value of exports of bulk and packed goods from Chinese Taipei making adjustment of various expenses on weighted average basis. 11.1. The ex-factory export price of bulk exports from USA was determined taking data from DGCI&S data bank, allowing necessary adjustments since the exporters from USA were non-cooperating exporters. Similarly the exporters from EU being non-cooperating exporters, the export price of bulk goods from that country was determined in the same manner as that was determined for USA. 11.2. Mitsui & Co. Ltd. of Singapore having provided transactions wise information relating to exports, those data were verified and making permissible adjustments towards certain expenses, Ex-factory price of bulk goods was determined accordingly. Sumitomo Corporation of Singapore having raised invoices on M/s Petrochem Middle East, UAE, t....
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.... 52.52% M/s Sumitomo Corporation and M/s Petrochem Middle East, UAE *** *** *** *** *** *** *** *** 47.84% Non-cooperating Exporters *** *** *** *** *** *** *** *** 65.38% South Africa M/s Sasol Solvents *** *** *** *** *** *** *** 24.50% 24.50% Non-cooperating Exporters *** *** *** *** *** *** *** *** 35.68% Chinese Taipei M/s Formosa Chemicals *** *** *** *** *** *** *** *** 14.43% M/s Taiwan Prosperity *** *** *** *** *** *** *** *** 13.84% Non-cooperating exporters *** *** *** *** *** *** *** 38.78% USA Non-cooperating exp....
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....anti-dumping investigations against these countries have also been initiated. 72. The demand (excluding captive consumption) of subject goods shows similar trend. It grew by 53% during POI as compared to the base year. The trend indicates that the share of domestic industry which was at 63.02% in 2003-04 declined to 37.02% during POI. During the same period the share of subject countries which was 33.10% in 2003-04 rose to 62.20% in 2004-05 and 55.22% during POI.[Emphasis supplied] 13.3. Price underselling and price undercutting was examined by Designated Authority in Para 74 in respect of the import of subject goods from subject countries as tabulated below: Unit 2003-04 2004-05 2005-06 July'05 to June'06 Selling price-DI Rs/MT Trend Indexed 100 131 119 113 Customs Duty % 25 20 14.79 14.17 Landed Value USA Rs/MT 32723 48653 38394 37553 Price Undercutting Rs/MT *** *** *** *** Price Undercutting % *** *** *** &n....
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....ubject goods in or exported from South Korea. Such approach of investigation has resulted in failure of determination of dumping and injury correctly. Therefore Designated Authority should have followed a consistent practice for simultaneous investigation in respect of subject goods exported from subject countries as well as South Korea and Russia. DA made a wrong approach for which final finding of DA is liable to be set aside. 14.3. It was also submitted by the appellant that M/s Hindustan Organic Chemicals Ltd. (HOCL) being a BIFR company which had already accumulated losses for its own inefficiency of performance, neither had right to complain nor could be considered as producer of domestic industry. 14.4. Appellant further submitted that while antidumping investigation related to Acetone, Phenol was excluded from the purview of subject goods in the investigation which was unwarranted. When SI Group was importing Phenol there was no need to exclude the Phenol from the purview of investigation since that importer was considered by DA as producer of the domestic industry. 14.5. It was further argued on behalf of appellant that the constitution of the domestic industry wa....
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.... deficiency in the application of domestic industry. He should have followed the law laid down by Apex Court in the case of Commissioner of Police Bombay vs. Gordhandas Bhaiji in AIR-1952-SC-16: MANU/SC/2/1951 holding that Public Authority should act publicly and particularly reading Para 14 of the said judgment the appellant submitted that the designated authority failed in his duty to disclose the relevant information. Accordingly, for lack of discloser by DA, his findings are unsustainable. 14.10. It was also submitted by Appellant that the finding of the designated authority was ab initio void due to exclusion of South Korea and Russia from the purview of investigation. In this regard, Article-5 of the WTO Agreement was relied upon to submit that an application for investigation should contain certain particulars. When that was lacking, there should not have been any investigation. The designated authority initiated investigation against exports from South Korea differently which has caused prejudice to the appellant. Reliance was placed on Para 323 of page 381 of the Panel report in Guatimala case in this regard. 14.11. On the above grounds it was prayed by appellant tha....
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....d imports. ARGUMENTS ON BEHALF OF DOMESTIC INDUSTRY 16.1. On behalf of Domestic Industry it was argued that the appellant being an exporter failed to show that there was neither dumping nor any injury caused to domestic industry by its exports. There is no ground in the grounds of appeal of the appellant in appeal memo in this regard. 16.2. There was a proper determination of dumping, dumping margin and injury made by the DA. Relying on Para 46 of the appeal paper book, appearing at page 79 thereof, it was submission of domestic industry that dumping margin in respect of exports from subject countries were significant and most particularly export of appellant from South Africa, was 24.50% of the export value. Similarly, magnitude of injury margin is recorded by DA in Para 102 at page 93 of the appeal folder. Therefore, DA has rightly recommended anti dumping duty and that was rightly acted upon by Customs Notification dated 11.3.2008. 16.3. Both the requirements of the levy i.e. dumping and injury followed by causal link being satisfied, domestic Industry had right to complain for protection by the levy. The appeal is, therefore, liable to be dismissed. 16.4. The DA ....
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.... contrary. 16.8. Law permitted the DA under Rule 14 of 1995 Rules to terminate investigation against Russian exporters. There is no justification by the appellant to submit that by not including South Korea and Russia the recommendations in the final findings are vitiated. Since investigation against South Korea was initiated separately when accurate data and information was provided, the appellant exporter has no right to seek relief on the ground of separate initiations. 16.9. The appellant did not challenge determination of normal value or export price. When complete data of one year was available for the POI, investigation for the said period against the export of subject goods from subject countries was rightly done. There was nothing wrong to initiate anti dumping investigation in existence of dumping and injury. The DA was justified to initiate investigation properly against exports from subject countries considering the de minimus criteria and to initiate separate investigation against exports of South Korea by a subsequent initiation Notification which is not denied by law. 16.10. Proper consideration of injury Parameters having been made while conducting investig....
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....erusal of the interested parties. Without specifying which information was denied, the appellant makes vague plea without any rhyme or reason. Therefore, appeal should be dismissed. 16.14. Alternatively, it was submitted by the domestic industry that if at all Tribunal decides to include South Korea export figures in the calculation of dumping margin and injury margin for injury analysis with the export of subject goods from subject countries, in a remand following decision of Tribunal in the case of Allied Enterprises Vs. Designated Authority - 2011 (272) ELT 127 (Tri.-Del) and BASF South East Asia Pte. Ltd. Vs. DA - 2010 (253) ELT 554 (Tri.-Del), no benefit shall accrue to the appellant since the rate of duty shall not vary nor dumping margin change. So also injury margin remains unaltered. Therefore, the Designated Authority should not be burdened with an academic exercise by remand when it is a proven case of existence of dumping and injury as well as causal link between the dumping and injury. It was also submitted that when non-injurious price (NIP) was determined rightly on the basis of figures of domestic industry, that shall not change in any circumstances or by any mea....
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....country was excluded from the purview of initiation notification dated 07/09/2006. Correspondences were made with domestic industry to provide data relating to 12 months period in respect of import from subject countries. But the domestic industry having expressed difficulties to gather such data, initiation notification above was issued with the expectation that the domestic industry would update the information during progress of investigation. The DA acted bonafide and issued initiation notification to protect the domestic industry against dumped imports from subject countries. Therefore action of DA is not faulty and not liable to criticism. 17.2 HOCL and SI Group being the two producers of domestic industry producing 100% of the domestic production of subject goods, their locus standi cannot be challenged when dumping and injury was demonstrated by them for their protection by anti dumping levy. Evidence furnished by them being found adequate and their information accurate, trade remedy measure cannot be denied to them. 17.3. It was further submitted on behalf of the DA that following the mandate of Rule 5 of the 1995 Rules, investigation having been initiated and done s....
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....efore their complaint was valid and their pleas tenable to initiate investigation. Appeal should therefore be dismissed. 17.8. Ld. Counsel for the designated authority relying on Para 69 of the final findings submitted that there was no legal infirmity in the findings recorded by the DA since dumping margin and injury was determined taking the normal value and export price properly and also cost data of domestic industry considered. Therefore DAs finding being based on evidence and is not liable to be set aside when dumping and injury was patent. Material injury to domestic industry by dumped imports was found by DA. Considering volume effect, in Para 65 of the finding and also various relevant parameters of injury being examined as is apparent from Para 66 to Para 102 of the final findings, recommendation for levy was proper. Magnitude of injury margin was found to be substantial as has been recorded in Para 102 of final finding to recommend appropriate dose of duty Therefore, final findings of DA are unassailable. Similarly Customs Notification having based on sound logic and basis is not liable to be set aside. 17.9. Appellants challenge that there was no cumulation of i....
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....tiated investigation on 7.9.206 against subject countries although the application for initiation of investigation was against US, EU, Singapore, Chinese Taipei and South Africa as well as South Korea. The Authority considered that the data provided by the domestic industry was for a period of nine months and that was inadequate to investigate into various aspects of the exports as per standard practice since POI normally comprises a period of twelve months. But he found that the exports from US, EU, Singapore, Chinese Taipei and South Africa were above de minimus level, while exports from South Korea was below such level since its exports were 2.7% while 3% is minimum requirement for initiation of investigation. Accordingly investigation against export from South Korea was postponed on the ground of de-minimis level of export. Records of DA demonstrate these facts. Hon'ble High Court of Calcutta in the case of State of Gujarat Fertilisers & Chem. Ltd V. Addl. Secy. & Designated Authority - 2012 (286) ELT 348 (Cal) held that it is incumbent for the Court to see what could be real and rational object for employing the definition of 'domestic' industry and this could be gathered upon....
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....fence purposes. We record the learned Trial Judge did not decide with examination of object clause of Memorandum of Association. We think this exercise is paramount and without the same the appellant could not be held to be importer in the sense as it is intended by the said Rule. [Emphasis supplied] 20. Simultaneous investigation into the exports of all countries covered by initiation Notification dated 7.9.2006 was done. The DA acted in accordance with law expecting that in the mean time domestic industry would update statistics relating to the export of subject country for the period of investigation covering July, 05 to June, 06. That was in fact done in the course of investigation and final findings based on such statistics and injury analysis was also made accordingly for the period as stated at the very outset of this order. The authority issued separate Notification dated 12.2.2007 for initiation of investigation into export from South Korea and Russia against application of domestic industry for that purpose, received in November, 2006. At that time, South Korean exports were above de minimus level. However, DA faced non cooperation of South Korea exporters as result o....
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....eads as under: In light of the findings above, we conclude that Guatemala's initiation of an investigation, the conduct of the investigation and imposition of a definitive measure on imports of grey Portland cement from Mexico's Cruz Azul is inconsistent with the requirements in the AD Agreement in that: (a) Guatemala's determination that there was sufficient evidence of dumping and threat of injury to initiate an investigation, is inconsistent with Article 5.3 of the AD Agreement (b) Guatemalas determination that there was sufficient evidence of dumping and threat of injury to initiate an investigation and consequent failure to reject the application for anti-dumping duties by Cementos Progreso is inconsistent with Article 5.8 of the AD Agreement. (c) Guatemala's failure to timely notify Mexico under Article 5.5 of the AD Agreement is inconsistent with that provision. (d) Guatemalas failure to meet the requirements for a public notice of the initiation of an investigation is inconsistent with Article 12.1.1 of the AD Agreement. (e) Guatemala's failure to timely provide the full text of the application to Mexico and Cruz Azul is inconsistent with Article 6.1.3 o....
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....egularities of aforesaid nature. Such defects not being present in the present appeal it cannot be said that DA followed inconsistent practice when export from South Korea was below de minimus level for initiation of investigation by a common Notification dated 07/09/2006. 23. DA examined relevant data provided by the applicants as to whether they constitute domestic industry in terms of Rule 2 (b) of 1995 Rules. It was found that they were the only producers of subject goods domestically. He applied above rule to hold that they constitute domestic industry. This status of applicants remained uncontroverted by the appellant. The Authority was aware that HOCL was a sick company and contingent loss was incurred by that company. But to recover from sickness that company deserved trade remedy measure. Similarly, he was also aware that 83% of import of subject goods by SI Group under advance license was meant for use in final goods manufactured for export thereof without sales of such subject goods domestically. The DA therefore rightly considered their complaint to redress in accordance with law providing them protection of trade remedy measure. That cannot be said to be faulty and ....
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....ly. It made every information public on public record and entire information was available in public domain. Therefore, appellant's plea that it was deprived of information is inconceivable. 26. Hon'ble Rajasthan High Court in the case of Rajasthan Textile Mills Association vs. Director General of Anti Dumping Duty -2002 (149) ELT 45 (Raj.)has given guide line about confidential nature of information in following language: The petitioners have also half heartedly challenged the validity of sub-rule (7) of Rule 6, which pertains to confidentiality of the information. The rule provides that any information provided to the Designated Authority on a confidential basis by any party shall not be disclosed to any other party without specific authorisation of the party providing the information, if the Designated Authority is satisfied that it is confidential. Any information, which is by nature confidential, for instance the information the disclosure of which would be significant competitive advantage to a competitor or because its disclosure would have a significant adverse effect upon a person supplying the information or upon a person from whom the person acquires the informatio....
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.... final finding unerringly. All these statistical and material facts remain uncontroverted by the appellant, in absence of any cogent and credible evidence to the contrary, to disturb the final findings and Notifications prescribing levy of anti dumping duty required to set off injury. The Appellant itself proved that its exports resulted in dumping with the dumping margin to the extent of 24.5% of the export value. So also exports of non-cooperating exporters proved their exports resulting in 35.68% dumping margin. Appellants plea for exclusion of South Korean exports has disturbed dumping margin calculation and injury analysis, is baseless and de-merited. It is surprising how dumping margin calculation shall vary if South Korea exports are included with the export of subject countries when the DA has calculated independent margins in respect of each export from each country which is the basis of law in the final finding under respective Notifications. Dumping margin in respect of South Korean exports was calculated in the respective Notification recommending levy of anti dumping duty in respect of its exports taking normal value of subject goods in South Korea and export price of....
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....ion to exclude those two producers from being included in domestic industry. We may say that in the case of State of Gujarat Fertilizers & Chem. Ltd. vs. Add. Secy. & Designated Authority -2012 (286) ELT 348 (Cal), Hon'ble High Court Calcutta elucidated meaning of domestic industry in Para 13 & 14 of the said judgement holding that the realistic and logic meaning of import is to be understood to determine who is importer. In the present case it is clear finding by D.A. that SI group was not a trader but importing the subject goods under advance license was for use in manufacture of final goods meant for export. Therefore, appellant misplaced on the decision of Thai Acrylic (supra). 33. Domestic industry can only be protected by trade remedy measure irrespective of its status of profit or loss making. Law does not discriminate or distinguish a profit making unit from a loss making one to disadvantageously place a healthy producer of domestic industry, since trade remedy measure is meant for the domestic industry as a whole. The advance license enjoyed by SI group not being to import of subject goods for domestic sale the appellant shall not succeed in his plea to deprive that pro....
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....m subject countries were considered at appropriate place to make injury analysis in respect of South Korean exports. Volume effect of South Korean exports was examined taking into consideration the volume effect of export from subject industries already notified by final finding dated 4.1.2008 relating to subject countries. Therefore, the plea of inclusion and exclusion of South Korea exports does not survive. 38. The demand and market share in Para 58 of the Notification dated 9.5.2008 in respect of South Korean exports was calculated taking found figures of subject countries. Similarly, evaluation of export price in Para 61 of the Notification dated 9.5.2008 in respect of South Korean export was calculated taking figures of subject countries notified by Notification dated 04.01.2008. While calculating the injury margin, the DA rightly noted that the injury margin relating to the exports from subject industries has no bearing to the exports of South Korea. Therefore, appellants plea of inclusion of South Korean export was warranted in the investigation of exports from the subject countries has no legs to stand. 39. It was also argued that for exclusion of South Korean expor....