2006 (8) TMI 337 - AT - Customs

Summary

Issues Involved:
1. Legality of the initiation of mid-term review investigation.
2. Determination of dumping margin and injury.
3. Impact of dumped imports on domestic industry.
4. Likelihood of recurrence of injury.
5. Justification for continued imposition or withdrawal of anti-dumping duty.

Detailed Analysis:

1. Legality of the Initiation of Mid-Term Review Investigation:
The appellant domestic industry contended that the initiation of the mid-term review was illegal due to insufficient positive information. It was argued that the designated authority erred by limiting its investigation analysis under Rule 23 and not considering all relevant parameters. The designated authority, however, justified the initiation based on positive information from the importer, indicating no injury to the domestic industry and suggesting that the injury margin had turned negative. The Tribunal found that there was sufficient positive information to justify the initiation of the review proceedings.

2. Determination of Dumping Margin and Injury:
The designated authority noted that the exporters did not respond to the questionnaire, leading to the construction of normal value as per the rules. The dumping margin for imports from Russia was determined to be 36.56%, while no new dumping margin was established for China PR due to the absence of imports during the period of investigation. The authority concluded that the dumping margin was significant, warranting the continuance of anti-dumping duty.

3. Impact of Dumped Imports on Domestic Industry:
The designated authority examined various parameters, including volume and price effects of dumped imports on the domestic industry. It was found that the domestic demand had increased, and the share of imports from subject countries had declined. The price undercutting margin was less than 2%, and there was no significant price suppression. Despite some negative injury parameters, the overall injury to the domestic industry was not established. The Tribunal, however, emphasized that the landed value of dumped imports was significantly lower than the non-injurious price, indicating a likelihood of material injury if the duty were revoked.

4. Likelihood of Recurrence of Injury:
The designated authority concluded that the fall in the market share of the domestic industry was absorbed by other Indian producers, not by dumped imports. It was held that there was no substantial evidence to support the claim of recurrence of injury. The Tribunal disagreed, noting that the lower landed value of dumped imports compared to the non-injurious price indicated a clear likelihood of material injury if the anti-dumping duty was revoked.

5. Justification for Continued Imposition or Withdrawal of Anti-Dumping Duty:
The designated authority recommended the withdrawal of anti-dumping duty, concluding that injury was not likely to recur. The Tribunal found this recommendation contrary to the evidence of continued dumped imports at non-injurious prices, which indicated a likelihood of material injury. The Tribunal held that the minor improvements in the domestic industry did not outweigh the significant factors indicating injury and threat of injury.

Final Order:
The Tribunal set aside the impugned final findings dated 20-5-2005 and the impugned Notification No. 69/2005-Cus. dated 19-7-2005, allowing the appeal and deeming the anti-dumping duty to have continued till the end of the original period of five years. The request to extend the imposition of duty for a further period of five years was rejected, as the review was concerned only with the potential for earlier revocation, not continuance beyond five years.