2005 (7) TMI 132 - AT - Customs

Anti-dumping duty on imports of Poly-Iso-Butene (PIB) - Appeal against imposition - determination of existence of injury and its causal link with the dumped imports - HELD THAT - It is evident from the impugned final findings, the Designated Authority was fully conscious of all the relevant principles and factors, required to be considered under Rule 11 and Annexure II to the rules for injury determination and the causal link and the determination had been made on the basis of the relevant parameters. The Designated Authority has rightly found that the total dumped imports had relatively increased by 13% during the period of investigation. The total production of the petitioner company of the subject goods during 1999-2000 was 6111 MTs which decreased to 5648 MTs during the period of investigation representing a decrease of about 7.58%. The total sales volume of the petitioner decreased by about 18.38%. The average capacity utilisation of the petitioner also decreased to 75.31% during the period of investigation. During the last five months' period of investigation, the average sales realisation for the petitioner had drastically decreased. The average cost of production of the subject goods had substantially increased during the period of investigation. The increase in the sales realisation during the earlier period did not compensate the increase in cost of production during the same period over the previous year. During the period of investigation, the petitioner had incurred heavy losses from the subject goods. The closing stock of the domestic industry during the period of investigation increased by 351% over the previous year of 1999-2000. On consideration of the relevant factors, we are satisfied that the Designated Authority had rightly concluded that, the domestic industry had suffered material injury from the dumped imports, that the parameters cumulatively indicated that the petitioner had suffered material injury, and that the injury had been caused due to the dumped imports of the subject goods. The contentions raised on behalf of the appellants cannot, therefore, be accepted. We, accordingly, hold that the conclusion reached by the Designated Authority in the final findings for recommending imposition of anti-dumping duty on imports from the subject countries, was fully justified and the impugned final findings and the Notification issued by the Central Government on the basis thereof, are legal and valid. Both these appeals are, therefore, dismissed.

Issues Involved:
1. Validity of the petition by Kothari Sugar and Chemicals Ltd. as representative of the domestic industry.
2. Determination of injury to the domestic industry.
3. Causal link between dumped imports and injury to the domestic industry.
4. Maintainability of appeals by importers not importing during the investigation period.
5. Evaluation of injury parameters and their impact on the domestic industry.

Issue-wise Detailed Analysis:

1. Validity of the Petition by Kothari Sugar and Chemicals Ltd.:
The appellants argued that the petition by Kothari did not represent a 'major proportion' of the total domestic output of PIB, and thus, the application lacked sufficient evidence to prove dumping, injury, and causal link. The Designated Authority, however, found that the petitioner accounted for more than 25% of the domestic production and was supported by IPCL and Kochi Refineries Ltd. IPCL's activity of converting C-4 into PIB through job workers was considered connected with the manufacture of PIB, thus fulfilling the criteria under Rule 2(b) of the Customs Tariff (Identification, Assessment, and Collection of Anti-dumping Duty on Dumped Articles and for Determination of Injury) Rules, 1995.

2. Determination of Injury to the Domestic Industry:
The Designated Authority concluded that the Indian Industry suffered material injury due to price under-cutting, price suppression, and significant increase in the volume of dumped imports of PIB from Brazil, Japan, Korea RP, and Singapore. It was noted that the total dumped imports increased by 13% during the investigation period, and the domestic industry faced reduced production, decreased sales volume, lower capacity utilization, increased costs, and significant financial losses.

3. Causal Link Between Dumped Imports and Injury:
The Designated Authority determined that the injury to the domestic industry was caused cumulatively by the dumped imports from the four countries. The injury was assessed based on significant price undercutting, price depression, and the inability of the domestic industry to raise prices due to the low prices of dumped imports. The tender floated by IOC, opened during the investigation period, revealed that the export prices quoted by the exporters were much lower than the non-injurious price, confirming the threat of material injury.

4. Maintainability of Appeals by Importers Not Importing During the Investigation Period:
The respondents challenged the maintainability of the appeals on the grounds that the appellants were not 'interested parties' as they did not import during the investigation period. However, the Tribunal found that the appellants, being known importers before and after the investigation period and having participated in the proceedings, were 'persons aggrieved' and entitled to file appeals under Section 9C of the Customs Tariff Act, 1975. The inclusive definition of 'interested party' under Rule 2(c) was interpreted broadly to include importers affected by the anti-dumping duty.

5. Evaluation of Injury Parameters and Their Impact on the Domestic Industry:
The appellants contended that the Designated Authority did not properly evaluate all injury parameters and that the reduction in price was due to internal competition among domestic producers. The Designated Authority, however, considered all relevant factors, including the volume of dumped imports, price effects, and the impact on the domestic industry. The determination was based on positive evidence, and it was found that the domestic industry suffered material injury from the dumped imports. The Tribunal upheld the Designated Authority's findings, noting that the injury was not due to internal competition but due to the significantly lower prices of dumped imports compared to the non-injurious price.

Final Order:
The Tribunal dismissed the appeals, holding that the Designated Authority's conclusion to impose anti-dumping duty on imports from the subject countries was justified, and the final findings and the Notification issued by the Central Government were legal and valid.

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