TMI Blog2017 (9) TMI 67X X X X Extracts X X X X X X X X Extracts X X X X ..... ve of 3.0 specification, also requires consideration - we find no merit in the objections raised by the appellants regarding treatment of scope of products under consideration by the DA. Principles of Natural Justice - inconsistency in import data - Held that: - the DA did act with deligence while collaborating the data during the course of analyzing the parameters for the need to impose ADD on the subject goods. We also note that many meetings have been held by the DA with interested parties and the aspects of import data have been disclosed and discussed. This is not being denied by any interested party. However, the dispute is relating to disclosure of complete transactionwise details. We find such disclosure is governed by the confidentiality condition put in by the DGCIS. We find the non-disclosure of individual transaction details by itself did not vitiate the proceedings of the DA and adversely affected the interest of the appellants - We find no merit in the points raised by the appellants regarding inconsistency in import data and also violation of principles of natural justice. It is noted that import of subject goods from third countries are negligible and could no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d to explain the background for the intervening period, before filing these appeals. The applicants submitted that one of them (SDI) had filed a writ-petition No.744/2015 challenging the final finding of the DA. The Hon ble Delhi High Court vide their order dated 18/03/2015 quashed the said final finding. The DA and the Domestic Industry (DI) filed SLPs before the Hon ble Supreme Court. The Hon ble Supreme court vide their order dated 16/02/2017 set aside the order of the Hon ble Delhi High Court. The Apex court gave the option to the aggrieved parties to challenge the final notification dated 22/05/2015 before the appellate Tribunal under Section 9C of the Customs Tariff Act, 1975. The applicants filed these appeals on 12/05/2017. The applicants submitted that as the final finding of the DA was set aside by the Hon ble Delhi High Court and was brought into legal existence again by the order dated 16/02/2017 of the Apex court, it is prayed that the time limit to file the present appeals is to be reckoned from that date only. 3. On perusal of the applications and after hearing all the interested parties, we note that in view of the facts and chronology of the events, as narrated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was placed on the decision of Apex court in Union of India Vs. Meghmani Organics Ltd. and ors. reported in (2016) 10 SCC 28 . The data analysis by the DA contained wide variety of products and the classification of these products were also made under different tariff headings. In such situation, it is important for the DA to disclose the methodology in refining the data and arriving at the volume of import. In view of import statistics being not correctly collected and examined, the entire injury analysis price undercutting/underselling analysis are tainted and are unreliable. This will seriously undermine the causal link analysis and ultimate recommendation. (d) DI admitted to being an importer of Chip on Board (COB) based flash drive and, as such, the DI has no standing under Rule 2 (B) of the AD Rules. (e) the appellants were cooperating during the investigation by the DA and filed all the responses. Denial of nil rate of duty for the appellants is not justified. (f) Reliance was also placed on various decided cases to support the above submissions of the appellants. 6. The learned Counsel for the DI raised a preliminary objection on the locus-standi o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at there is a case for investigation concerning import of subject goods. At the stage of prima facie satisfaction, the full accuracy of data is not subjected to thorough scrutiny. However, during the course of investigation, the data submitted by the applicants are verified and the DA also obtained data from DGCIS who is maintaining official data of import of various commodities into India. Regarding non-disclosure of transaction level data to the interested parties, the learned Counsel for the DA categorically stated that even for answering parliament questions DGCIS does not provide transaction level data due to commercial confidentiality. He further submitted that the transaction level data was provided for dumping investigation. It is the submission of the learned Counsel that the transaction level data cannot be made public in view of commercial confidentiality. However, the relevant non-confidential data which formed the basis of investigation and finding are always revealed to the interested appellants during disclosure and the comments were obtained. There is no violation of principles of natural justice in such procedure. He also reported that none of these appellants ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of these appellants were part of the findings by the DA. The position of the appellants were examined in connection with determination of normal price, injury margin and other analysis made by the DA. He held that the data provided by appellant in Ireland cannot be taken for considering of normal price etc. as Ireland is not a subject country of investigation. Regarding the status of appellants in China it was observed that SDSS who physically exported the product to India do not have any legal right over the product concerned. SDM, Ireland declared the factory address of SDSS in China. SDM Ireland have toll processing contract with SDSS China and have technology service agreement with Sandisk Information (Technology) Shanghai Company Ltd.; for R D services and distribution agreement with SDI Ireland and others. SDM Ireland sells products in India through SDI Ireland. The export to India move directly from SDSS and the invoicing is done by SDM, Ireland in favour of SDI, Ireland who in turn issue invoice of subject goods to the Indian importers. The DA concluded that SDM Ireland owns the subject goods through out the production process, passes the legal title over the subject goods ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion. The advancement in technology and the possibility of inter-changeable use and threat to USB flash drive of 3.0 specification, also requires consideration. This aspect has been examined at length by the DA and he recorded the following findings :- 12. The various submissions made by the interested parties with regard to the scope of PUC and domestic like article and considered relevant by the Authority are examined and addressed as follows; i. As regards the contention that the scope of the PUC defined in the present investigation is too wide and not appropriate, the Authority notes that the PUC in the present investigation i.e. USB Flash drives has been defined comprehensively and appropriately keeping in mind the technicality and functionality of the product. A USB flash drive is a data storage device that includes flash memory with an integrated Universal Serial Bus (USB) interface. USB flash drives are typically removable and rewritable data storage devices with different capacities. A USB flash drive consists of a small printed circuit board carrying circuit element and a USB connector insulated electrically and protected inside a plastic, metal, or rubberized ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2.0 and 3.0 products as the price difference between 2.0 and 3.0 products is not significant. On the basis of relied upon imports data, the Authority notes that during the POI the import price of USB Flash Drives of 3.0 port and 2.0 port per piece is US$ *** and US$ *** respectively. Nonetheless, in a situation of dumping, the cost and price does not matter much. What matters is whether both the varieties of USBs are technically and functionally substitutable and whether one is capable of replacing the other in the market. If yes, then imposition of anti-dumping measures on the imports of one variety does not give the desired result since the other one being kept out of the purview of the anti-dumping measures can flood the market to the detriment of the domestic industry. v. As regards the contention that UFDs supporting USB 3.0 ports have higher power saving capabilities and offer higher transfer speeds than those supporting USB 2.0 ports and therefore falls beyond the scope of the PUC, the Authority notes that power efficiency and functional speed may make USB 3.0 ports more efficient than UFDs supporting USB 2.0.ports, but do not make them different. vi. It is a wel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rity notes that the import data relied upon in the present investigation reported imports of COB based flash drives from the subject countries during the POI. The Authority further notes that COB or Chip on Board based flash drives for short is a type of flash memory that looks very similar to other types of flash drives. What makes COB based flash drives different than a traditional flash drive for example is that instead of having the controller chip and flash memory chip separate, on a COB based flash drive both the controller and the flash memory are built together. xi. As regards the contention that if COB is considered as a part of the PUC, Mosar Baer should not be considered to be a part of the domestic industry on account of it admittedly importing COB, the Authority notes the clarification given by Mosar Baer that they have imported the components for manufacturing of COB flash drives. Therefore, the imports of components by Mosar Baer do not affect the standing of the company as domestic industry under the Rules. xii. As regards the contention that the import statistics provided by the domestic industry was revised and later withdrawn, the Authority notes that altho ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... significantly with changes in storage capacity and therefore they cannot be considered as alike, the Authority notes that the cost and price difference between capacity to capacity USBs is reasonable. Considering the functional substitutability, keeping aside some capacity USBs out of the purview of anti-dumping measures would encourage the exporters to dump the same and replace the domestic industry s products in the market. xix. As regards the contention that a consumer requiring a UFD of 128 GB for large data storage will not opt for UFDs of storage capacity 32 GB, the Authority notes that nothing prevents the consumer to store the required data in more than one UFD. a. As regards the contention that UFDs of higher storage capacities differ significantly from UFDs of smaller capacities based on the raw material used, costs, prices, function and uses, the Authority notes that considering the functional substitutability of the products, keeping certain categories of UFDs out of the purview of anti-dumping measures would enable continued dumping of the same and replace the domestic industry s products in the market. b. As regards the contention that product type ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and there were huge inconsistencies in this data indicating the volume of import as projected by the DI during the investigation is totally unreliable. We note that the DA had examined this issue. It is apparent that the DI submitted different sets of import data before the DA. This aspect was examined by the DA. He recorded that import data from DGCIS has been relied upon in the present investigation. As already noted that transaction level data could not be made available to the interested parties due to commercial confidentiality. Examining the application of Rule 7 of AD Rules, the DA recorded his conclusion regarding disclosure of nonconfidential version of questionnaire responses. During the course of arguments, the learned Counsel for DA had submitted to the Bench, confidential data analysis made by the DA. We note that the DA had examined the DGCIS data with private CYBEX data submitted by the interested parties. On perusal of such examination, we are satisfied that the DA did act with deligence while collaborating the data during the course of analyzing the parameters for the need to impose ADD on the subject goods. We also note that many meetings have been held by the DA ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... No. of the importers, Bill of Entry No. of the importers, Port of import, date of import, etc. In terms of Rule 6(7) of Anti-dumping Rules, The designated authority shall make available the evidence presented to it by one interested party to the other interested parties, participating in the investigation, and in terms of the said provisions, the non-confidential information presented to it by the interested parties participating in the present investigation have been made available in the public file maintained by the Authority. DGCI S provides the transaction level imports data to the DGAD for anti-dumping investigations only. Designated Authority is not authorized to make available the said transaction-by-transaction import statistics to the interested parties. In view of the above, the transactionwise imports data obtained from DGCI S and relied upon by the Authority in the present investigation is not made available to the interested parties . 16. We find no merit in the points raised by the appellants regarding inconsistency in import data and also violation of principles of natural justice. 17. The appellants contested the injury analysis price under cutting/under ..... X X X X Extracts X X X X X X X X Extracts X X X X
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