2018 (3) TMI 655 - AT - Customs

Imposition of ADD - Castings for Wind Operated Electricity Generators (PUC) - Import from China PR - These appeals mainly agitated on the scope of PUC and DI as well as contesting the imposition of AD duty alleging no injury to the DI - Held that - All castings, whether or not machined, in raw, finished or sub-assembled form, or as a part of sub-assembly, or a part of an equipment/ component, meant for wind operated electricity generators are covered in the present investigation - there could be no ambiguity or possibility of confusion in understanding the scope of PUC covered in the AD investigation. Scope of the DI - locus of M/s Bradken India Pvt. Ltd. to be considered as DI - Held that - Since, the investigation is restricted to the PUC, we are not concerned with the stature and size of L&T or Bradken India Pvt. Ltd. This has nothing to do with the examination of relevant economic parameters by the DA. Such economic parameters are examined only with reference to manufacture of PUC by L&T/ Bradken India Pvt. Ltd. The other activities and business of L&T has no bearing to the present investigation. After detailed analysis of demand, import volume, market share, price effect of imported goods, price undercutting/under selling/ price suppression/depression and also the economic parameters of DI, the DA arrived at his conclusion regarding existence of dumping and its consequence on the DI causing injury. In fact, the DI had suffered substantial loss during the material period and there were negative return on capital employed. This is clear from the analysis of the DA at para 108 of the final finding. The DI suffered losses throughout the injury period though some cash profits were made during 2013-2014 and POI. While upholding the imposition of AD duty as per the final finding, we direct the DA to examine, afresh, the factual claims made by the DI on this aspect. After due examination, the DA may issue his finding on this aspect. In case based on the factual input, the margin of dumping and thereby the injury parameters vary then the AD duty shall accordingly be fixed by the DA. The appeals filed by Indian importer and Chinese Exporters were dismissed.

Issues Involved:
1. Scope of Product Under Consideration (PUC)
2. Imposition of Anti-Dumping (AD) Duty
3. Status and Scope of Domestic Industry (DI)
4. Calculation of Dumping Margin and Injury Margin

Issue-Wise Detailed Analysis:

1. Scope of Product Under Consideration (PUC):
The appellants contested that the Designated Authority (DA) improperly expanded the scope of the product under consideration (PUC) during the anti-dumping investigation. They argued that the initial notification for investigation mentioned "Castings for wind operated electricity generators," but the DA included various casting parts and components in the final findings, which they claimed were not initially covered. However, the Tribunal found that the Initiation Notification dated 01/02/2016 clearly and elaborately defined the scope of PUC, including all castings, whether machined, in raw, finished, or sub-assembled forms, meant for wind-operated electricity generators. The Tribunal concluded that there was no ambiguity or expansion of scope by the DA, dismissing the appellants' claim as factually incorrect.

2. Imposition of Anti-Dumping (AD) Duty:
The appellants argued that there was no injury to the domestic industry (DI) as the DI had increased sales and there was no clear calculation of the dumping margin. They claimed that the principles laid down in Annexure-II of the AD rules were not followed. The Tribunal examined the final findings and noted that the DA had categorically recorded the dumping margin and applied Rule 11 of the AD rules read with Annexure II to determine the injury. The DA's analysis showed that the DI suffered substantial losses and negative returns on capital employed during the material period, indicating significant injury due to dumping. Therefore, the Tribunal upheld the imposition of AD duty, finding the appellants' claims without merit.

3. Status and Scope of Domestic Industry (DI):
The appellants questioned the recognition of M/s Bradken India Pvt. Ltd. as the DI, arguing that the economic parameters relevant to M/s L&T, who initially applied for the investigation, differed from those of M/s Bradken. The Tribunal noted that M/s L&T had been pursuing the matter since 2012 and had transferred the business related to casting products to M/s Bradken through a business transfer agreement. The DA had examined and recorded the status of DI correctly, focusing on the manufacture of PUC by L&T/Bradken. The Tribunal found no grounds for the appellants' grievance regarding the recognition and analysis of DI.

4. Calculation of Dumping Margin and Injury Margin:
The DI appealed against the final finding, arguing that the DA committed an error in quantifying the dumping margin and injury margin by comparing the normal value of rough castings with the export price of finished castings. The Tribunal noted that the DA did not provide a clear analysis or specific findings on this claim. The Tribunal directed the DA to re-examine the factual claims made by the DI regarding the weight difference between rough and finished castings and to issue a finding on this aspect. The Tribunal upheld the imposition of AD duty but directed the DA to complete the re-examination within eight weeks and adjust the AD duty accordingly based on the findings.

Conclusion:
The Tribunal dismissed the appeals filed by the Indian importer and Chinese exporters, upholding the imposition of AD duty. The appeal by the DI was disposed of with a direction to the DA to re-examine the calculation of dumping and injury margins, considering the weight difference between rough and finished castings, and to issue a finding on this aspect. The AD duty imposed and collected as per the final finding and customs notification would continue in the meantime.

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