TMI Blog2010 (6) TMI 204X X X X Extracts X X X X X X X X Extracts X X X X ..... f the Central Government does not call for interference in this appeal finding the grounds of appellant pulpable. For the reasons aforesaid and conclusions drawn, the appeal is dismissed being devoid of merit. - AD/10/2007 - AD/7/2010 - Dated:- 30-6-2010 - Justice R.M.S. Khandeparkar, President, Dr. Chittaranjan Satapathy, Member (T) and Shri D.N. Panda, Member (J) REPRESENTED BY: S/Shri Jitendra Singh and Sharad Bhansali, Advocates, for the Appellant. Shri Amit Singh, Advocate and Officers of D.A., for the Respondent. [Order per: D.N. Panda, Member (J)]. - This Appeal preferred by Domestic Industries through the Appellant Association is against the result of sunset review notifying continuation of levy of Antidumping Duty at a reduced rate per MT of the Partially Oriented Yarn of any specification (hereinafter referred to as "subject goods") originated or exported from Thailand, Indonesia,. Malaysia and Chinese Taipei (hereinafter referred to as "subject countries") in terms of Notification No. 86/2007-Customs on 10.7,2007 by Respondent No. 1, i.e. Union of India represented by Ministry of Finance (Department of Revenue), Government of India. The subject goods fall ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s under Section 9A(5). Central Government does not have the power to alter the duties already in place. Since the -power to impose duties under Section 9A(1) includes the power of 're-imposition' as well, the Central Government can not alter the duty in terms of Rule 23(1) as interpreted by Hon'ble Supreme Court decision in Rishiroop Polymers case - 2006 (196) ELT 385 (SC). The Apex Court has held in the context of mid-term review that in a situation of significant change in the facts and circumstances, the Designated Authority may withdraw or modify appropriately the anti-dumping duty which has been imposed and Rule 23(1) reads as under:- "23. Review.- (1) The designated authority shall, from time to time, review the need for the continued imposition of the antidumping duty and shall, if it is satisfied on the basis of information received by it that there is no justification for the continued imposition of such duty recommended to the Central Government for its withdrawal". 2.2 According to the Appellant, if at all levy of duty is to be reviewed; the same can be done by way of an interim or mid-tern review under Rule 23(1) subject to the conditions mentioned therein. As f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r the Apex Court decision, the law on the subject is no longer res-integra. This decision was followed by the Hon'ble Delhi High Court in the case of Kalyani Steels reported in 2008 (224) ELT 47 (Delhi). The Hon'ble Court specifically dealt with the scope of Section 9A(5) as well as Rule 23 and clearly laid down that the power conferred under Section 9A(5) is guided by the mechanism of Rule 23(3). The power under Rule 23(1) is thus distinct and has to be invoked separately subject to the conditions mentioned therein. The power of Rule 23(1) cannot be drawn into Section 9A (5). 2.5. In view of the above, so far as the first issue is concerned, the Appellant submitted that the Central Government ought to have continued the duties already in place imposed vide Customs Notification No.15/2002-Cus dated 8.2.2002 as the review was carried out only in terms of the powers conferred under Section 9A(5) as there was no parallel review initiated and carried under Rule 23(1) of the Anti-dumping Rules. 2.6. As regards whether individual dumping margin can be determined for an exporter who has no exports and hence no export price to India, learned Counsel for Appellant submitted that no opti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... exporter has been determined separately on the basis of weighted average import price in India during the investigation period, by the Authority. 61. In respect of cooperating exporters viz. M/s Foshan Huanshengchang Ceramic Co Ltd (HCC) (producer) and related company Guandong Dongpen Ceramic Co Ltd (DCC) (Exporter) and Guangdong Winto Ceramic Co Ltd who had declared to have exported the subject goods to India during POI, but were actually found to have exported Ceramic Tiles and not vitrified Tiles (PUC) during verification, and had exported the subject goods to third countries, the likelihood of either continuation or recurrence of dumping cannot be determined based upon the sales to third countries. The Authority notes that in the contest of anti dumping rules, likelihood of continuance or reoccurrence is for determination of individual dumping margins and is applicable to only such exporters who have been exporting the subject goods to India. Since these exporters have not exported subject goods to India, individual dumping margins cannot be determined based upon exports to third countries. To that extent the authority holds that export price for determination of dumping mar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... port price to a third country also while such method under the rules, permit for determination of normal value. (C). The likely export price in the case was adopted by taking into account actual export prices to other countries from the subjected concerns during the Period of Investigation (PIO) as there were no exports of subject goods from M/s Polysindo to India. Once a likely price is adopted for determination of dumping and dumping margin, it follows that the same price is used for establishing likelihood of injury, including injury margin also. (D). Where there was no current/continued dumping, the Designated Authority was required to ascertain whether dumping was likely to recur in the event of revocation of anti-dumping duties. Therefore, useful parameters which received consideration in this regard are:- (a). Export price of the exporters from their country to third countries; (b). Import prices prevailing in India and using the same to determine likely export prices of the exporters in the said countries; (c). Selling prices of the domestic industry to provide basis for determination of likely export prices of the exporters of the subject countries; (d). Pre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ority to amend quantum of duty and appellant's plea that during the sun-set review no fresh determination of individual dumping margin can be done, is untenable and not supported by law. This interpretation has been upheld in the case of Indian Graphite Manufacturers Association Vs Designated Authority reported in 2006 (199) ELT 722 (T). (K). The quantum of duty is determined in the review proceeding following due process which is required to be followed for determining the definitive anti-dumping duty. Section 9A(1) of the Customs Tariff Act gives power to the Central Government for imposing anti-dumping duty not exceeding the margin of dumping. Section 9AA of the Customs Tariff Act provides that where an importer proves to the satisfaction of the Central Government that he has paid any anti-dumping duty imposed under sub-section (1) of Section 9A on any article, in excess of the actual margin of dumping in relation to such article, he shall be entitled to refund of such excess duty. Thus if Sections 9A (1) 9A (5) and 9AA are read together, the effect will be that under any review under Section 9A (5) the Designated Authority can recommend the amount of anti-dumping duty which c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... into force, in the year 1995, the 1985 rules were superseded and Customs Tariff (identification, Assessment and Collection of Anti-dumping Duty on Dumped Articles and for determination of Injury) Rules, 1995 (hereinafter called "1995 Rules") were framed to come into force on the 1st day of January 1995. 6. The principle behind Anti dumping laws is to protect the domestic industry from being adversely affected by import of goods at export prices which are below the normal value of the goods in the domestic market of the exporter. Section 9A of the Act provides that where any article is exported from any country or territory to India at less than its "normal value" [as defined by clause (c) of Explanation under section 9A (1) of the Act to mean the comparable price, in the ordinary course of trade, for the like article when meant for consumption in the exporting country] then, upon the importation of such article into India, the Central Government may, by notification in the Official Gazette, impose an anti-dumping duty not exceeding the "margin of dumping" [as defined by clause (a) of Explanation under section 9A (1) of the Act to mean the difference between the "export price" and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... price in the domestic market. The broad principles on which the determination of normal value, export price and margin of dumping and injury are done is indicated in Annexure I and II respectively to the 1995 Rules. Designated authority investigates as to the existence, degree and effect of any alleged dumping in relation to any import of any article and also to identify the article liable for anti dumping duty. That authority is also empowered to recommend to the Central Government as regards normal value, export price, margin of dumping and also give its findings on injury or threat of injury to the domestic industry. The date on which the duty is to be commenced is also to be recommended by the designated authority. Such authority is also further empowered to review the need for continuance of any anti-dumping duty. In terms of Rule 11 of the 1995 Rules framed under Sections 9A (6) and 9B (2), recording of a finding on material injury is sine Qua non for imposition of the duty. Sub-rule (2) of Rule 11 provides that the Designated Authority shall determine the injury to domestic industry, threat of injury to domestic industry, material retardation to establishment of domestic ind ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tatis mutandis applicable in the case of review. For the purpose of ascertaining whether there is justification for continued imposition of anti-dumping duty, all relevant information is asked for from the domestic industry. Taking all the 14 parameters given in para (IV) of Annexure-II relating to principles of determination of injury that is required to be determined in a review of exercise since review is off spring of the original exercise of levy of antidumping duty itself and all developments subsequent to original levy invite attention for review. The exercise in review is neither mechanical nor casual but methodical and procedural being arising under law like original exercise. Review may call for varying or vacating the original levy depending on the facts and circumstances of each case. 12. Consequent upon coming up of any new material or change in economic factors, the Designated Authority is empowered to test such materials or factors on the basis of parameters enumerated in Para (IV) of Annexure-II to the 1995 Rules like such process followed at the initial stage of imposition of anti-dumping duty. The D.A. is not prohibited by express letters of law by any implicati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tricted amplitude and extent, when compared to that of the Central government notifying the levy under the Customs Tariff Act, 1975. Consequently, law impliedly grants the power of doing all such acts or employing such means as are essentially necessary to its effective exercise and that the statutory conferment of the investigation power carries with it the duty and obligation as well, in proper cases to make recommendation for reduction/variation of antidumping duty or vacation thereof, imposed earlier. Any thing not expressly barred by law, by no stretch of imagination can be construed to be otherwise. A Public Authority is invested with power to do public good. Therefore nothing can be presumed to be against a public authority unless the authority-acted malafide. 15. The Apex court in Income-tax officer v. M.K. Mohammed Kunhi - 71 ITR 815 (SC) held that "It is a firmly established rule that an express grant of statutory power carries with it by necessary implication the authority to use all reasonable means to make such grant effective (Sutherland's Statutory Construction, third edition, articles 5401 and 5402), The powers which have been conferred on the D. A. with widest po ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cial constables, and gave them jurisdiction to inquire into an offence, impliedly empowered them to apprehend the persons who unlawfully failed to attend before them for those purposes. Otherwise, the jurisdiction could not be effectually exercised." 17. The DA being an Investigating Agency at the grass root level to protect interest of the domestic industry it has all those incidental and ancillary powers to enquire and examine extent of injury to domestic industries by imports calling for levy of extent of anti dumping duty in the fitness of the circumstances and such power is necessary to make fully effective the express grant of statutory powers. Certain powers are recognised as incidental and ancillary, not because they are inherent with an Authority, nor because its jurisdiction is plenary, but because it is the legislative intent that the power which is expressly granted in the assigned field of jurisdiction is efficaciously and meaningfully exercised. The powers of the DA are no doubt limited. Its area of jurisdiction is clearly defined. But, within the bounds of its jurisdiction, it has all the powers expressly and impliedly granted. The implied grant is, of course, limi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... le for weaving or knitting into fabrics. (D). Various interested parties required PIO should be 12 months within the Financial year: 2004-05 but not 15 months period. The issue was examined and according to the established practice to consider the period of investigation as latest as possible, the Authority decided to take POI of 15 months in this case to keep the POI as close to the initiation as possible and in any case not later than 6 months from the date of POI and also taking into account easier availability of the information. (E). So far as the aspect of competition between the imported products and the like domestic product is concerned, the Authority noted that; (1). The subject goods were imported from the subject countries under the same tariff classifications; (2). The imported subject goods were commercial and technical substitutes of the domestically produced POY; (3). The subject goods were imported by the end users and other importers and the goods entered the commerce of the country through similar channels; (4). There had been no decline in the selling price of the domestic industry during the injury period. Therefore, no price depression was caused ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... jury to the domestic industry and also to domestic industry as a whole. However, the domestic industry has suffered significantly on account of the price effects as the price undercutting which was negative during the base year became positive and significant during the POI. The landed prices of the dumped subject goods from the subject country showed a consistent decline in spite of the increase in the cost of production of the domestic industry indicating price suppression. It was also noted that the profitability of the domestic industry for product under consideration became negative during the period of investigation and the return on investment and cash flows were adversely affected and declined to a meager level in the period of investigation. The dumping margin from the subject country was considered significant. Accordingly it was found by the DA that the domestic industry has suffered material injury as envisaged by the Rules of injury determination. Mo other factor, other than the dumped imports from subject country, was brought to the notice of the Authority to show any injurious impact thereof. (I). Submission of the domestic industry made before the DA stating that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... inuation of dumping and injury. 18.3 The consequence of recommendation of DA was that landed value of import was the assessable value under the provisions of Customs Act, 1962 and definitive anti-dumping duty equal to the amount indicated in Column 9 of the Table appearing under the impugned Notification became payable on all imports of POY falling under chapter 54 of Custom Tariff Act, 1975, originating in or exported from subject countries. The Union of India, which is the Respondent in the present appeal, issued the impugned Notification. 19. Entire argument of Designated Authority appears to be logical and based on sound principles of law. There appears no exercise of power arbitrarily by the Central Government in varying the quantum of anti dumping duty leviable in consequence of sunset review and accepting the recommendation of D.A. in that regard. In this appeal no exporter is a party. Every care appears to have been exercised by the Authority to examine extent of injury warranting appropriate quantum levy of duty without being levied arbitrarily or under bias or caprice. The appellant failing to sharply point out how reduction of duty was detrimental to the interest of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l) held in para 13, 14, 15 and 16 in following terms: 13. Unlike original investigations, sunset reviews are prospective in nature, as they focus on the likelihood of the continuation or recurrence of dumping and injury, In case antidumping duties are removed. With respect to the question whether dumping is likely to occur in the event that the antidumping duties are removed, the D.A. has to consider relevant economic facts which might indicate that in the event the anti-dumping duty is removed, dumping will recur. With respect to the injury determination, if the antidumping duty has had the desired effect, the condition of the domestic industry would be expected to have improved during the period the anti-dumping duty was in effect. Therefore, the assessment whether injury will continue, or recur, would entail a counter-factual analysis of future events, based on projected levels of dumped imports, prices, and impact on domestic producers. Thus the D.A. has to address the question as to whether the domestic industry is likely to be materially injured again, if duties are lifted. 14. Sunset review entails a likelihood determination in which present levels of dumping is obviousl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... minates (P) LTD. - 1990 (49) E.L.T. 322 (SC) = (2002-TIOL-48-SC-CUS), the Honourable Supreme Court has guoted from Maxwell on Interpretation of Statutes, (eleventh edition) to the effect that 'where an Act confers a jurisdiction, it impliedly also grants the power of doing all such acts, or employing such means, as are essentially necessary to its execution'. [emphasis supplied] 17. Aforesaid discussions throws light that Past trend and behavior of export of the subject goods to India and 14 economic parameters and guide lines of para (iv) of Annexure II to the 1995 Rules enable the D.A. to determine the likely injury to prescribe preventive duty measure against dumping likely to lead to continuation or recurrence of dumping and injury even in absence of export during the period of review. Due care appears to have been exercised by the Authority to examine extent of likely injury even in absence of export by the exporter during the Period of Investigation. Data relating to export to third countries and cost factor as well as pricing of the goods produced by domestic industries enabled the D. A, to arrive at the likely injury and extent thereof in case there shall be continuation ..... X X X X Extracts X X X X X X X X Extracts X X X X
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