2023 (11) TMI 570 - AT - Customs

Scope of Anti Dumping duty when similar goods are not manufactured in India - Exclusion of product colour coated aluminium coils from imposition of anti-dumping duty - modification in the consequential customs notification 6-12-2021 issued by the Central Government to exclude colour coated aluminium coils from imposition of anti-dumping duty retrospectively w.e.f. 6-12-2021 and for refund of the excess/additional duty so collected on the import of colour coated aluminium coils w.e.f. 6-12-2021. HELD THAT - Anti-dumping duty has been levied on imports of flat rolled products of aluminium originating in or exported from China PR. The appellant is a manufacturer of Aluminium Composite Panel sheets in India, and uses different types of colour coated coils as a raw material to manufacture the finish goods i.e. ACP. Thus, imposition of anti-dumping duty on colour coated coils would work to the prejudice of the appellant. What also needs to be noticed is that in the earlier final findings dated 29-5-2009 relating to safeguard duty investigation in respect of import of aluminium flat rolled products and aluminium foil to India from China PR, which concerned Hindalco also a domestic producer, it was sought to be contended by the interested parties that aluminium colour coated coils are not manufactured by the domestic industry and, therefore, cannot be included in the ambit of product under consideration. It would be seen from the aforesaid final findings recorded by the designated authority that it was not a case set up by Hindalco that it manufactures colour coated coil - In the case of coating by fluorine carbon, the aluminium coil is subjected to fluorine carbon resin, pigment and it is after high temperature roasting and baking that the paint is solidified with dry films with super weather resistance. The inevitable conclusion that follows from the aforesaid discussion is that Hindalco does not manufacture/produce colour coated coil as it has failed to produce any evidence before the designated authority or before the Tribunal to substantiate that it has even the capacity to manufacture/produce colour coated coil, much less produce colour coated coil in commercial volumes. Thus, if the domestic industry does not manufacture/produce colour coated coil, this product would have to be excluded from scope of the product on which anti-dumping duty has been imposed under the customs notification dated 6-12-2021 issued by the Central Government on the basis of the final findings dated 7-9-2021 issued by the designated authority - The customs notification dated 6-12-2021 is, accordingly, modified by excluding the colour coated coil from imposition of anti-dumping duty. Appeal allowed.

Summary

Issues Involved:
1. Inclusion of 'colour coated aluminium coils' within the scope of anti-dumping duty.
2. Compliance with the Manual of Standard Operating Practices.
3. Past determinations and exclusions of similar products.
4. Principles of natural justice and procedural fairness.

Summary:

1. Inclusion of 'colour coated aluminium coils' within the scope of anti-dumping duty:
The appellant, ACP Manufacturer Association, argued that the designated authority erred in including 'colour coated aluminium coils' within the scope of the subject goods for anti-dumping duty. They contended that the domestic industry did not manufacture or sell these coils in commercial volumes and lacked the capacity and facilities to produce them. The appellant highlighted that the process of converting ACP stock to colour coated aluminium coils requires significant investment and specialized machinery, which the domestic industry did not possess.

2. Compliance with the Manual of Standard Operating Practices:
The appellant pointed out that the Manual of Standard Operating Practices for Trade Remedy Investigations specifies that the product under consideration should include only those items manufactured and commercially sold by the domestic industry. The designated authority ignored this guideline by including colour coated coils, which were not produced or sold commercially by the domestic industry.

3. Past determinations and exclusions of similar products:
The appellant referenced past determinations where colour coated aluminium coils were excluded from the scope of the product under consideration. This included a safeguard duty investigation in 2009 and an anti-dumping investigation in 2017, where the Tribunal had excluded colour coated aluminium foil from the scope of the product under consideration.

4. Principles of natural justice and procedural fairness:
The appellant argued that the designated authority violated principles of natural justice by relying on materials and facts not disclosed in the disclosure statement, thus denying the appellant an opportunity to respond. The appellant also contended that the domestic industry failed to provide specific details of its production capacity and sales of colour coated aluminium coils.

Judgment:
The Tribunal concluded that the domestic industry did not manufacture or produce colour coated aluminium coils in commercial volumes and lacked the necessary facilities and capacity. The Tribunal noted that the process of manufacturing colour coated coils is elaborate and requires significant investment. The domestic industry's claim of engaging job workers for merely applying colour was insufficient to warrant inclusion of colour coated coils within the scope of the product under consideration.

The Tribunal modified the customs notification dated 6-12-2021 to exclude 'colour coated coils' from the imposition of anti-dumping duty. The appeal was allowed to this extent.