Gujarat High Court
M/S Jindal Saw Limited Through ... vs Ministry Of Finance on 20 June, 2019
Author: S.R.Brahmbhatt
Bench: S.R.Brahmbhatt, A. P. Thaker
C/SCA/6896/2019 JUDGMENT
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/SPECIAL CIVIL APPLICATION NO. 6896 of 2019
FOR APPROVAL AND SIGNATURE:
HONOURABLE MR.JUSTICE S.R.BRAHMBHATT
and
HONOURABLE DR.JUSTICE A. P. THAKER
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1 Whether Reporters of Local Papers may be allowed to
see the judgment ?
2 To be referred to the Reporter or not ?
3 Whether their Lordships wish to see the fair copy of the
judgment ?
4 Whether this case involves a substantial question of law
as to the interpretation of the Constitution of India or any
order made thereunder ?
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M/S JINDAL SAW LIMITED THROUGH AUTHORISED REPS
SUBRAMANIAM THANGARAJAN
Versus
MINISTRY OF FINANCE
================================================================
Appearance:
MR MIHIR JOSHI, SR. ADVOCATE WITH MR HARSHADRAY A
DAVE(3461) for the Petitioner
MR NIRZAR S DESAI(2117) for the Respondent No. 2
NOTICE SERVED BY DS(5) for the Respondent No. 1
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CORAM: HONOURABLE MR.JUSTICE S.R.BRAHMBHATT
and
HONOURABLE DR.JUSTICE A. P. THAKER
Date : 20/06/2019
ORAL JUDGMENT
(PER : HONOURABLE MR.JUSTICE S.R.BRAHMBHATT) Page 1 of 76 Downloaded on : Tue Jun 25 04:16:00 IST 2019 C/SCA/6896/2019 JUDGMENT
1. Heard learned counsels for the parties. As the counsels for the parties have exchanged their pleadings and argued the matter extensively for final disposal, this matter is being heard and disposed of finally.
2. The present petition is preferred by the petitioner, Domestic Industry and original applicant of substantive application to Designated Authority for seeking Sunset review invoking provisions of section 9A of Custom Tariff Act and Rules , - under Article 226 of the Constitution of India with following prayers:
(a) Grant a writ of Certiorari or any other writ or order or direction in the nature thereof thereby quashing and setting aside the impugned Final Findings 7/18/2018-DGAD dated 01.04.2019 passed by the Respondent No.2 and be pleased to grant consequential orders; and
(b) Pending the hearing and final disposal of this petition, this Honourable Court be pleased to stay the execution and implementation of the Final Findings 7/18/2018-DGAD dated 01.04.2019 and further be pleased to direct the Designated Authority Respondent No.1 herein to extend the existing anti-dumping duties by a further period of 6 months pending the outcome of this petition; and Page 2 of 76 Downloaded on : Tue Jun 25 04:16:00 IST 2019 C/SCA/6896/2019 JUDGMENT
(c) Be pleased to grant ad-interim relief in terms of para-(b) hereinabove;
(d) Pass any such other and further orders as this Hon'ble Court may deem fit and proper in the facts and circumstances of the instant case."
Thus what is essentially under challenge is the final findings No.7/18/2018-DGAD dated 01.04.2019 passed by the respondent no.2 - Designated Authority on account of which the application of the petitioner under Rule 23 (1B) of the Customs Tariff (Identification, Assessment and Collection of Anti-Dumping Duty on Dumped Articles and for Determination of Injury) Rules, 1995 read with Section 9A(5) of the Customs Tariff Act, 1975 for the purpose of continuation of anti- dumping duty on the imports of Ductile Iron Pipes originating in or exported from China PR was rejected and the Designated Authority held that anti dumping duty on the product need not be continued hereafter.
3. Facts in brief, as could be gathered from the memo of petition, deserve to be set out as under:
3.1 The petitioner had filed an application under Rule 5 of the Customs Tariff (Identification, Assessment and Collection of Anti-Dumping Duty on Dumped Articles and for Determination of Injury) Rules, 1995 (hereinafter referred to as "the Rules" for the sake of brevity) for initiation of anti-
dumping investigation into imports of Ductile Iron Pipes (hereinafter referred to as the 'subject goods' for the sake of brevity) originating in or exported from China PR (hereinafter Page 3 of 76 Downloaded on : Tue Jun 25 04:16:00 IST 2019 C/SCA/6896/2019 JUDGMENT referred to as the 'subject country' for the sake of brevity). The respondent no.2 vide the initiation notification No.14/14/2005-DGAD dated 24.02.2006 initiated anti-dumping investigation with respect to the subject goods.
3.2 Vide notification no. 14/14/2005-DGAD dated 23.08.2007, the respondent no.2 issued its final findings and recommended imposition of anti-dumping duty upon the import of the subject goods from the subject country. The Ministry of Finance accepted the recommendations of the respondent no.2 and imposed definitive anti-dumping duty vide Custom Notification No.103/2007 dated 14.09.2007.
3.3 The petitioner filed an application under Rule 23(1B) for initiation of first sunset review investigation for continuation of anti-dumping duty for a further period of 5 years. The respondent no.2 vide initiation notification no.15/1006/2012-DGAD dated 07.09.2012 initiated first sunset review investigation concerning imports of the subject goods from the subject country and vide final findings no.15/1006/2012-DGAD dated 04.09.2013, the respondent no.2 recommended continuation of anti-dumping duty for a further period of 5 years.
3.4 The said recommendation was accepted by the Ministry of Finance vide its Custom Notification No.23/2013- Customs (ADD) dated 10.10.2013 and continued imposition of anti-dumping duty for a further period of 5 years till 09.10.2018.
3.5 Thereafter, petitioner once again approached the Page 4 of 76 Downloaded on : Tue Jun 25 04:16:00 IST 2019 C/SCA/6896/2019 JUDGMENT
respondent no.2 with a substantiated application for initiation of second sunset review investigation under Rule 23(1B) of the Rules and provided all necessary information and analysis and evidences / submissions to prove that the cessation of the existing anti-dumping duties would lead to the continuation of dumping and injury from the subject country through the application.
3.6 The respondent no.2 conducted an oral hearing on 15.05.2018 whereby the petitioner was asked to present its case and make its submissions. The petitioner appeared before the respondent no.2 and made its submissions with respect to its application for initiation of sunset review investigation. After two days of hearing, the respondent no.2 vide order dated 17.05.2018, rejected the application of the petitioner for initiation of sunset review investigation concerning imports of subject goods from the subject country.
3.7 Being aggrieved by the order dated 17.05.2018 passed by the respondent no.2, petitioner filed Special Civil Application No.12368 2018 before this Court praying for a direction to the respondent no.2 to initiate the sunset review investigation. The said petition was allowed vide judgment and order dated 26.09.2018 by setting aside the impugned order dated 17.05.2018, as the same was without reasons and the respondent authority was directed to decide the application requesting a sunset review afresh, in accordance with law, within six months from the date of receipt of the said order and the period of anti dumping duty, which ceases to have effect on and from 09.10.2018 was ordered to be extended.
Page 5 of 76 Downloaded on : Tue Jun 25 04:16:00 IST 2019C/SCA/6896/2019 JUDGMENT 3.8 The respondent no.2, despite direction of this Court
did not initiate the sunset review investigation. Hence, the petitioner was constrained to move Misc. Civil Application in Special Civil Application No.12368 of 2018 on 08.10.2018, praying for an immediate direction to the respondent no.2 to comply with order dated 26.09.2018 passed by this Court in Special Civil Application No.12368 of 2018. Vide order and judgment dated 08.10.2018, this Court directed the respondent no.2 and the Ministry of Finance to take follow up action.
3.9 After the said order of this Court, the respondent no.2 vide Notification No.7/18/2018-DGAD dated 09.10.2018 initiated the second sunset review investigation concerning imports of the subject goods from the subject country. The respondent no.1 also complied with such directions and issued Customs Notification No.51/2018-Customs (ADD) dated 09.10.2018 extending duties by only 6 months viz. till 09.04.2018.
3.10 The respondent no.2 conducted an oral hearing on 25.01.2019 whereby the petitioner was asked to present its case and make its submissions. The petitioner appeared before the respondent no.2 and made its submissions with respect to its application for sunset review investigation. Thereafter, on 8th and 9th March 2019, the respondent no.2 visited the premises of the petitioner to conduct an on-the- spot verification of the documents and information submitted by the petitioner and issued its verification report.
Page 6 of 76 Downloaded on : Tue Jun 25 04:16:00 IST 2019C/SCA/6896/2019 JUDGMENT 3.11 The respondent no.2 issued the disclosure
statement in terms of Rule 16 on 19.03.2019. The petitioner submitted its comments on the disclosure statement on 25.03.2019. Thereafter, the respondent no.2 issued the Final Findings on 01.04.2019 concluding that the continuation of the existing anti-dumping duties on the subject goods are not warranted in a situation when there was total non-cooperation by exporters, importers or the Government of China PR.
3.12 Being aggrieved by the Final Findings dated 01.04.2019 recorded by the respondent no.2, the petitioner preferred the present petition.
4. Learned counsel for the petitioner placed on record brief submissions, which verbatim reproduced as under:
Brief Submissions on behalf of Petitioner Date Event 24.02.2006 The respondent no.2 vide the Initiation Notification No.14/14/2005/DGAD dated 24.02.2006 initiated anti-dumping investigation with respect to the Subject Goods. 23.08.2007 The respondent issued its final findings vide Notification No.14/14/2005-DGAD dated 23.08.2007 and recommended imposition of anti-dumping duty upon the import of the Subject Goods from the Subject Country. 14.09.2007 The respondent no.1 accepted the recommendations of the respondent no.2 and imposed definitive anti-dumping duty vide Custom Notification No.103/2007 dated Page 7 of 76 Downloaded on : Tue Jun 25 04:16:00 IST 2019 C/SCA/6896/2019 JUDGMENT 14.09.2007.
07.09.2012 The respondent vide Initiation Notification No.15/1006/2012-DGAD dated 07.09.2012 initiated the first sunset review investigation concerning imports of the Subject Goods from the Subject Country.
04.09.2013 The respondent no.2 vide its final findings no.15/1006/2012-DGAD dated 04.09.2013 recommended continuation of anti-dumping duty for a further period of 5 years. 10.10.2013 Respondent no.1 accepted the recommendation of Page No.71- Respondent no.1 vide its Custom Notification 72 No.23/2013-Customs (ADD) dated 10.10.2013 and continued imposition of anti-dumping duty for a further period of 5 years till 09.10.2018.
March 2018 The petitioner once again approached the respondent with a duly substantiated application for initiation of second sunset review investigation under Rule 23(1B) of the Rules.
14.05.2018 Petitioner vide its letter dated 14.05.2018
further submitted additional
evidences/submissions to prove that the
cessation of the existing anti-dumping duties would lead to the continuation/recurrence of dumping and injury from the subject country. 15.05.2018 The respondent conducted an oral hearing on 15.05.2018 whereby the petitioner was asked to present its case and make its submissions.
17.05.2018 The respondent no.1, vide order dated Page 8 of 76 Downloaded on : Tue Jun 25 04:16:00 IST 2019 C/SCA/6896/2019 JUDGMENT
17.05.2018, rejected the application of the petitioner for initiation of sunset review investigation concerning imports of Subject Goods from Subject Country.
July 2018 Being aggrieved by the decision of the Respondent No.1, petitioner filed Special Civil Application No.12368 before this Hon'ble Court praying for a direction to the respondent no.2 to initiate the sunset review investigation. 26.09.2018 The Special Civil Application No.12368 was allowed by the Hon'ble court vide its order and judgment dated 26.09.2018 directing respondent no.1 to initiate sunset review investigation.
08.10.2018 Despite clear instructions by this Hon'ble court to initiate the sunset review investigation, the respondent no.2 did not initiate the sunset review investigation. Petitioner was constrained to move Special Civil Application No.12368 praying for an immediate direction to the respondent no.2 to comply with order dated 26.09.2018 passed in Special Civil Application No.12368 of 2018.
09.10.2018 This Hon'ble Court vide order and judgment dated 08.10.2018 in Special Civil Application No.12368 on 08.10.2018 directed the respondent no.2 and the Ministry of Finance to take follow up action.
09.10.2018 After the order of this Hon'ble Court, the respondent no.2 vide Notification No.7/18/2018-DGAD initiated the second sunset Page 9 of 76 Downloaded on : Tue Jun 25 04:16:00 IST 2019 C/SCA/6896/2019 JUDGMENT review investigation concerning imports of the Subject Goods from the Subject Country. 09.10.2018 The respondent no.1 also complied with such directions and issued Customs Notification No.51/2018-Customs (ADD) dated 09.10.2018 extending duties by only 6 months viz. till 09.04.2019.
25.01.2019 The respondent no.2 conducted an oral hearing on 25.01.2019 whereby the petitioner was asked to present its case and make its submissions.
08/09.03.20 The respondent no.2 visited the premises of the 19 petitioner to conduct an on-the-spot verification of the documents and information submitted by the petitioner and issued its verification report. 19.03.2019 The respondent no.2 issued the disclosure statement in terms of Rule 16 of Anti-dumping Rules.
25.03.2019 The petitioner submitted its comments on the disclosure statement.
01.04.2019 The respondent no.2 in a perfunctory manner without even considering or addressing the submissions made by the petitioner, issued the Final Findings concluding that the continuation of the existing anti-dumping duties on the subject goods are not warranted.
April 2019 Being aggrieved by the said Final Findings of the Respondent no.1, the petitioner filed Special Civil Application no.6896 of 2019. 05.04.2019 This Hon'ble Court was kind to grant an ex-
parte order, directing further extension of the Page 10 of 76 Downloaded on : Tue Jun 25 04:16:00 IST 2019 C/SCA/6896/2019 JUDGMENT anti-dumping duties by not less than one month.
10.04.2019 The respondent no.1 complied with such directions and issued Customs Notification No.18/2019-Customs (ADD) extending duties by only 1 months viz. till 09.05.2019. 03.05.2019 This Hon'ble Court deemed it appropriate to direct further extension of the anti-dumping duties by 45 days.
09.05.2019 The respondent no.1 complied with such directions and issued Customs Notification no.18/2019-Customs (ADD) extending duties by 45 days viz. till 23.06.2019.
1. The present petition is filed by M/s.Jindal Saw Limited (hereinafter referred to as Petitioner), against the Final Findings No.7/18/2018-DGAD dated 01.04.2019 passed by the Designated Authority, Directorate General of Trade Remedies (hereinafter referred to as "Respondent no.2") by way of which the application of the petitioner under Rule 23 (1B) of the Customs Tariff (Identification, Assessment and Collection of Anti-Dumping Duty on Dumped Articles and for Determination of Injury) Rules, 1995 (hereinafter referred to as "the Rules") read with Section 9A(5) of the Customs Tariff Act, 1975 (hereinafter referred to as the 'Act') for the purpose of continuation of anti-dumping duty on the imports of Ductile Iron Pipes Page 11 of 76 Downloaded on : Tue Jun 25 04:16:00 IST 2019 C/SCA/6896/2019 JUDGMENT (hereinafter referred to as "DI Pipes" or "Subject Good") originating in or exported from China PR (hereinafter referred to as "Subject Country") was rejected.
2. The arguments advanced by the petitioner on various issues including its reply to the arguments raised by the respondents are summarized below:
3. The petitioner submitted that the present Special Civil Application is maintainable in view of the following grounds:
i. It appears from the scheme of Section 9C that it only gives power to the tribunal to confirm, modify or annual the order appealed against. The said power to confirm, modify or annual would have been rendered meaningless if the duties would have been lapsed during the pendency of the Appeal. In terms of the settled law declared by the Hon'ble Supreme Court in the case of Kumho Petrochemicals (Civil Appeal No.008312 of 2017). Further, the procedural requirement of service to all the respondents in and outside India for listing of the Appeal would have left the petitioner with no time by arguing its appeal finally. In any case, the power to grant stay is not specifically conferred. Assuming but not admitting that Page 12 of 76 Downloaded on : Tue Jun 25 04:16:00 IST 2019 C/SCA/6896/2019 JUDGMENT such power does exist, even then the same was required to be exercised before the expiry of the duty which as aforesaid was not possible in the facts of this case.
ii. At the time of filing of the petition, the duties were due to expire within a week and therefore, intervention of the Court was needed to grant interim extension of the duties. However, since there is no ancillary power under Section 9C in the nature of powers under Article 226, the tribunal would not have been able to grant interim extension of the duties. In view thereof, the alternative remedy would not have been efficacious. Therefore, the judgment of Jindal Poly Films is not applicable in the facts of this case.
iii. Since the duties were due to expire within a week of the issue of the impugned order by the Respondent no.2, the tribunal would not have been in a position to dispose of the matter within time. Therefore, no effective alternative remedy was available to the petitioner other than to file the present Special Civil Application.
iv. Since there are issues involving breach of principles of natural justice and failure to follow procedural requirements by the respondent no.2, the Special Civil Application Page 13 of 76 Downloaded on : Tue Jun 25 04:16:00 IST 2019 C/SCA/6896/2019 JUDGMENT is maintainable in terms of the judgment of Hon'ble Supreme Court in the case of Whirlpool Corporation vs. Registrar of Trade Marks, Mumbai [(1998) 8 SCC 1] and the judgment of this Hon'ble Court in the case of Nirma Ltd., Vs. Union of India and Ors [Special Civil Application Nos.16426 to 16429 of 2016].
v. The issues raised in the present petition are in relation to breach of natural justice, non-application of mind and reliance on data which did not relate to the Product under consideration. Further, the Petitioner also raised issues relating to arbitrariness, bias and discrimination. To that extent, it cannot be said that the matter is highly technical in nature and outside the purview of the Article 226 of the Constitution of India. Declining to exercise the specific powers conferred on an officer can be termed as jurisdictional error in terms of law.
4. The petitioner submitted that the impugned Final Findings dated 01.04.2019 issued by respondent no.2, concluding that continuation of anti-dumping duty is not warranted is perverse in law, inconsistent with the rules and suffers from total non- application of mind to the facts and circumstances and submissions made by the petitioner. The petitioner also submitted that Page 14 of 76 Downloaded on : Tue Jun 25 04:16:00 IST 2019 C/SCA/6896/2019 JUDGMENT the impugned Final Findings have been issued by the respondent no.2 with prejudiced mind ignoring the legal provisions and the same is patently illegal.
5. The petitioner submitted that the respondent no.2 committed error in law when it failed to disclose to the petitioner methodology adopted in construction of normal value and the dumping margin. The petitioner submitted that the data and figures worked upon the respondent no.2 could not have been kept confidential from the petitioner as respondent no.2 has no right to seek confidentiality under Rule 7 as per Hon'ble Supreme Court decision in the case of Reliance Industries.
6. The petitioner submitted that the respondent no.2 erred in reaching conclusions on export price in the impugned findings. It was submitted that the respondent no.2 himself recorded that the import data was unreliable due to misclassification of import item which apparently in his own words was not a like article. Despite such observations, adjustments were made to this data to reach absurd results on export price and hence the conclusion reached on the basis of such data cannot hold ground. Clearly, the analysis of the respondent no.2 was based on negligible Page 15 of 76 Downloaded on : Tue Jun 25 04:16:00 IST 2019 C/SCA/6896/2019 JUDGMENT imports in the context of domestic market and that too of dissimilar product which amounts to no imports at all leading to the situation identical to one of 2013.
7. The petitioner submitted that there was stark contradiction between the conclusion reached by the respondent no.2 in the earlier sunset review investigation and the present sunset review investigation in completely identical circumstances. The petitioner provided a comparative chart comparing the conclusion and methodology of the respondent no.2 in earlier sunset review investigation and the present sunset review investigation. This comparison clearly go to show that the impugned conclusions arrived at by respondent no.2 are arbitrary. For else of reference, the same is attached again as Appendix-A.
8. The petitioner submitted that despite submission of data with respect to likely dumping margin, likely injury margin, likely price undercutting surplus capacities of Chinese producers etc., the respondent no.2 failed to appreciate the same and the impugned Final Findings does not even deal with the said submissions of the petitioner. To that extent, the Final Findings are non- speaking and non-reasoned and contrary to Page 16 of 76 Downloaded on : Tue Jun 25 04:16:00 IST 2019 C/SCA/6896/2019 JUDGMENT requirements of Rule-17 and settled principles applicable to a quasi judicial authority.
9. The petitioner submitted that bias of the respondent no.2 is writ large by the fact that it misstated the statement of the petitioner in the findings in paragraph 64(1) to state that even as per the Domestic Industry there is no likelihood of any import of subject goods having taken place. The petitioner also submitted that despite objection raised by the petitioner in its post disclosure comments with respect to correctness of the said statement, the respondent no.2 still proceeded with the same reasoning in paragraph 67(iii) of the impugned Final Findings.
10. The petitioner submitted that the uncontroverted evidences submitted by it during the course of the proceedings were either completely ignored by the respondent no.2 or were arbitrarily rejected without any basis.
11. The petitioner submitted that the respondent no.2 failed to appreciate the evidences furnished by the petitioner with respect to (I) huge surplus capacities in China, (ii) Chinese prices to the other countries, (iii) price attractiveness of Indian Page 17 of 76 Downloaded on : Tue Jun 25 04:16:00 IST 2019 C/SCA/6896/2019 JUDGMENT market, (iv) Chinese exports to other countries.
12. The petitioner submitted that the respondent no.2, despite admitting the existence of huge surplus capacities in China based on the incontrovertible documentary evidence filed by it, erroneously found such evidences inconclusive to establish the likelihood of the surplus capacities to find their way into India. The petitioner submitted that the legal requirement is only to establish the likelihood or preponderance of probability that the surplus goods are likely to come into country. However, contrary to legal requirement, the respondent no.2 carved out a test that the petitioner must establish "beyond any doubt" that the surplus capacity would find its way in India. The test applied is contrary to plain meaning of the word, "likelihood" under the Act and the Rules and is a patent error of law going to the root of the matter.
13. The petitioner submitted that the respondent no.2 failed to appreciate that the improvement in the economic parameters of the petitioner was only on account of the anti- dumping duties in place against the imports of the subject goods. The petitioner refuted the submission of the respondent no.2 that there Page 18 of 76 Downloaded on : Tue Jun 25 04:16:00 IST 2019 C/SCA/6896/2019 JUDGMENT was no injury being faced by the Domestic Industry. The petitioner submitted that the present case being one related to sunset review of the duties already in place, the absence of current injury becomes irrelevant. The whole argument of the respondent was based on the fact that there has been improvement in the economic parameters of the Domestic Industry. However, the same does not take into account the fact that in sunset review proceedings, likelihood of injury takes importance over current injury. Therefore, even in a situation where there is absence of current injury, the duties are required to be continued if there is a likelihood of injury in case of cessation of duties.
14. The petitioner has also substantiated that the findings are perverse in nature for aforesaid reasons and also would shock the conscience of the Court as reliance has been placed on the data which as per the Designated Authority himself did not relate to the subject goods.
15. The petitioner thoroughly and specifically pointed out all the legal errors in response to the disclosure statement. The disclosure statement is issued by the respondent no.2 in terms of Rule 16 and the Page 19 of 76 Downloaded on : Tue Jun 25 04:16:00 IST 2019 C/SCA/6896/2019 JUDGMENT same forms the basis for the final determination of the respondent no.2. However, the respondent no.2 ignored all the objections raised by the petitioner in a perfunctory manner and acted with a prejudiced mind.
16. Therefore, the petitioner humble prays this Hon'ble Court to allow the Special Civil application and grant the relief prayed for to the petitioner.
Issue wise comparison of the analysis carried out in the 1st (earlier sunset review and the impugned Final Findings.
Determination of normal value 1st (earlier) Sunset 36. The Authority has relied on the review Findings international prices of major raw material along with the consumption norms, conversion cost and SGA of the most efficient domestic producer. Profit @ 5% on the cost of production has been added to arrive at the constructed normal value. By adopting this method, the constructed normal value is determined as US$*** per Mt. Present Sunset review 31. As pa part of the proceedings in Findings this investigation, the Authority had sent questionnaires to the known exporters/producers from the subject country advising them to provide information in the form and manner prescribed. There has been no response to the questionnaire nor has there been any submission by any of the Chinese producers/exports. In the Page 20 of 76 Downloaded on : Tue Jun 25 04:16:00 IST 2019 C/SCA/6896/2019 JUDGMENT absence of cooperation from the Chinese exporters/producers, the Authority determines to construct the normal value on the basis of facts available.
32. The constructed normal value so determined is as Rs.*** per MT (USD *** per MT) Comments The methodology used for the computation of normal value has not been disclosed to the petitioner as against the full disclosure of methodology in the earlier case.
Determination of export price 1st (earlier) Sunset 37. The Authority notes that there are review Findings no exports of the subject goods to India from the subject country in the entire injury investigation period including the POI and the post POI. In the absence of exports to India by any of the Chinese exporters including the responding producer/exporter SGPL from China, the Authority has not been able to determine the ex-factory export price for the POI and the post POI period.
Present Sunset review 35. The Authority notes that imports Findings of subject goods from China during POI is to the tune of 73MT at Rs.1,54,000 per MT. It is further noted that the price of import is abnormal, which is established by the fact that the DI is selling the subject goods at approx. Rs.*** per MT only. It is noted that the import statistics of this item points to either misclassification of the import item or it not being the like article. However, the Authority has also calculated the export price based on the available import data. Export price has been adjusted for ocean freight, marine insurance, port expenses, commission, inland freight and indirect taxes (VAT) which may have been incurred by the Page 21 of 76 Downloaded on : Tue Jun 25 04:16:00 IST 2019 C/SCA/6896/2019 JUDGMENT exporter for exporting material to India,in order to put normal value and export price at the same leveled of trade. The export price to be determined is as Rs.*** per MT.
Comments In the present case, the Authority despite nothing that the price of import is abnormal and the import statics of this item points to either misclassification of the import item or it not being the like article, went on to compute export price on the basis of such admittedly misclassified unlike articles and made the determination of dumping margin on the basis of such erroneous export price.
Methodology for determination of likelihood of dumping and injury.
1 st (earlier) Sunset 69... [The likelihood of dumping and review Findings injury is required to be determined on the basis of the total exports from China to various countries.
Present Sunset review No such examination, Findings Comments Despite the submission of information with respect to low priced exports of Chines producers to other countries, the Authority made no such Analysis. In para 64(iv) of the impugned Final Findings, the Authority has noted the submission and evidences presented by the petitioner that more than 70% of the quantities exported from China to other countries are at the price which would have a positive injury margin and around 83% of the quantities sold to other countries are at dumped prices. This proves beyond an iota of doubt that there is every likelihood that at these prices, if the excess capacity is diverted to India, injury to Domestic Industry imminent.
Non-participation of Chinese Exporters 1 st (earlier) Sunset 71. All other interested parties who Page 22 of 76 Downloaded on : Tue Jun 25 04:16:00 IST 2019 C/SCA/6896/2019 JUDGMENT review Findings could have given valuable information to the Authority have preferred not to cooperate with the Authority in the present investigations. The Authority notes that the relevant information from the interested parties is more important in sunset review investigations where an assessment of likelihood is required to be made. Present Sunset review No such examination. Findings Comments Despite non-cooperation by Government of China and producers, exporters and importers, adverse inference is drawn against domestic industry for absence of information. Likely export price 1 st (earlier) Sunset 72..... As regards the submission of review Findings SGPL that only the weighted average price to rest of the world should be taken into consideration for the purpose of estimating the likely export price to India, the Authority notes that even if weighted average price of exports from China to globally is above normal value, the same does not mean that dumping from China is unlikely in the event of cessation of anti dumping duty, particularly in a situation where a significant part of these exports are at dumped prices and are likely to cause injury to the domestic industry. Thus, any determination made on the basis of weighted average price of exports could be highly misleading. The facts of the present case in fact have established that even when weighted average price of exports is above normal value, a significant portion of these exports are at dumped and injurious price. The Authority thus considers to take into account the average export price of dumped and injurious transactions from China to all countries (other than India).
Page 23 of 76 Downloaded on : Tue Jun 25 04:16:00 IST 2019C/SCA/6896/2019 JUDGMENT Present Sunset review No such examination. Findings Comments Likely export price from China has not been computed in the impugned Final Findings despite information the regarding the same submitted by the petitioner.
Likely export price in the absence of imports 1 st (earlier) Sunset 73. The Authority considers it review Findings appropriate to take into account the average export price of dumped and injuries transactions from China to all countries (other than India) based on the transaction-wise exports data submitted by the domestic industry from HS International Inc (impexp.com) - Sydney, Australia. The Authority has adopted this method because in the absence of actual exports to India, the Authority is determining the likely export price at which subject goods if diverted to India are likely to cause dumping and injury to the domestic industry.
Present Sunset review No such examination. Findings Comments Likely export price from China has not been computed in the impugned Final Findings despite information the regarding the same submitted by the petitioner. In fact export price for 73 MT has been taken into account though it was specifically recorded that the price of export was abnormal. It was also recorded in paragraph 35 of impugned Final Findings (page 58 of petition) by respondent no.2 that the "importer statics of the this item points to either misclassification of the import item or it not being the like article."
Likely export price and dumping margin 1 st (earlier) Sunset 74. The likely ex-works export price of review Findings the exports from China PR is determined by the Authority by making appropriate adjustments to Page 24 of 76 Downloaded on : Tue Jun 25 04:16:00 IST 2019 C/SCA/6896/2019 JUDGMENT the likely net export price on account of inland freight and insurance, commission, port expenses, bank charges and VAT adjustment. After making these adjustments, the likely adjusted ex-factory export price determined is as US$*** per MT.
Likely Dumping Margin during POI.
US$ (per MT)
Normal Value ***
Net Export Price ***
Likely Dumping ***
Margin
Likely Dumping ***
Margin%
Likely Dumping 0-10
Margin % Range
Present Sunset review No such examination. Findings Comments Likely export price and likely dumping margin from China has not been computed in the impugned Final Findings despite information the regarding the same submitted by the petitioner.
Likelihood of dumping and injury 1st (earlier) Sunset 75. For the purpose of determining review Findings likelihood of dumping and injury, the Authority has analyzed the transaction wise export prices of Chinese producers to countries other than India as submitted by the Domestic Industry from HS International Inc (impexp.com) - Sydney, Australia. 76. Present Sunset review No such examination. Findings Comments Despite submission of information regarding Chinese prices to other countries, no such procedure is followed in impugned Final Findings. Surplus capacities in China 1st (earlier) Sunset 76. From the data/information review Findings available with the Authority, it is Page 25 of 76 Downloaded on : Tue Jun 25 04:16:00 IST 2019 C/SCA/6896/2019 JUDGMENT noted that the total volume of exports from China PR to other countries during the POI was 4,88,530 MT at an average FOB price of Rs.39,196 per MT, out of which 1,13,641 MT (23%) was at dumped prices as well as at prices which are lower than the non- injurious price of the Domestic Industry. The demand of the subject goods in India during the POI was 6,64,628 MT. This 23% of the total exports from China which are at dumped as well as injurious prices constitute 17% of the total demand in India. This 17% is substantial volume and assumes great significance considering the fact that there is huge capacity available in China; none of the major producers/exporters from China as well as importers in India have responded to the investigation and if the total demand in India is seen, there is every likelihood that if the anti-dumping duties are revoked, the percentage of dumped as well as injurious exports to India are likely to increase and take away major portion of the India demand. Further, even if the export behaviour and production capacity of the only responding interested party SGPL is seen, it is noted that as per the information available with the Authority, the known capacity of SGPL is 17,00,000 MT and the production during the POI is only 3,25,367 MT. This leaves surplus capacity of 13,74,633 MT with SGPL alone which is almost double the demand in India. This available surplus capacity can be utilised by SGPL for likely exports to India at the minimum dumped and injurious export price to the world so determined above. (Emphasis Added) Present Sunset review No such examination.
Findings Page 26 of 76 Downloaded on : Tue Jun 25 04:16:00 IST 2019 C/SCA/6896/2019 JUDGMENT Comments The procedure and conclusions
reached in the context of Surplus Capacity in earlier Final Findings are not followed in impugned Final Findings. In fact, a diagonally opposite stance has been taken by the Designated Authority despite exactly similar information being on record. Surplus Capacities in China 1st (earlier) Sunset 78. On the basis of the information review Findings made available by the Domestic In-
dustry from the websites of some pro- ducers/exporters as also other reliable websites of some other producers/ex- porters, it is seen that the Chinese producers/exporters have ample pro- duction capacities with them. They are also exporting Ductile Iron Pipes around the world. No other interested party has either controverted the in- formation or provided any counter-fac- tual information. Moreover, it is noted that the interested parties have failed to give any additional factual informa- tion which they wanted the Authority to consider while determining the is- sue of excess capacities. Thus, there is ample evidence to conclude that the Chinese producers have substantial production capacities. These capacit- ies are in themselves more than the total production capacity of the do- mestic industry. The importance of such huge production capacities and exports by the Chinese producers/ex- porters cannot be ignored. (Emphasis Added).
Present Sunset review 64....
Findings 3... In relation to the surplus capacity and the likelihood of its diversion to India in case of revocation of duties, it is noted that mere existence of surplus capacity does not establish the likelihood of diversion of surplus production to India prove the Page 27 of 76 Downloaded on : Tue Jun 25 04:16:00 IST 2019 C/SCA/6896/2019 JUDGMENT likelihood of imports if anti dumping duties were to be revoked.
Comments The procedure and conclusions reached in the context of Surplus Capacity in earlier Final Findings are not followed in impugned Final Findings. In fact, a diagonally opposite stance has been taken by the Designated Authority despite exactly similar information being on record. Likelihood of dumping and injury 1st (earlier) Sunset re- 79. Considering the facts available on view Findings record with regard to the likely prices to India and the fact that there are huge production capacities in China and that none of the major producers/exporters from China as well as importers in India have re- sponded to the investigation, the Au- thority determines that if the existing duties are removed, there is every likelihood of the subject goods com- ing to India at dumped prices which are further likely to cause injury to the domestic industry.
Present Sunset review No such examination. Findings Comments Despite similar facts and circum-
stances, a contradictory approach taken by the Authority in the im-
pugned Final Findings.
Likely price undercutting and price underselling 1st (earlier) Sunset re- 80. Having regard to the contentions view Findings raised, information provided and sub-
missions made by the interested parties and facts available before the Authority and on the basis of above analysis including analysis of likeli- hood of continuation of dumping and injury, the Authority determines that :
Page 28 of 76 Downloaded on : Tue Jun 25 04:16:00 IST 2019C/SCA/6896/2019 JUDGMENT
(i) The constructed Normal Value and the likely net export price to India clearly indicate the likelihood of dumping from China PR if the exist- ing duties are allowed to be revoked.
(ii) The likely export prices from China PR clearly indicate the likeli- hood of injury to the Domestic In-
dustry in the form of price undercut- ting as shown below.
Likely Under Cutting During POI.
US$ (per MT)
NSR ***
Landed Value ***
(Likely)
Likely Under ***
Cutting Margin
Likely Under ***
Cutting Margin%
Likely Under 5-15
Cutting Margin%
Range
(iii) The likely export prices from China also clearly indicate the likeli- hood of injury to the Domestic In-
dustry in the form of price undersell- ing as shown below.
US$(per MT)
NSR ***
NIP ***
Landed Value ***
(Likely)
Page 29 of 76
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Likely Under Selling ***
Margin%
Likely Under Selling 0-10
Margin% Range
(iv) Further, by taking likely prices to India from the same data, the injury margin is also positive.
(v) Based on the analysis of informa- tion on production capacity of the subject goods of the Chinese produ- cers/exporters; non-cooperation of the major Chinese producers/export- ers in the investigation and the price attractiveness of the domestic market in India, there is every likelihood that if the duties are revoked, the volume of dumped and injurious exports from China to India is likely to increase and likely to cause injury to the do- mestic industry.
Present Sunset review No such examination. Findings Comments Despite submission of information re-
garding likely price undercutting and likely price underselling, no such pro- cedure is followed in impugned Final Findings.
5. In support of aforesaid contentions, learned counsel for the petitioner has relied upon the following Judgments:
(i) In case of Nirma Limited Vs. Union Of India, reported in 2017 (358) E.L.T. 146 (Guj.). Special emphasis was given to paragraph nos.38 to 38.2;
(ii) Decision of this Court rendered in Special Civil
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Application No. 12368 of 2018 dated 26.09.2018;
(iii) Order dated 8.10.2018 passed by this Court in Misc. Civil Application No.1 of 2018 in Special Civil Application No. 12368 of 2018.
6. Learned counsel for the respondents mainly contended that in terms of Section 9(C) of the Customs Tariff Act, 1975, the alternative remedy in form of Appeal to CISTAT is available and therefore, this Court may not go into the nitty- grity of the facts incorporated in the Final Findings and that the Final Findings is rendered by the respondent no. 2 - Designated Authority after affording full opportunity and in consonance with the provisions of Customs Tariff Act and Rules applicable, therefore, this Court may not interfere therewith. The gist of submissions is tendered by the respondents, which needs to be verbatim set out hereunder for ready reference:
"BRIEF Written submissions on behalf of the respondents "1. The present petition is not maintainable and this Hon'ble Court may not entertain present petition as the petitioner has alternative and efficacious alternative remedy provided by statute of preferring an appeal before Division Bench of CISTAT as provided u/s.9(c) of Customs Tariff Act, 1975.
2. The petitioner has not stated in the petition as to how the petitioner is not left Page 31 of 76 Downloaded on : Tue Jun 25 04:16:00 IST 2019 C/SCA/6896/2019 JUDGMENT with any other option but to file present petition without availing alternative remedy as per section 9(c) of Customs Tariff Act. The petitioner has in para 36 of the petition on page No.45 only stated that SLP is adjourned before the Hon'ble Supreme Court and hence the petitioner has preferred the present petition. However, pendency of SLP cannot be said to be a ground to bypass the alternative remedy as by way of SLP order passed by the Hon'ble Gujarat High Court dated 26/09/2018 and 08/10/2018 passed in SCA No.12368 were preferred. Whereas by way of present petition final findings dated 01.04.2019 is challenged which is altogether different cause of action and hence the petitioner should be relegated to avail alternative remedy available to him of filing an appeal before CISTAT as per section 9(c) of The Customs Tariff Act, 1975.
3. The petitioners argument that the Hon'ble CISTAT does not have power to issue direction as per section 9(c) (3) of The Customs Tariff Act, 1975 cannot be accepted. The scheme of the act provides that the Tribunal has power to confirm, modify or annual the order passed by the Designated Authority. Power to modify also includes the power to issue directions.Page 32 of 76 Downloaded on : Tue Jun 25 04:16:00 IST 2019
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4. The Hon'ble Tribunal also can pass interim orders and thereby protect the interest of the petitioner if after hearing the petitioner the Hon'ble Tribunal arrive at such conclusion and therefore, the argument of non availability of efficacious remedy cannot stand.
5. The subject matter is of highly technical nature and by way of various grounds stated in the petition the petitioner has gone into technical aspects of investigation carried out by the designated authority and has questioned merit of investigation by raising certain contentions and questioning certain data. The Hon'ble High Court under article 226 of the Constitution of India may not go into such questions but the same can be considered by the Hon'ble Tribunal as the Division Bench of the Hon'ble Tribunal consist of one judicial member and one technical member who can examine the technical aspects of the final findings in a better way as the purpose behind constitution of division bench having a technical member is to see that even technical aspects also can be examined throughly.
6. In support of submission about availability of alternative remedy and hence the petition may not be entertained, the Page 33 of 76 Downloaded on : Tue Jun 25 04:16:00 IST 2019 C/SCA/6896/2019 JUDGMENT respondents are relying upon following judgments.
1. 2018 (362) ELT 994 (DEL) Jindal Polyfilms Ltd. V/s.
Designated Authority.
Para 35 to 42 are relied on by the respondent.
2. UTOKUMPU OYJ. Vs. Union of India Para 15 to 23 are relied on by the respondent.
In view of aforesaid judgments a petition under article 226 is not maintainable and the petitioner should be relegated to alternative remedy.
Arguments on Merit.
1. The Designated authority has passed the order by following the procedure as mentioned in the rules. There is no procedural laps and therefore, the impugned order is just, legal and proper.
2. As per the view taken in case of OCTOCOMPU OYJ, (208 (362) ELT 994 (DEL)) that is distinction between lake of jurisdiction and alleged error in exercise of jurisdiction. It Page 34 of 76 Downloaded on : Tue Jun 25 04:16:00 IST 2019 C/SCA/6896/2019 JUDGMENT is not the case of the petitioner that the designated authority who has issued the final findings lakes the jurisdiction. But the case of the petitioner is that the final findings are erroneous and hence such facts cannot be examined under article 226 of the Constitution of India.
3. The petitioner has participated in the investigation and the contentions taken by the petitioner were not taken by the petitioner by way of objection during the investigation and hence after having participated in the investigation petitioner cannot take grievance about the procedure followed by the Designated Authority or about the data on the basis of which the investigation was carried out.
4. It is not the case of the petitioner that the final findings are perverse in nature or that it may shock the conscious of the Hon'ble Court which may call for the intervention by this Hon'ble Court. The petitioner has also not alleged any malafides against the designated authority and therefore, in absence of any such allegations the final findings becomes final and cannot be questioned.
5. Even otherwise, the respondent no.2 has Page 35 of 76 Downloaded on : Tue Jun 25 04:16:00 IST 2019 C/SCA/6896/2019 JUDGMENT filed detailed affidavit in reply whereby merits of the final findings as well as how the final findings were arrived at is explained in detail in paragraph no.24 to 26. The respondent has stated as under.
"24. In the course of the investigation, the applicants made certain submissions concerning the likelihood of continuation or recurrence of dumping and injury, which were duly recorded by respondent no.2 in the impugned Final Findings. The gist of the applicants' submissions is reproduced herein below for convenience.
a. The absence of exports from China PR proves that the subject imports cannot compete with Indian producers unless they are dumped. There is every likelihood of huge imports if the duties are not extended given the unutilized capacity to produce the subject goods in China PR.
b. The investigation authority needs to determine the likely export price to India on the basis of export prices of the subject goods from China PR to an appropriate third country such as Vietnam, Sri Lanka and Turkey.
c. 70% of the quantities exported from China PR to other countries are at an Page 36 of 76 Downloaded on : Tue Jun 25 04:16:00 IST 2019 C/SCA/6896/2019 JUDGMENT injurious price and around 83% of the quantities sold to other countries are at dumped prices, thereby proving beyond an iota of doubt that there is every likelihood that at these prices, if the excess capacity is diverted to India, injury to the domestic industry is imminent.
d. Producers of the subject goods in China PR have significant excess capacities. The total capacity, for producing the subject goods, of around 34 producers in China PR is around 72,70,000 MT. This is more than 3 times the capacity of the domestic industry in India and 4.6 times and 4.2 times the demand and production of the subject goods in India. If such quantities are diverted to India at the likely prices, injury to the domestic industry is imminent. The legal requirement in this regard is to only establish the likelihood or preponderance of probability that the surplus goods are likely to come into the country.
25. Respondent no.2 submits that it has given due consideration to the aforesaid submissions by the applicants in its examination of the export prices of the subject goods from China PR to third countries. In its consideration of the likelihood of continuation or recurrence of dumping and injury, Respondent no.2 arrived at the following Page 37 of 76 Downloaded on : Tue Jun 25 04:16:00 IST 2019 C/SCA/6896/2019 JUDGMENT findings.
a. Present and continued imports During the P01, the import of the subject goods was a mere 73 MT. As per the domestic industry itself, in the post-POI period, there was no "likelihood" of importation of subject goods as no Chinese producer/exporter was understood to have participated in any contract for supply of the subject goods. Thus, there was no question of increase of imports, let alone significant increase in imports.
b. Price suppression and price depression In light of the absence of imports, the respondent noted that there is no question of imports causing suppressing or depressing effect on domestic prices.
c. Surplus capacities In relation to the surplus capacity and the likelihood of its diversion to India in case of revocation of duties, the mere existence of surplus capacity does not establish the likelihood of diversion of surplus production to India to prove the likelihood of imports if anti- dumping duties were to be revoked.
26. Respondent no.2 submits that at the time of rejection of the sunset review Page 38 of 76 Downloaded on : Tue Jun 25 04:16:00 IST 2019 C/SCA/6896/2019 JUDGMENT application before initiation, the respondent no.2 in its rejection decision had made it clear that the claim of "surplus capacities" in China PR was made in isolation without provision of relevant and complete facts and data. It was made clear to the applicants that the existence of huge capacity in a particular country could not lead to an automatic presumption that such capacities are "excess"
and would be diverted to India in excess of the world demand that it catered to."
6. Same way in respect to the petitioner's contention about similarity in SSR investigation of 2013 and SSR investigation in 2018 the respondent no.2 has in its reply stated in para 35 about what were the difference between the two investigations and by explaining such facts denied the petitioner's contention in toto. The same is stated herein under after modifying para 35 to the extent that in para 35 of Affidavit in reply a table also was produced showing comparison between two investigations herein below the table is not produced but has been referred but everything else is reproduced as it is.
35. The respondent no.2 however submits that the facts and circumstances in the Page 39 of 76 Downloaded on : Tue Jun 25 04:16:00 IST 2019 C/SCA/6896/2019 JUDGMENT subject sunset review investigation when compared to that in the previous sunset review investigation are not entirely similar. There are key difference between the facts and circumstances of the previous sunset review investigation and that of the impugned sunset review investigation as elaborated below:
a. Firstly, at the time of the previous sunset review investigation, anti-dumping duties against the subject imports were in force for five years. At the time of the impugned sunset review investigation, anti-dumping duty was in force for more than 10 years. This would have greatly reduced the proclivity for exporters from China PR to export the subject goods to India.
b. Secondly, in the previous sunset review investigation, the economic parameters of the domestic industry had not improved, were weak. However, in the current sunset review investigation, the economic performance of the domestic industry had improved.
c. For ease of comparison, the respondent no.2 has reproduced the comparable economic parameters from the previous SSR investigation and the impugned SSR investigation in the table which is produced Page 40 of 76 Downloaded on : Tue Jun 25 04:16:00 IST 2019 C/SCA/6896/2019 JUDGMENT on page 368 of Affidavit in reply filed by the respondent (internal page 26 of the reply). Which may be seen to understand the difference in the economic performance in the two injury periods.
d. As can be seen from the date produced on page 368 of the Affidavit in Reply (internal page 26), in the previous sunset review, the domestic industry, was incurring losses, faced declining cash profits, low return on investment and had high levels of accumulated inventory. Contrary to the established growing profitability, stable case profits, and increasing return on investments.
e. Thus, the repeated harping of the petitioner that the respondent no.2 came to different conclusions based on identical fact is contrary to the record of the two sunset review investigations.
7. The respondent has also relied upon the following judgments.
1. 2018(359) ELT 475(DEL) Kesoram Rayon Vs. Designated Authority.
Para 71 to 89 are relied upon.
8. In view of whatever is stated hereinabove, this Hon'ble Court may dismiss Page 41 of 76 Downloaded on : Tue Jun 25 04:16:00 IST 2019 C/SCA/6896/2019 JUDGMENT the petition."
7. In support of aforesaid contentions, learned counsel for the respondents has relied upon the following judgments:
(i) In case of Jindal Poly Film Ltd. Vs. Designated Authority, reported in 2018 (362) E.L.T. 994 (Del.).
(ii) In case of Outokumpu Oyj. Vs. Union of India, reported in 2018 (36) E.L.T. 679 (Del.).
(iii) In case of Kesoram Rayon Vs. Designated Authority, reported in 2018(359) ELT 475 (DEL)
8. The Court has heard learned counsels for the parties and perused the pleadings. Before adverting to the rival contentions of learned counsels for the parties, it would be most appropriate to set out herebelow few indisputable aspects emerging therefrom, namely -
(i) This petition is in respect of the goods imports of Ductile Iron Pipes originating in or exported from China PR.
(ii) On 14.09.2007 the concerned respondents accepted the recommendations of the respondent no.2 that anti-dumping duty is required to be imposed, issued notification imposing anti-dumping duty of the subject matter for a period of 5 years;
(iii) On 07.09.2012,the respondent vide Initiation Notification No.15/1006/2012-DGAD initiated the first sunset review investigation concerning imports of the Page 42 of 76 Downloaded on : Tue Jun 25 04:16:00 IST 2019 C/SCA/6896/2019 JUDGMENT Subject Goods from the Subject Country.
(iv) On 04.09.2013, the respondent no.2 vide its final findings No.15/1006/2012-DGAD recommended continuation of anti-dumping duty for a further period of 5 years.
(v) On 10.10.2013, the respondent no. 1 vide its Custom Notification No.23/2013-Customs (ADD) continued imposition of anti-dumping duty for a further period of 5 years till 09.10.2018.
(vi) In March, 2018, the petitioner once again approached the respondents with a duly substantiated application for initiation of second sunset review investigation under Rule 23(1B) of the Rules.
(vii) The petitioner further submitted additional evidences/submissions on 14.05.2019 to prove that the cessation of the existing anti-dumping duties would lead to the continuation/recurrence of dumping and injury from the subject country.
(viii) The details of the submissions, as gathered from the written submission dated 1.2.2019, starting from page 240, deserves to be extracted herebelow :
......
"C. Likelihood of likely to lead to continuation or recurrence of dumping and injury:Page 43 of 76 Downloaded on : Tue Jun 25 04:16:00 IST 2019
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14. The Domestic Industry humbly submits that the fact that there have been no exports from China proves that the Chinese exports cannot compete with the Indian producers unless they indulge in dumping activities. However, it may be added that there is every likely hood of huge potential imports if the duties are not extended. Detailed reasons for this have already been explained in Annexure 11 of the application filed with the Authority. Briefly, we would like to submit as under:
a. Domestic Industry has procured transaction-wise import data (attached as Annexure 2) indicating exporter-wise FOB export price of DI pipes from China to other parts of the world.
b. In terms of Section 9A(5), the Domestic Industry has worked out the likely prices to India based on the FOB export prices of DI pipes from China to representative countries like Vietnam, Sri Lanka and Turkey. It is submitted that these countries are similar to India in their developmental efforts. It is also important to note that none of the selected countries has any domestic production of DI pipes and, therefore, the prices offered to these countries can reasonably be considered to be true and Page 44 of 76 Downloaded on : Tue Jun 25 04:16:00 IST 2019 C/SCA/6896/2019 JUDGMENT fair reflection of the likely prices to India. More so, the Authority may kindly appreciate that none of the Chinese producers/exporters or even the Government of China has bothered to contradict the detailed information and evidence provided by the Domestic Industry. This only proves that the information provided by the Domestic Industry is incontrovertible.
c. In addition to the price comparison with the three representative countries, the Domestic Industry has also calculated dumping margin and injury margin taking into account all export transactions from China to other countries to analyze the price attractiveness to the Indian market. Detailed calculation is attached as Annexure 2. Kindly note that only the first 15 and the last 15 entries are being submitted in the form of hard copy while the entire transaction-wise data is bring filed in the soft format. (For the sake of saving the space and repetition the table is not produced)
15. From the above, it may be note that:
(i) It may be seen from the above that if Page 45 of 76 Downloaded on : Tue Jun 25 04:16:00 IST 2019 C/SCA/6896/2019 JUDGMENT the goods start flowing into India at landed value based on export price to other countries, the Domestic Industries will certainly start suffering losses. The calculation submitted by the Domestic Industry on the basis of the actual transaction-wise data clearly reveals that more than 70% of the quantities exported from China to other countries are at a price which would support Domestic Industry's contention that the Chinese goods would land into India at a price which would have a positive injury margin.
(ii) Similarly, the calculations submitted by the Domestic Industry reveals that around 83% of the quantities sold to other countries are at dumped prices.
This proves beyond an iota of doubt that there is every likelihood that at these prices, if the excess capacity is diverted to India, injury to Domestic Industry is imminent.
16. In view of the above, it is amply clear that the dumping margin as well as the injury margin are likely to be positive without any doubt if the anti-dumping duties are not extended. In such a scenario, withdrawal of anti-dumping duties will certainly allow the manufacturers and exporters of the subject Page 46 of 76 Downloaded on : Tue Jun 25 04:16:00 IST 2019 C/SCA/6896/2019 JUDGMENT goods from China to freely dump the subject goods to the detriment of the Indian industry."
(ix) On 15.05.2018, the respondent conducted an oral hearing, whereby, the petitioner was asked to present its case and make its submissions.
(x) The respondent no.1 vide its order dated 17.05.2018 rejected the application of the petitioner for initiation of sunset review investigation concerning imports of subject goods from subject country.
(xi) Being aggrieved by the decision of respondent no. 1, the petitioner filed Special Civil Application No. 12368 of 2018 before this Court praying for a direction to the respondent no. 2 to initiate the sunset review investigation and this Court vide judgment and order dated 26.09.2018 allowed the petition and directed the respondent no. 1 to initiate sunset review investigation.
(xii) As the judgment and order dated 26.09.2018 passed in Special Civil Application No. 12368 of 2018 was not complied and the sunset review investigation was not initiated by respondent no. 2, the petitioner moved Misc. Civil Application No.1 of 2018 in Special Civil Application No. 12368 of 2018 and this Court vide order dated 08.10.2018 directed the respondent no. 2 and the Ministry of Finance to take follow up action.
(xiii) Accordingly on 09.10.2018, the respondent no. 2 vide Notification dated 7/18/2018-DGAD initiated the Page 47 of 76 Downloaded on : Tue Jun 25 04:16:00 IST 2019 C/SCA/6896/2019 JUDGMENT
second sunset review investigation.
(xiv) The respondent no. 1 has also complied with such direction and issued Customs Notification No. 51/2018- Customs (ADD) dated 9.10.2018 extending duties by only 6 months viz till 09.04.2019.
(xv) Thereafter, the respondent no. 2 conducted an oral hearing on 25.01.2019 and the petitioner was asked to present its case and make its submissions.
(xvi) On 08/09.03.2019, the respondent no. 2 visited the premises of the petitioner to conduct an on-the-spot verification of the documents and information submitted by the petitioner and issued its verification report.
(xvii) On 19.03.2019, the respondent no. 2 issued disclosure statement in terms of Rule 16 of the Anti- dumping Rules. The relevant extract therefrom deserve to be set out hereunder:
"B. Procedure :
i .......
ii .....
......
viii. The importer's questionnaire was sent tot he following known importers/users/user associations of the subject goods in India for necessary information within the prescribed time in accordance with Rule 6(4) of the Rules:Page 48 of 76 Downloaded on : Tue Jun 25 04:16:00 IST 2019
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1. Pratibha Industries Limited
2. J V Gokal & Co. Pvt. Limited
3. Gammon India Limited
4. Larsen & Toubro Limited
5. SPML India Limited ix. None of the above-mentioned importers/users/user associations or any other interested party responded tot he questionnaire or the initiation notification.
x. The investigation was carried out for the period starting from 1st January 2017 to 31st December 2017 (12 months), i.e., the period of investigation (POI). The examination of trends in the context of injury analysis covered the period 2014-15, 2015-16, 2016-17 and the POI.
xi. The Authority kept a non-confidential version of the petition and other submissions presented by various interested parties from time to time in the form of a public file maintained by the Authority and kept the same open for inspection by the interested parties as per Rule 6(7) of the Rules.
xii. Information provided by interested parties on confidential basis was examined Page 49 of 76 Downloaded on : Tue Jun 25 04:16:00 IST 2019 C/SCA/6896/2019 JUDGMENT with regard to sufficiency of the confidentiality claim. On being satisfied, the Authority has accepted the confidentiality claims, wherever warranted and such information has been considered confidential and not disclosed to other interested parties. Wherever possible, parties providing information non confidential basis were directed to provide sufficient non confidential version of the information filed on confidential basis.
xiii. Exporters, producers and other interested parties who have not responded to the Authority, nor supplied information relevant to this investigation have been treated as non-cooperating interested parties by the Authority.
C. Product Under Consideration and the Like Article Submission by the Domestic Industry
12. The following submissions have been made by the domestic industry with regard to the scope of the product under consideration (PUC) and the like article:
(i) The product under consideration for the purpose of the present investigation is the same as in the earlier investigation i.e., Ductile Iron Spun Pipes. The present Page 50 of 76 Downloaded on : Tue Jun 25 04:16:00 IST 2019 C/SCA/6896/2019 JUDGMENT investigation being a sunset review, the scope of the product under consideration has to remain the same as that in the original investigation.
(ii) There is no difference in subject goods produced by the domestic industry and the subject goods produced in and exported from China PR and they are like articles in terms of the Rule 2(b) of the Rules.
(iii) There is no material difference in the production process employed by the Chinese producers and the Indian producers of the subject goods.
Submission by other interested
parties:
13. No submission was made by other interested parties with regard to the scope of product under consideration or like article.
Examination by the Authority :
14. In the original investigation, the product under consideration was defined as under:
"The product under consideration is Page 51 of 76 Downloaded on : Tue Jun 25 04:16:00 IST 2019 C/SCA/6896/2019 JUDGMENT Ductile Iron Spun Pipe as defined under clause 3.1 and 3.2 of International Standard, ISO 2531 (for water and gas) and ISO:7186 (for sewage applications). These are often also described as Spheroidal Graphite Iron Pipes or Ductile Cast Iron Pipes or Ductile Iron Spun Pipes. These are classifiable within 73030030 and 73030090 of the Customs Tariff Act.
The various applications of DI Pipes are in:
a. Transmission of raw, portable and sea water at high pressures. b. Distribution of potable water and gas.
c. Disposal of domestic and industrial effluents.
d. Fire-fighting systems.
15. The Authority notes that this being Sunset review, the scope of the product under consideration remains unchanged. The Authority further holds that the DI pipes manufactured by the domestic industry and those produced in China PR are "like articles" in terms of Rule 2(d) of the Anti-dumping Rules.Page 52 of 76 Downloaded on : Tue Jun 25 04:16:00 IST 2019
C/SCA/6896/2019 JUDGMENT ........ Examination by the Authority
24. The Authority notes that the purpose of a sunset review is to examine as to whether there is any likelihood of continuation or recurrence of dumping or injury in the event the anti-dumping duties are revoked and for this purpose all the relevant information is to be examined.
25. The Authority notes that each relevant issue raised in the submissions of the Domestic Industry will be dealt with at appropriate places in this disclosure statement.
E. Methodology and Determination of Normal Value, Export Price & Dumping Margin Likelihood of Dumping Submission relating to Normal Value Submissions made by the Domestic Industry
26. The Domestic Industry has made the following submissions:
(i) Normal value for China PR has to be determined in terms of the provisions for non-market economy countries.Page 53 of 76 Downloaded on : Tue Jun 25 04:16:00 IST 2019
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(ii) Since no producer / exporter from China has responded to the notices issued by the Authority, Para 7 of the Annexure I of the AD Rules should be followed by the Authority for the determination of Normal Value.
Normal Value cannot be determined on the basis of price or constructed value in a market economy third country for the reason that the relevant information is not publicly available. In order to arrive at Normal Value on this basis, the Authority shall require complete and exhaustive verifiable information on all domestic sales made by a cooperating producer in such third country along with its cost of production and all other associated information and evidences (including all information in the ordinary course of trade). Principles of fair comparison as laid down under Article 2.4 of the Anti-dumping Agreement are also relevant in this respect.
27. There was no submission from other interested parties in regard to normal value.
Page 54 of 76 Downloaded on : Tue Jun 25 04:16:00 IST 2019C/SCA/6896/2019 JUDGMENT .......31. As a part of the proceedings in this investigation, the Authority had sent questionnaires to the known exporters/producers from the subject country advising them to provide information in the form and manner prescribed. There has been no response to the questionnaire nor has there been any submission by the any of the Chinese producers/exporters. In the absence of cooperation from the Chinese exporters/producers, the Authority proposes to construct the normal value on the basis of facts available.
32. The constructed normal value so proposed to be determined is as Rs.***per MT (USD***per MT).
Export Price and Dumping Margin Submissions made by the Domestic Industry Domestic Industry has submitted that based on the actual exports price of subject goods from China to Turkey, Vietnam and Sri Lanka in FOB price terms can be worked forwards to get the likely export price to India. Likely export price to India calculated by the domestic industry based on the abovementioned criterion is Page 55 of 76 Downloaded on : Tue Jun 25 04:16:00 IST 2019 C/SCA/6896/2019 JUDGMENT as under:
Unit Sri Turkey Vietna
Lanka* * m*
Quantity MT 11838 7982 28923
FOB Prices USD/M *** *** ***
T
Exchange USD/I 66.04 66.04 66.04
Rate NR
FOB Prices RS/MT *** *** ***
Commissio Rs/MT *** *** ***
n
Bank Rs/MT *** *** ***
Charges
Port Rs/MT *** *** ***
Expenses
Inland Rs/MT *** *** ***
Freight
Expenses
VAT Rs/MT *** *** ***
Credit Cost Rs/MT *** *** ***
Net Export Rs/MT *** *** ***
Price in
INR
Net Export US$/M *** *** ***
Price in T
US$
Normal Rs/MT *** *** ***
Value
Dumping Rs/MT *** *** ***
Margin
Dumping % *** *** ***
Margin
Dumping Range 45-55 56-67 55-65
Margin
Submissions by other interested
parties
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33. There was no submission from other parties in regard to export price Examination by the Authority :
34. The Authority notes that imports of subject goods from China during POI is to the tune of 73 MT at Rs.1,54000 per MT. It is further noted that the price of import is abnormal, which is established by the fact that the DI is selling the subject goods at approx. Rs.*** per MT only. It is noted that the import statistics of this item points to either misclassification of the import item or it not being the like article. However, the Authority has also calculated the export price based on the available import data. Export price has been adjusted for ocean freight, marine insurance, port expenses, commission, inland freight and indirect taxes (VAT) which may have been incurred by the exporter for exporting material to India, in order to put normal value and export price at the same level of trade. The export price to be determined is as Rs.1,19,895 per MT.
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Particulars Unit To India
Constructed Rs/MT ***
Norma Value
Ex-factory export Rs/MT 119895
price
Dumping margin Rs/MT ***
Dumping margin % ***
Dumping margin Range (75) - (65)
G. Assessment of Injury and
Examination of Casual Link
Assessment of Injury
Submissions made by the Domestic Industry
35. Domestic Industry has made following submissions:
(i) Since there have been no reliable imports of the subject goods either during the Period of Investigation or the injury investigation period, no injury analysis can possibly be made of current injury. In any case, the analysis of current injury recedes into insignificance in case of a sunset review practically when there are no imports.
(ii) Domestic Industry further submits that the mandate of the law for the Authority is only to carry out likelihood analysis as envisaged in Page 58 of 76 Downloaded on : Tue Jun 25 04:16:00 IST 2019 C/SCA/6896/2019 JUDGMENT Section 9A(5). Further, the Domestic Industry has been able to collect data of exports by the Chinese exporter to other countries during this period.
There is sufficient indication that if the export price to other countries is taken as an estimate of the likely export price to India (once the anti-
dumping duties are removed), it
would be clear that the Chinese
exports will injure the Domestic
Industry. The price undercutting as well as price underselling analysis would reveal that if the duties are not extended, the injury to the domestic industry is imminent.
Submissions made by other interested parties.
36. No other interested party has participated in the investigations and accordingly no submission been made by other interested parties.
Examination by the Authority
37. The Authority notes that there have been minisculeimports of the subject goods during the injury investigation period. The Authority notes that I the absence of reasonable quantum of import, Page 59 of 76 Downloaded on : Tue Jun 25 04:16:00 IST 2019 C/SCA/6896/2019 JUDGMENT it would be required to be examined whether there is likelihood of dumping and injury in case of revocation of anti- dumping duty. However, in view of the consistent practice, the Authority proposes to conduct injury analysis."
(xviii) Pursuant to same, the petitioner submitted its comments on 25.03.2019.
(xix) On 01.04.2019, the respondent no.2 issued the Final Findings concluding that the continuation of the existing anti-dumping duties on the subject goods are not warranted. The relevant extract from the final findings deserve to be set-out as under:
"33. It is noted that none of the Chinese export- ers/producers, except SGPL, has responded to the prescribed questionnaires nor submitted complete questionnaire responses. SGPL has submitted part information. However, the com- pany is not a major exporter of the product un- der consideration from China. In the absence of cooperation from the Chinese exporters/produ- cers, it would not be appropriate to take cogniz- ance of the part information supplied by the sole respondent, namely, SGPL. The Authority, there- fore, determines the normal value in accordance with para 7 of Annexure 1 to the Rules. ....Page 60 of 76 Downloaded on : Tue Jun 25 04:16:00 IST 2019
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36. The Authority has relied on the international prices of major raw material along with the con- sumption norms, conversion cost and SGA of the most efficient domestic producer. Profit @ 5% on the cost of production has been added to ar- rive at the constructed normal value. By adopt- ing this method, the constructed normal value is determined as US$*** per MT......
Export Price
37. The Authority notes that there are no ex- ports of the subject goods to India from the sub- ject country in the entire injury investigation period including the POI and the post POI. In the absence of exports to India by any of the Chinese exporters including the responding pro- ducer/exporter SGPL from China, the Authority has not been able to determine the ex-factory export price for the POI and the post POI peri- od.
Dumping Margin
38. Since there are no exports of the subject goods to India from the subject country in the entire injury investigation period including the POI, the Authority has not been able to determ- ine the ex-factory export price and the dumping margin for the POI and the post POI period......
Examination by the Authority
68. While the questionnaire response filed by SGPL has not been accepted by the Authority Page 61 of 76 Downloaded on : Tue Jun 25 04:16:00 IST 2019 C/SCA/6896/2019 JUDGMENT for reasons already explained above, the Author- ity has dealt with their submissions to the extent considered relevant.
69. In the present investigations, it is import- ant to note that none of the producers/exporters from the subject country, except SGPL, has filed the questionnaire response. Only SGPL, who is not a significant exporter from China even to other countries, has filed the partial response. However, since the company is not a significant exporter of the product under consideration and further since the Designated Authority is re- quired to determine likelihood of dumping and injury considering the volume of exports which were at dumped price and volume of exports which were at injurious price, individual ques- tionnaire response is of limited consequence to such an extent. The likelihood of dumping and injury is required to be determined on the basis of total exports from China to various countries globally.
70. Further, as per SGPL's own admission, they are not a major exporter of the subject goods. Therefore, the price data of SGPL cannot be considered as indicative of the likely beha- viour of other major producers, let alone a con- clusive factor. The Authority notes that the data and information of SGPL cannot be considered Page 62 of 76 Downloaded on : Tue Jun 25 04:16:00 IST 2019 C/SCA/6896/2019 JUDGMENT as representative for analyzing the likelihood analysis.
71. All other interested parties who could have given valuable information to the Authority have preferred not to cooperate with the Authority in the present investigations. The Authority notes that the relevant information from the inter- ested parties is more important in sunset review investigations where an assessment of likeli- hood is required to be made.
72. In the response submitted by the domestic industry, they have used the import data of HS international Inc (impexp.com) - Sydney, Aus- tralia to estimate the likely export price to India in view of the fact that there have been no im- ports reported to India either as per the DGCI&S data or in the import data from second- ary sources. They have submitted that export price to Saudi Arabia may be considered as the most appropriate by the Authority as China ex- ports 32% of D I Pipes to Saudi Arabia and the significance of water distribution is similar in the two countries. The Authority does not find any merit in this submission made by the Do- mestic Industry and considers exports to worlds as per the transaction wise data of HS Interna- tional Inc. (impexpl.com) - Sydney, Australia. As regards the submission of SGPL that only the Page 63 of 76 Downloaded on : Tue Jun 25 04:16:00 IST 2019 C/SCA/6896/2019 JUDGMENT weighted average price to rest of the world should be taken into consideration for the pur- pose of estimating the likely export price to In- dia, the Authority notes that even if weighted average price of exports from China to globally is above normal value, the same does not mean that dumping from China is unlikely in the event of cessation of anti dumping duty, particularly in a situation where a significant part of these ex- ports are at dumped prices and are likely to cause injury to the domestic industry. Thus, any determination made on the basis of weighted av- erage price of exports could be highly mislead- ing. The facts of the present case in fact have established that even when weighted average price of exports is above normal value, a signi- ficant portion of these exports are at dumped and injurious price. The Authority thus con- siders to take into account the average export price of dumped and injurious transactions from China to all countries (other than India).
73. The Authority considers it appropriate to take into account the average export price of dumped and injurious transactions from China to all countries (other than India) based on the transaction-wise exports data submitted by the domestic industry from HS International Inc (impexp.com) - Sydney - Australia. The Author- ity has adopted this method because in the ab-Page 64 of 76 Downloaded on : Tue Jun 25 04:16:00 IST 2019
C/SCA/6896/2019 JUDGMENT sence of actual exports to India, the Authority is determining the likely export price at which subject goods if diverted to India are likely to cause dumping and injury to the domestic in- dustry.
74. The likely ex-works export price of the ex- ports from China PR is determined by the Au- thority by making appropriate adjustments to the likely net export price on account of inland freight and insurance, commission, port ex- penses, bank charges and VAT adjustment. After making these adjustments, the likely adjusted ex-factory export price determined is as US$*** per MT.
Likely Dumping Margin during POI US$ (per MT) Normal Value *** Net Export Price *** Likely Dumping Margin *** Likely Dumping Margin% *** Likely Dumping Margin% 0-10 Range
78. On the basis of the information made avail- able by the Domestic Industry from the websites of some producers/exporters as also other reli- able websites of some other producers/export- ers, it is seen that the Chinese producers/ex-Page 65 of 76 Downloaded on : Tue Jun 25 04:16:00 IST 2019
C/SCA/6896/2019 JUDGMENT porters have ample production capacities with them. They are also exporting Ductile Iron Pipes around the world. No other interested party has either controverted the information or provided any counter-factual information. Moreover, it is noted that the interested parties have failed to give any additional factual information which they wanted the Authority to consider while de- termining the issue of excess capacities. Thus, there is ample evidence to conclude that the Chinese producers have substantial production capacities. These capacities are in themselves more than the total production capacity of the domestic industry. The importance of such huge production capacities and exports by the Chinese producers/exporters cannot be ignored.
80. Having regard to the contentions raised, in- formation provided and submissions made by the interested parties and facts available before the Authority and on the basis of above analysis including analysis of likelihood of continuation of dumping and injury, the Authority determines that:
i. The constructed Normal Value and the likely net export price to India clearly indicate the likelihood of dumping from China PR if the existing duties are allowed to be revoked.Page 66 of 76 Downloaded on : Tue Jun 25 04:16:00 IST 2019
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(ii) The likely export prices from China PR
clearly indicate the likelihood of injury to the Domestic Industry in the form of price undercutting as shown below.
Likely Under Cutting During POI
US$ (per MT)
NSR ***
Landed Value (Likely) ***
Likely Under Cutting Margin ***
Likely Under Cutting Margin ***
%
Likely Under Cutting Margin 5-15
% Range
(iii) The likely export prices from China also
clearly indicate the likelihood of injury to the Domestic Industry in the form of price under- selling as shown below.
Likely Under Selling During POI
US$ (per MT)
NIP ***
Landed Value (Likely) ***
Likely Under Selling Margin ***
Likely Under Selling Margin% ***
Likely Under Selling Margin% 0-10
Range
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(iv) Further, by taking likely prices to India from
the same data, the injury margin is also posit- ive.
(v) Based on the analysis of information on pro-
duction capacity of the subject goods of the Chinese producers/exporters; non-coopera- tion of the major Chinese producers/exporters in the investigation and the price attractive- ness of the domestic market in India, there is every likelihood that if the duties are revoked, the volume of dumped and injuries exports from China to India is likely to increase and likely to cause injury to the domestic in- dustry."
(xx) Being aggrieved by the said Final Findings of the respondent no. 1, the petitioner filed present Special Civil Application No. 6896 of 2019 and this Court vide order dated 05.04.2019 granted ex-parte order directing further extension of the anti-dumping duties by not less than one month.
(xxi) Accordingly, the respondent no. 1 vide Notification dated 10.04.2019 extended the duties by only 1 months till 09.05.2019 and thereafter, vide order dated 03.05.2019, further extended the time by 45 days and the respondent no. 1 complied with such direction and issued Customs Notification No. 18/2019-Customs (ADD) on 23.06.2019 extending duties by 45 days till 23.06.2019.
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9. The Court is called-upon to examine the rival contentions of the parties, which needs to be examined in light of the aforesaid indisputable aspects set-out hereinabove. The position of law in respect of the remedies on final findings is now clear. The decisions of Supreme Court in respect of Jindal Poly Films Ltd., Vs. Designated Authority reported in 2018 (362) E.L.T. 994 (Del.) and OUTOKUMPU OYJ Vs. Union of India (Supra) have been cited for contending that the alternative remedy in terms of Section-9C of the Act may persuade this Court in not interfering with the final findings. The judgments cited at the bar are of Delhi High Court and there cannot be any dispute to the proposition that the final finding in fact is amounting to determination or review regarding the existence, degree and effect of any dumping in relation to import of any article and hence, it may not have to await the formal order by the Central Government of accepting the same and issuing notification based thereupon. The learned counsel for the petitioner resisted the submission qua alternative remedy by inviting court's attention to the provision of Section-9C of the Act, which reads as under.
SECTION 9C. Appeal. -- (1) An appeal against the order of determination or review thereof regarding the existence, degree and effect of any subsidy or dumping in relation to import of any article shall lie to the Customs, Excise and Service Tax Appellate Tribunal constituted under section 129 of the Customs Act, 1962 (52 of 1962) (hereinafter referred to as the Appellate Tribunal).
(1A) An appeal under sub-section (1) shall be accompanied by a fee of fifteen thousand Page 69 of 76 Downloaded on : Tue Jun 25 04:16:00 IST 2019 C/SCA/6896/2019 JUDGMENT rupees.
(1B) Every application made before the Appellate Tribunal,-
(a) in an appeal under sub-section (1), for grant of stay or for rectification of mistake or for any other purpose; or
(b) for restoration of an appeal or an application, shall be accompanied by a fee of five hundred rupees.
(2) Every appeal under this section shall be filed within ninety days of the date of order under appeal :
Provided that the Appellate Tribunal may entertain any appeal after the expiry of the said period of ninety days, if it is satisfied that the appellant was prevented by sufficient cause from filing the appeal in time.
(3) The Appellate Tribunal may, after giving the parties to the appeal, an opportunity of being heard, pass such orders thereon as it thinks fit, confirming, modifying or annulling the order appealed against. (4) The provisions of sub-sections (1), (2), (5) and (6) of section 129C of the Customs Act, 1962 (52 of 1962) shall apply to the Appellate Tribunal in the discharge of its functions under this Act as they apply to it in the discharge of its functions under the Customs Act, 1962 (52 of 1962).
(5) Every appeal under sub-section (1) shall be heard by a Special Bench constituted by the President of the Appellate Tribunal for hearing such appeals and such Bench shall consist of the President and not less than two members and shall include one judicial member and one technical member.
The counsel for the petitioner contended that sub-
Page 70 of 76 Downloaded on : Tue Jun 25 04:16:00 IST 2019C/SCA/6896/2019 JUDGMENT Section-3 of Section-9C of the Act does not provide any express authority and power or jurisdiction in the tribunal to issue direction to the Union of India for issuing notification extending the anti dumping duty. In other words, sub- Section-3 of Section-9C provides that the appellate tribunal may pass such orders as it thinks fit confirming, modifying or annulling the order appealed as against in an eventuality like present where the challenge is to the final findings on sunset review which does not require any issuance of further notification, if the final findings are in negative then, the provision of Section-9C(3) does not envisaged any further positive direction to the Union of India or the Central Government for extending the anti dumping duty notification.
10. The learned counsel for the petitioner further submitted that Section-9C of the Act even if is said to be an alternative remedy, but the same cannot be an alternative remedy so efficacious as to relegate the petitioner in a given case to the tribunal. The efficacy of the remedy is required to be adjudged in the light of the circumstances of a matter. In the instant case, looking to the time factors and the authorities reluctance in issuing even the requisite notification for commencing the sunset review and the fact that the anti dumping duty extension was come to an end on 09.04.2018 and the impugned final findings were rendered on 01.04.2019 leaving only 7 to 8 days' time for availing the remedy in itself would be an indication that the appellate remedy as sought to be canvassed under Section-9C cannot be said to be efficacious remedy.
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11. This Court is of the view that the Court at this stage need not go into the aspect of the tribunal's power to issue direction to the Central Government in exercise of the power u/s.9C(3) for extending the anti dumping duty notification. The vital facts and time-line of the instant case are itself sufficient to indicate that the remedy of appeal in a present case could not have been said to be an efficacious remedy so as to give sufficient opportunity to the petitioner for seeking appropriate relief after availing the opportunity of putting forward their case. The Tribunal's jurisdiction is required to be viewed wherein there is no express indication and provision for enabling the tribunal to grant any interim relief of such nature and in light of the observation of the Supreme Court in case of Kumho Petrochemicals Company Ltd., (Supra) the hiatus created on account of non-issuance of the notification of extending anti dumping duty would be viewed as fatal and therefore, in order to provide full opportunity and for compliance with the principle of natural justice, the Court is under obligation to issue appropriate direction at times interim direction for preventing any irretrievable situation jeopardizing the entire matter without adjudication. If one looks at from this angle, then one will have no other alternative but to accept the submission of learned counsel for the petitioner that the alternative remedy of appeal u/s.9C of the Act at-least in facts of the present case cannot be said to be so efficacious as to dissuade this Court from entertaining the petition and relegating the parties to the appellate forum.
12. This brings the Court to consider the submissions on merits of the matter. It is required to be noted at this stage Page 72 of 76 Downloaded on : Tue Jun 25 04:16:00 IST 2019 C/SCA/6896/2019 JUDGMENT that the submissions canvassed on behalf of the petitioner which have been set-out herein above have hardly been refuted by the respondents. The respondents by and large have contended that the authority has observed principles of natural justice and afforded full opportunity for rendering final findings. As against this, the Court need to examine the contentions raised by the petitioner in respect of breach of principles of natural justice. The lack of opportunity for meeting with the case and the designated authority's omission in adverting to the contentions raised by the petitioner and dealing with them.
13. The annexures to the submissions clearly indicate that how and in what manner the designated authority has jumped to the conclusion without the conclusion being supported by the material on record. The Court has already set-out herein above the relevant abstracts which speaks for itself which would rather clearly indicate that the designated authority failed in dealing with the contentions and submissions raised by the petitioner. The Court is mindful of the fact that the Court need not examine the matter as if an appellate authority over the findings recorded by the designated authority but in case if the findings recorded without following the proper procedure as envisaged under Rules especially Rules-6, 7, 8, 10, 11. The petitioner's counsel has successfully demonstrated that the designated authority has failed in clearly indicating that how determination of normal value is arrived at. The likelihood of dumping and injury have not been dealt with. The surplus capacity in China has not been adverted to at all and the confidentiality though not claimed has affected the entire process. The counsel for the petitioner Page 73 of 76 Downloaded on : Tue Jun 25 04:16:00 IST 2019 C/SCA/6896/2019 JUDGMENT successfully established that the non-advertence to the requisite material placed on record and not taken into consideration the facts recorded earlier and merely changing the conclusion in final finding, has rendered the final findings untenable in eye of law as the final findings suffering from the aforesaid omissions would require to be held as perverse so as to render it unsustainable in eye of law.
14. The law in respect of the final findings and its justiciability is no more res-integra and one can say that under Article 226 of the Constitution of India when final findings are assailed on the grounds mentioned in the submissions viz. omissions on the part of the authority in considering the detail put forward by the petitioner. The omission by the designated authority in disclosing the material which is not claimed to be confidential and the omission to follow the methodology in light of the decision in respect of Rule-7 as held by Supreme Court in case of Reliance Industries Ltd., Vs. Designated Authority reported in 2006 (10) SCC 368 and Union of India Vs. Meghmani Organics Ltd., reported in 2016v (340) E.L.T. 449 can be held to be sufficient material to persuade this Court to hold that the final findings cannot be said to be sustainable in eye of law.
15. In view of the aforesaid discussions, we are of the view that the impugned Final Finding recorded in the Notification dated 01.04.2019, cannot be said to be strictly in accordance with the provision of Rule 23 of the Rules, as there is non- advertance to the material placed on record and there is non- compliance with the principle of natural justice as no requisite Page 74 of 76 Downloaded on : Tue Jun 25 04:16:00 IST 2019 C/SCA/6896/2019 JUDGMENT information was made available and the conclusions are not supported by the material on record. Therefore, we are left with no other alternative, but to remand back the matter to the concerned authority after quashing and setting aside the same for reconsideration on the aspects which have been mentioned herein above and record its finding, as the extended period of notification of anti dumping duty is ending, the same is also required to be extended for appropriate time so that assessing the material and recording the final findings afresh could be undertaken meaningfully and without jeopardizing the parties right and contentions and rendering it infructuous.
16. In that view of the matter, the respondent no.2 is hereby directed to undertake the exercise of recording its final finding afresh in accordance with the observations made herein above strictly in accordance with the provisions of Rule-23 of the Rules and after affording full opportunity to the parties and complying with the principles of natural justice and respondent no.1 shall appropriately issue notification extending the anti dumping duty on the product in question, till the final findings are rendered.
17. At this stage, it is required to be noted that as per the provisions of Section-9A(5) the extendable period of anti dumping duty is 09.10.2019. In that view of the matter, the respondent no.2 shall complete the process of rendering final findings latest by 15.09.2019 and the respondent no.1 shall extend the anti dumping duty by suitable period in accordance with the provision of Section-9A and the Rules so as to prevent the entire exercise becoming infructuous.
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18. In view of the aforesaid discussion, the impugned final findings dated 01.04.2019 are hereby quashed and set aside. The petition is allowed.
19. Shri Desai, learned counsel for the respondents makes a request for staying of the order for four weeks to approach the Supreme Court by way of S.L.P., as the Court has remanded the matter back for reconsideration and issuing fresh final finding by 15.09.2019 and as the anti dumping notification is coming to an end by 23.06.2019 night. It would not be possible for this Court to accede to the request, else the entire exercise would be in futility, hence, the Court is unable to accept the submission and the same is rejected. Direct service permitted.
(S.R.BRAHMBHATT, J.) (A. P. THAKER, J.) Pankaj/Pallav/Amar...
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