TMI Blog2023 (6) TMI 15X X X X Extracts X X X X X X X X Extracts X X X X ..... as only on a trial basis that this product was supplied to the appellant which also could not meet the technical requirements. The designated authority, therefore, committed an error in observing that Hindalco had supplied lithograde aluminium coils beyond 1150 mm and up to 1600 mm to the appellant when only miniscule supply had been made. In such a situation when commercial production had not been undertaken by Hindalco of this product, the issue of demand-supply gap would not arise. At its plant, the appellant subjects the lithographic coils to the electro-chemical graining process for conversion into offset printing plates. Electro-chemical graining is a process by which the surface of the coil is evenly roughened to improve the adhesion of the coating layer to the coils which improves the water/ink balance of the printing by the printers through exposure and developing. Technically the electro graining can only be done in the direction in which the coil has been rolled by Hindalco. After undergoing graining, the coils then undergo, inter-alia, the processes of anodizing and coating to become lithographic plates. When the manufactured plates are installed into the printi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Ms. Reena Asthana Khair and Ms. Shreya Dahiya, Advocates for Respondent No.15 Shri Devesh Tripathi, Shri Rajesh Sharma, Ms. Roopali Sharma and Shri Nikhil Sharma, Advocates for Respondent No.10 17 Shri Ameet Singh and Ms. Bhawna, Advocates for Designated Authority Shri Viswajeet Saharan, Authorised Representative for the Central Government ORDER Technova Imaging Systems Private Limited [the appellant] has filed this appeal to assail the final findings dated 07.09.202 issued by the designated authority and the consequential customs notification dated 06.12.2021 issued by the Central Government imposing anti-dumping duty on certain flat rolled products of aluminium [the subject goods] from China PR. The second relief that has been claimed is to grant exclusion to higher width Lithograde Aluminium coils above 1150 mm width , which are not commercially manufactured and supplied by the domestic industry i.e., Hindalco Industries Ltd. [Hindalco] 2. During the hearing of the appeal, Shri V. Lakshmikumaran, learned counsel for the appellant assisted by Shri Devinder Bagia, Shri Ankur Sharma, Shri Jayant Raghu Ram and Shri Ashutosh Arvind Kumar, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d, and the margin is positive and significant. b) The domestic industry has suffered material injury and the injury margin is positive. The examination of the imports of the subject product and the performance of the domestic industry shows that the volume of dumped imports from the subject country has increased in both absolute and relative terms. The volume of the subject goods has increased by more than 60% whereas demand has increased by only 18%. It is also noted that the imports of the subject goods from the subject country are suppressing the prices of the domestic industry. The production and the sales of the domestic industry have remained largely stable in the period of investigation while the capacity utilization remains suboptimal. It is noted that the market share of domestic industry has declined by 12% in the period of investigation whereas market share of the imports from the subject country has increased by 35%. The performance of the domestic industry has significantly deteriorated in respect of profits, cash profits and return on capital employed. The domestic industry has suffered financial losses, cash losses and negative return on investments in the period ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s used in the printing industry for transferring data as an image onto paper or on non-absorbent substrates like tin sheets or poly films. The use of Aluminium offset printing plates in the printing process enables the digital workflow to directly transfer the image from a computer to the plate' using lasers, unlike the analog workflow that requires an intermediary film to transfer the image. Aluminium offset printing plates are manufactured from high purity lithograde aluminium coils, which is the principal raw material for its manufacture. The appellant is the sole manufacturer of Aluminium offset printing plates in India and, accordingly, is also the sole user of lithograde aluminium coils in India. Hindalco is the only Indian manufacturer of certain lithograde aluminium coils. The appellant claims that it buys the entire production of Hindalco of lower width lithograde aluminium coils but even at full capacity, Hindalco is unable to fulfil the demand of the appellant for lithograde aluminium coils below 1150 mm as during the period of investigation, the appellant had a demand more than 16,000 MT of lower width lithograde aluminium coils, out of which only around 10,000 MT w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... coils having width above 1150mm in the past to customers. Further, the quality of products provided by the petitioner meets all the specified requirements. xii. No industry or manufacturer can supply products meeting all specifications at all times. Depending upon the industry and product in question, there will be some products in a batch or over multiple batches that may not meet all specifications. In such cases, those products are returned and amounts for the same are adjusted for future orders or refunded. This in itself cannot be a ground for exclusion. 10. The submissions made by the other interested parties on the product under consideration are as follows: C.2 Submissions made by the other interested parties 6. The following are the submission made by the other interested parties with regard to the product under consideration and like article: a to c ***** d. Exclusion requests : Following exclusions have been requested by the opposing interested parties: ***** i to xv ***** Lithograde Aluminium Cois above 1150 mm width xvi. Aluminium offset printing plates are manufactured from high purity litho-grade aluminium coils which is the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and, the domestic industry has submitted that it has supplied coils having width above 1150 mm in the past to customers meeting all the specified requirements. 26. The Authority has verified the evidence submitted by the domestic industry and finds that the domestic industry has supplied Lithograde Aluminium coils beyond 1150 mm and up to 1600 mm width to one of the parties. Accordingly, this is included within the scope of the PUC. 27. The Authority notes that a possible demand-supply gap does not justify the exclusion of particular product types where they are comparable to the product under consideration in terms of characteristics such as physical chemical characteristics, functions uses, product specifications, distribution marketing and tariff classification of the goods. 28. Interested parties have argued that the supply of these coils by domestic industry had been on a trial basis out of which many of them failed to produce the desired quality standards required and were liable to be rejected. 29. The Authority notes that if the government has prescribed certain standards of a product and the product supplied by the domestic industry conforms to such stand ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assisted by Shri Atul Sharma and Shri Darpan Bhuyan, learned counsel appearing for Hindalco made the following submissions: (i) Higher width lithograde aluminium coils above 1150 mm are manufactured by the domestic industry. The designated authority had also verified that the domestic industry has produced and supplied higher width lithograde aluminium coils above 1150 mm; (ii) As the appellant purchases the entire quantity of lithograde aluminium coils produced by the domestic industry it would mean that the domestic industry produces lithograde aluminium coils equivalent to the orders received by it from the appellant. This is for the reason that the appellant is the sole buyer and the user of lithograde aluminium coils; (iii) The cheap dumped imports of lithograde aluminium coils from China PR have cannibalized the potential sales that can be realized by the domestic industry from the appellant which is the sole customer; (iv) If certain grades of the product under consideration are exempted on the basis that they cannot cater to the entire demand/requirement of that particular grade in India and cheap dumped imports at unfair prices are allowed to continue a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... period of investigation. However, most of such higher width coils supplied by Hindalco could not meet the technical requirements of the appellant and they were returned to Hindalco. It is for this reason that the appellant claims that it has to import lithograde aluminium coils above 1150 mm. 20. It is not denied by Hindalco that only 2% of the total demand of lithograde aluminium coils above 1150 mm were supplied to the appellant and nor has it been denied that 25% of such trial quantity were rejected by the appellant. In the final findings, the designated authority placed reliance on few invoices of supply of lithograde aluminium coils above 1150 mm by Hindalco and held that the possible demand-supply gap would not justify the exclusion of this product from imposition of anti-dumping duty. 21. The issue of demand-supply gap would arise only if Hindalco was commercially producing and supplying lithograde aluminium coils above 1150 mm. This demand as supply gap may make sense for lithograde aluminium coils below 1150 mm because Hindalco was commercially producing the same even though it could not meet the entire demand of the appellant. 22. It needs to be noted that the Ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... m met the requirements. 24. It is, therefore, clear that Hindalco does not produce lithograde aluminium coils above 1150 mm on a commercial basis and it was only on a trial basis that this product was supplied to the appellant which also could not meet the technical requirements. The designated authority, therefore, committed an error in observing that Hindalco had supplied lithograde aluminium coils beyond 1150 mm and up to 1600 mm to the appellant when only miniscule supply had been made. In such a situation when commercial production had not been undertaken by Hindalco of this product, the issue of demand-supply gap would not arise. 25. The designated authority also noted that Hindalco is manufacturing lithograde aluminium coil as per the applicable BIS Standards and thus, the issue of failing the testing requirements cannot be raised by the appellant. The designated authority has not made any specific reference to the BIS Standard that the product satisfies and neither the learned counsel for the Hindalco placed any particular standard, particularly when learned counsel for the appellant had specifically stated that there are no BIS Standard covering this product. 26. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The web is anodized (a layer of Aluminium oxide is formed) by electrolysis process. Rinse 4 The coil is washed by multiple sprays of water to remove the entire residual chemical from previous Post Treatment The coil is thoroughly cleaned in this tank under mild acidic conditions. Rinse 5 The coil is washed for the removal of residual chemical film using water sprays. Drying The coil is dried completely before it is coated. Coating Heat sensitive coating is done in a dust free environment taking cognisance of all process application requirements. Drying The coating is dried in this section. Baking Baking process ensures that web dries effectively and makes coil ready for cooling process. Cooling This process ensures that web is cooled before it could be handled at next process stage easily. Flattener The web is then pa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xert high pressure on the plate cylinders and tension/stress on the plate edge which is bent for lockup in the gripper at both ends. Due to this reason, the length of the coated coil cannot be transposed as width of the plate while mounting in the press. 32. Thus, the contention of Hindalco that the wide width coil can be substitutes lower width coil which will ultimately lead to circumvention of the imposed anti-dumping duty is not only an afterthought as it was not a point taken before the designated authority, but it is also not tenable and technically not possible. In fact, the fact during the course of hearing learned counsel stated that Hindalco is setting up a new line for wide width coil to be produced at Hirakut in future. Any planned factory to produce and supply lithographic coils above 1150 mm at Hirakut also means that Hindalco is currently not able to supply wider width coils as required by the appellant. 33. In the material injury analysis, the anti-dumping law requires consideration of period of investigation data and not future commitments which is entirely subjective. The future expansion of scope of product is to be considered under a new investigation or a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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