Dsm Idemitsu Limited vs Designated Authority on 9 February, 2000

[Cites 0, Cited by 3]

Customs, Excise and Gold Tribunal - Delhi

Dsm Idemitsu Limited vs Designated Authority on 9 February, 2000

Equivalent citations: 2000(119)ELT308(TRI-DEL)

ORDER
 

 G.A. Brahma Deva, Member (J)

1. These two appeals are directed against the final findings of the Designated Authority published in the Ministry of Commerce Notification dated 14-5-1999 in the anti-dumping investigation concerning imports of EPDM from Japan. Appeal No. C/267/99-AD is filed by an Exporter DSM Idemitsu Limited, Japan. Appeal No. C/22/2000-AD is filed by M/s. Herdillia Unimers Limited (Domestic Industry).

2. Appeal No. C/22/2000-AD.

There is a delay of 167 days in filing the appeal. On going through the point raised in the grounds of appeal as well as reasons given in the application to condone delay, we are inclined to admit the appeal and, accordingly, delay is condoned.

3. Appeal No. C/267/99-AD.

There is a delay of one day in filing the appeal. Delay is condoned and appeal was taken up for hearing to decide the issues on merits.

4. By impugned order, the Designated Authority recommends imposition of definitive Anti-dumping duties on all imports of EPDM falling under Chapter 40 originating in or exported from Japan, excluding Poly Butadiene Rubber (PBR) falling under sub-heading 4002.70.01. The anti dumping duty shall be the difference between the amounts mentions in column 3 below and the landed value of imports Per MT.

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S.No. Name of Company Amount (Rs./pmt)

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1. M/s JSR 100644

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2. M/s DSM 104725

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3. Any Other Exporter 104725

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5. The product under consideration in the present case is Ethylene Propylene Diene Rubber (EPDM). EPDM Rubber is a synthetic polymer of ethylene, propylene and diene. As analysed by the Designated Authority in the order, EPDM is produced by solution polymerization. EPDM provide better ozone and thermal resistance and is mainly used in automotive applications such as profiles, radiators, hoses and seals; in building and construction as profiles, roofing foils and seals; in cable and wire as cable insulation and jacketing and in applications as a wide variety of mostly in moulded article.

6. Learned counsel, appearing for the appellants, submitted that article manufactured by the domestic manufacturer is different from the article exported into India relying upon the information furnished by one of the Importers. He contended that Designated Authority erred in treating the 'like article' without taking into consideration of the quality difference in between the article manufactured by the Domestic Industry and the article exported into India. The plea of the appellants' counsel is not convincing since he did not adduce any evidence/technical literature with reference to process of manufacture to show that product manufactured by the domestic manufacturers was different from the goods exported into India. He failed to substantiate that they are not similar and interchangeable except stating that they were of different grades. Difference in quality will not make an article as different and Designated Authority was right in observing 'that the fact that qualities may be different, does not imply that the imported product and the domestic are not like articles'. We do not find any valid reason to disturb the findings given by the Designated Authority on this issue.

7. Learned counsel further submits that neither he is questioning the normal value nor dumping margin as determined by the Designated Authority, but no injury has been caused to domestic Industry due to imports from Japan. He said mat M/s. Herdillia Unimers Limited (HUL) was the only domestic Industry manufacturing EPDM and it could not meet the requirements of domestic market. He said that in spite of this, margin of loss has declined in the period of investigation compared to previous years as can be seen from the balance sheet and its production, sales and capacity utilization has increased from year to year. Therefore, loss or injury; if any, suffered by the domestic Industry, cannot be attributed to imports from Japan; but are due to other factors. Domestic Industry could not capture the market as expected, due to its poor quality and excess capacity of its project.

8. Learned counsel, appearing for the Domestic Industry, pointed out that M/s. HUL started its production on 1-4-1993 and it could not achieve its estimated annual production of 10,000 MT due to dumped imports from Japan at a lower price. He said that period of investigation is 1-4-96 to 30-9-97 (i.e., period of 18 months) and Domestic Industry could produce 21%, 36% and 32% for the 1st year, 2nd year and the period of investigation respectively. He submitted that not only there is a quantum jump in imports from Japan year to year but goods were dumped at low price while other exporting countries increased their export prices of EPDM substantially.

9. Learned counsel, appearing for the Designated Authority, submitted that rightly the appellants have not challenged the invoice value since they did not co-operate with the Designated Authority in furnishing the data with reference to cost of production, D.A. had no alternative but to determine the invoice value based upon the best information available particularly taking into consideration the domestic selling price of other Exporter viz. M/s. JSR against whom duty has also been imposed. But no appeal has been filed by M/s. JSR. As regards injury, he submitted that D.A. has not determined injury on the basis of any single factor but on several factors, production, capacity utilization, sales quantities, average sales realization, stock, financial losses and all these factors collectively and cumulatively establish that the domestic Industry has suffered injury. He justified the findings in determining the dumping margin and injury margin to impose anti-dumping duty based upon material available on record.

10. Dumping; Material injury, and causal link are the important factors to determine anti-dumping duty. The appellants have not questioned findings of the D.A. with reference to dumping margin. It necessarily follows that exporters have dumped EPDM into India. We are left with the only question whether any injury has been caused to the domestic Industry or not due to dumped imports from Japan. Admittedly, quantum of imports from Japan has increased yearwise and details of imports of EPDM Rubber into India from 1992-93 to 1996-97 are as follows:-

FIN. YEAR.    IMPORTS   FROM   OTHER  IMPORT FROM JAPAN 
              COUNTRIES

11. As can be seen from the record not only its market share has been increased substantially but goods were dumped into India at low price compared to other countries. For instance, during 1996-97 Japanese price was Rs. 50 per Kg. as against Rs. 68 per Kg. of other exporting countries. It was submitted on behalf of the appellants that Domestic Industry was not in a position to meet the market requirements and hence, Japan came to the rescue of needy consumers in supplying the requisite material. If the exporters wanted to supply the goods to meet the requirement in Indian market that could be done by exporting the requirements at a price equivalent to normal value but not at a dumped value and to capture the market, as it was rightly pointed out by the counsel for the Designated Authority. On going through the worksheet of the Authority and the confidential information placed before us, we find that fair selling price of EPDM was determined at optimum level of capacity utilization for the period of investigation. The D.A. has clearly brought out that Domestic Industry has suffered material injury and it was compelled to sell the goods at prices below the cost of production. Balance sheets for the relevant years also substantiate this position that right from the start of commercial production, the unremunerative pricing has led to losses every year. It has not been able to charge a fair selling price which permits recovery of full cost of production and earn a reasonable profit and even it could not attain the estimated target due to dumped imports from Japan.

12. Since dumping, material injury to domestic Industry and the causal link between them have been established, we do not find any flaw in the findings of the Designated Authority. Accordingly appellants fail on all the issues.

13. The learned counsel, appearing for the domestic Industry (Appeal No. C/22/2000-AD) pointed out that amount of duty has been fixed in rupee term and it should be imposed in dollar terms as it was done in the earlier cases. Following the previous ruling, we hold that anti-dumping duty should be imposed in terms of dollar. Accordingly, on conversion, table in the final findings of the Designated Authority is modified as under:

14. But for the above modification, the order passed by the Designated Authority is otherwise upheld and, accordingly, appeals are disposed of in the above terms.

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Customs, Excise and Gold Tribunal - Delhi

Dsm Idemitsu Limited vs Designated Authority on 9 February, 2000

Equivalent citations: 2000(119)ELT308(TRI-DEL)