1997 (2) TMI 285 - AT - Customs

Summary

Issues Involved:

1. Determination of "Normal Value" of NBR.
2. Determination of "Margin of Dumping".
3. Existence of "Dumping".
4. Material injury to domestic industry.
5. Causal connection between dumping and injury.
6. Imposition and quantification of anti-dumping duty.

Detailed Analysis:

1. Determination of "Normal Value" of NBR:

The Designated Authority determined the "Normal Value" under Section 9A(1)(b)(i) of the Customs Tariff Act, 1975, which refers to the comparable price in the ordinary course of trade for the said article in the exporting country. The appellants contended that the Authority should have used sub-clause (ii)A or (ii)B of Clause (b) of the Explanation, which involves the highest comparable price for the said article to any third country or the cost of production in the country of origin. The Authority's determination of "Normal Value" was based on retail prices published in Japan Chemical Week, adjusted for dealers' commission, technical and after-sales service, and R&D costs, resulting in a Normal Value of US $3,677 PMT. The appellants argued that the Authority did not adequately account for the peculiar retail market conditions in Japan. However, the Authority's adjustments were deemed reasonable given the non-cooperation from the exporters in providing necessary data.

2. Determination of "Margin of Dumping":

The "Margin of Dumping" was calculated as the difference between the Normal Value (US $3,677 PMT) and the Export Price (US $1,048 PMT), resulting in a margin of US $2,619 PMT. The correctness of the Export Price was not disputed. Since the Normal Value determination was upheld, the Margin of Dumping was also affirmed.

3. Existence of "Dumping":

The Authority concluded that the exporters from Japan had dumped NBR in India, causing material injury to the domestic industry. This conclusion was based on the significant difference between the Normal Value and the Export Price, which constituted dumping under the Act.

4. Material Injury to Domestic Industry:

The Authority examined various factors, including the volume of dumped imports, their effect on domestic prices, and the impact on domestic producers. The investigation covered the period from 1-4-1993 to 31-3-1994. The Authority found that the quantity of NBR imported from Japan increased significantly, causing price undercutting and forcing the domestic industry to reduce prices to unremunerative levels. This resulted in material injury to GAPL, the main Indian manufacturer of NBR. The Authority's findings were based on increased imports from Japan, reduced domestic market share, and suppressed domestic prices.

5. Causal Connection Between Dumping and Injury:

The Authority established a causal link between the dumping of NBR by Japanese exporters and the material injury suffered by the domestic industry. The investigation revealed that the aggressive price reduction by Japanese exporters led to significant market share loss and price suppression for GAPL. The appellants' arguments regarding inefficiency and poor quality of GAPL's NBR were rejected due to lack of concrete evidence.

6. Imposition and Quantification of Anti-Dumping Duty:

The Authority recommended an anti-dumping duty of Rs. 19,306 PMT to remove the injury caused by the dumped imports. This recommendation was based on the difference between the weighted average price of Japanese imports and the fair selling price of NBR produced by GAPL, determined at the optimum level of capacity utilization. The appellants argued that the fair selling price was not disclosed, but the Authority's assessment was found to be fair and satisfactory. The imposition of the anti-dumping duty was justified to eliminate the effect of dumping and protect the domestic industry.

Conclusion:

The appeals were dismissed, and the order passed by the Designated Authority was upheld, affirming the determination of Normal Value, Margin of Dumping, existence of dumping, material injury to the domestic industry, causal connection between dumping and injury, and the imposition of anti-dumping duty.