Custom, Excise & Service Tax Tribunal
M/S Alcatel-Lucent Shanghai Bell Co. ... vs Designated Authority on 16 September, 2016
CUSTOMS EXCISE & SERVICE TAX APPELLATE TRIBUNAL West Block No.2, R.K.Puram, New Delhi. COURT-I Date of hearing: 09.09.2016 Date of pronouncement: 16.09.2016 A.D. CoD Nos. 51488 & 51490 of 2016 A.D. Stay Application Nos. 51489 & 51491 of 2016 and Anti-Dumping Appeal Nos. 52492 -52493 of 2016 (Arising out of the Final Findings F. No.15/20/2014 - DGAD dated 05.02.2016 passed by the Designated Authority, DGAD and Allied Duties, Ministry of Commerce and Industry and Customs Notification No. 15/2016-Customs (ADD) dated 26.04.2016 by the Ministry of Finance). M/s Alcatel-Lucent Shanghai Bell Co. Ltd., Appellant M/s Alcatel-Lucent India Limited Vs. Designated Authority, ... Respondent
Directorate General of Anti-Dumping and Allied Duties/Ministry of Finance Appearance:
Sh. Seetharaman, Sh. Ankur Sharma, Sh. Dhruv Gupta and Sh. Atul Gupta, Advocates for the appellant.
Shri Amit Singh, Advocate and Sh. Govind Dixit, DR for the Revenue Ms. Reena Khair, Shri Rajesh Sharma, Ms. Rita Jha, Ms. Shreya Dahiya & Ms.Aastha Gupta Advocates & Mr. Vikram Agarwal, C.A. for Interested party.
Coram:
Honble Mr. Justice (Dr.) Satish Chandra, President Honble Mr. S. K. Mohanty, Member (Judicial) Honble Mr. B. Ravichandran, Member (Technical) Final Order No. 53605 53606/ 2016 Per B. Ravichandran:
These two appeals are directed against same Final Findings and Customs Notification and hence are considered together for disposal. Appellant No. 1 is a producer/ exporter of SDH Transmission Equipments (subject goods) from China. Appellant No. 2 is an importer of subject goods in India. The appellants are against Final Finding in sunset review of Anti Dumping duty (AD duty) on the subject goods originating in or exported from China PR and Israel. Originally, the investigation for AD duty against the subject goods was initiated on 21.04.2009. Provisional AD duty was imposed vide Customs Notification No. 132/2009 dated 08.12.2009. Consequent on Final Finding dated 19.10.2010 of the Designated Authority, Directorate General of Anti-Dumping and Allied Duties, Ministry of Commerce and Industry (DA), definitive AD duty was imposed vide Customs Notification No. 125/2010 dated 16.12.2010. On appeal, the Tribunal remanded the matter to the DA for giving a post-decisional hearing to the interested parties and to issue Final Finding thereafter. The DA issued Final Findings on 10.02.2012 confirming the earlier finding dated 19.10.2010. The Domestic Industry (DI) again approached the DA for continuation of AD duties imposed vide Customs Notification dated 16.12.2010. The sunset review in accordance with Section 9A (5) of the Customs Tariff Act, 1975 was initiated on 06.12.2014. In the meantime, the AD duty imposed was extended upto 07.12.2015. The present appeals are against the Final Finding dated 05.02.2016 on completion of sunset review and Customs Notification No. 15/2016 dated 26.04.2016 imposing AD duty on the subject goods.
2. Before proceeding with the merits of the appeals, we note that there is a delay of 25 days in filing these appeals. Ld. Counsel for the appellants prayed for condonation of this delay as it happen due to unavoidable administrative reasons. He submitted that they have challenged the Final Finding before the Honble Delhi High Court by filing Writ Petition. After the customs Notification was issued they filed another Writ Petition in the same Court. The Honble High Court disposed of the Writ Petition with an observation that it would be open to the petitioner to approach CESTAT for appellate remedy. The appellant also requested to DA the list of interested parties but did not get the same. Delay of 25 days occurred in these circumstances and hence the request for condonation was made. Having considered that the delay is only 25 days and has been satisfactorily explained, we condone the said delay and admit the appeals for decision on merit.
3. Ld. Counsel for the appellants raised various points against the Final Finding. The main points of his arguments are as below:
(i) The DA has considered undumped imports also in the injury analysis which is wrong. In terms of Annexure-II of AD Rules, only dumped imports are to be taken into account for analysis. The imports from HETC is undumped and hence should have been factored while analysing the injury to domestic industry.
(ii) The data disclosed with reference to HETC is at the post disclosure stage is different when compared to investigation stage. The interested parties should have been given a chance post disclosure, with full details relating to data of HETC for putting a proper defence.
(iii) The volume of import of subject goods was arrived at based on data taken from private reports (OVUM report), the volume was arrived at by averaging units sale price of domestic industry. This is not sustainable and the sunset review itself is not valid on this ground.
(iv) During the review the DA used consolidated data of DGCI for two tariff headings namely 851762 and 851770. The first one deals with main equipment and the second one deals with parts of all equipments of main heading 8517. In other words, the data relating to second entry will deal with all kinds of parts not restricted to the parts of subject goods alone.
(v) The extension of AD duty after the expiry of validity is not legally sustainable.
4. Ld. Counsel for the DI opposing the appeal submitted that-
(a) In sunset review the existence of dumping alone is not relevant. The likelihood of recurrence of dumping is also to be considered.
(b) There is no categorical evidence or finding to the effect that there is only one exporter from Israel. The DA correctly made cumulative assessment of imports from China and Israel. Israel cannot be excluded unless the whole countrys export is without dumping. The case laws on similar issues were relied upon.
(c) Regarding change in the disclosed data of HETC, it was submitted that revised disclosure is relevant to the party concerned and not to all the parties in the investigation.
(d) The issue relating to reliance placed data from private (OVUM report) it is submitted that the data was provided by DI in support of their petition. The analysis and finding were not based on that report alone. The investigation by DA looks into all aspects including various data submitted by the interested parties. The initiation of AD investigation as well as the Final Finding on original investigation were also challenged on this ground before the Tribunal which were dismissed.
(e) Regarding classification of parts covered by more items then subject goods, it is submitted that the data obtained were segregated based on description and only relevant data relating to subject goods were considered for injury analysis.
5. Ld. Counsel for DA and the ld. AR for Revenue supported the findings on sunset review. It is submitted that the issues raised in the present appeal have all been considered and dealt with by the DA in his findings.
6. We have heard all the parties as above and considered the appeal papers including written submissions. The appellants are challenging the Final Finding in sunset review recommending continuation of AD duty on the subject goods. The first point of objection is that while analysing the material injury, the DA has erred in considering undumped import also in such calculation. We note that the dispute relates to the finding of the DA that there is no dumping of subject goods from Israel. However, we note that the DA recorded that as per the practice the data of entire import volume from Israel has been considered to assess the total demand and to assess injury. The import volume is an important parameter while deciding the material injury to the DI. We note that the appellants could not demonstrate regarding impact of such exclusion of imports in injury analysis. We also note that as regards the volume effect, Annexure-II to the Rules read with Rule 14 makes it clear that volume effect is to be examined in respect of a country after cumulative assessment of imports and not for an individual exporter. Reference can be made to the decision of the Tribunal in Marino Panel Products Ltd. vs. DA 2016 (334) ELT 552 (Tri. Del.) (para 12 and 13). It has not been substantiated before us that ECI Israel is the only exporter of subject goods. As the export volume from a particular country is considered together the DA has taken the total volume of exports from Israel.
7. The appellants pleaded that due disclosure has not been made on all data relating to HETC. Violation of Rule 16 has been alleged. We note that Rule 16 provides for disclosure of information by the DA before giving Final Findings. He has to inform all the interested parties of the essential facts under consideration which form the basis for its decision. The plea of the appellant is that it is only in the Final Finding the dumping margin of HETC China was found to be de minimis during POI. If informed earlier the appellants would have had opportunity to put up their defence. We are not able to appreciate this line of argument. The material facts as required under Rule 16 of AD Rules have been disclosed and notified to all the interested parties. Apparently the data relating to HETC was re-examined based on the inputs received and found to be de minimis and accordingly Final Findings were issued. Such disclosure of relevant data pertaining to a particular interested party has been corrected based on submissions made after disclosure. The appellants are not apparently linked to the said data and analysis which is relevant only to HETC. We do not find any violation as adequate opportunity during all stages of investigation has been given to the appellants. The DA is well within its powers to arrive at the Final Finding based on post disclosure comments received from individual interested parties. The AD Rules do not contemplate another round of exchange of all data, post disclosure, among all the interested parties. In this context, we find no merit in the appellants plea.
8. The appellants also pleaded violation of principles of natural justice with reference to non-disclosure of DGCI data. The appellants relied on Honble Delhi High Court order dated 18.03.2015 in the case of San Disk International Ltd. vs. DA in W.P.(C) No. 744 of 2015. However, the ld. Counsel conceded that the Honble Supreme Court has granted stay on the said High Court order. However, he insisted that the ratio laid-down by the Honble High Court is binding. Regarding the claim of the appellant that detailed DGCI data has not been provided by the DA, we note the consolidated figures as provided by DGCI for the tariff codes for SDH equipment and parts of SDH equipments have been used by the DA. The DA has formed its opinion regarding price underselling and undercutting based on the response filed by co-operative exporters as the DGCI data for injury period could not be matched as the data does not give complete information. We find that the basis of arriving at the conclusion on the volume effect and price effect has been disclosed to all the interested parties in terms of AD Rules. Transactionwise details of DGCI containing confidential information were not disclosed. We find this has not materially affected the effectiveness of defence by the interested parties.
9. Regarding the tariff classification, we note that the main equipment has been correctly categorised and there is no dispute on the same. Regarding parts, the ld. Counsel for the appellant conceded that there is no separate heading for parts of subject goods. However, heading 851770 covers such parts but not exclusive to the subject goods. Hence, he pleaded that the volume data is erroneous with reference to parts. We have noted that apart from tariff heading the data has been analysed based on description of the product also. The data has been accordingly segregated and used for analysis.
10. The appellants also contested the extension of AD duty after the expiry of initial notification. The AD duty levied originally expired on 07.12.2014. The extension of duty was made by Notification dated 05.01.2015, after a gap of 29 days. The Honble Delhi High Court in Kumho Petrochemicals Co. Ltd. 2014 (306) ELT 3 (Del.) held that such extension after expiry is not tenable.
11. We have examined this issue. We note that the sunset review in the present case has been initiated on 06.12.2014, i.e. before expiry of five year duty period of initial levy. Considering the objective, purpose and provisions of Customs Tariff Act, 1975, AD Rules, 1995 it was submitted by the ld. Counsel for DA that when the sunset review is initiated well in time, the same cannot be made infructuous by referring to delay in issue of extension notification. The Honble Delhi High Courts order referred to above has been stayed by the Honble Supreme Court vide order dated 09.03.2015 in SLP (C) Nos. 29268 29269/2014. We note that this ground is raised only as an incidental point by the appellants. The appeals are directed against Final Findings dated 05.02.2016 and Customs Notification No. 15/2016-Cus. ADD dated 26.04.2016 and not against the extension notification. Hence, our decision is on impugned Findings and Notification only.
12. After careful analysis of the points raised by the appellants and also the Final Finding by the DA we do not find any merit in the present appeals. Accordingly, the same is dismissed. The miscellaneous applications for stay are also disposed of.
(Pronounced on 16.09.2016) (Justice Dr. Satish Chandra) President (S. K. Mohanty) Member (Judicial) (B. Ravichandran) Member (Technical) Pant