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TMI Blog2018 (12) TMI 803X X X X Extracts X X X X X X X X Extracts X X X X ..... ng factor for the petitioner, because Solvay had stayed out of the investigation and therefore was subjected to the residual, higher rate of duty (rather than the considerably lower anti-dumping duty rate imposed on the petitioner’s predecessors). The petitioner had to approach this court, because on the previous occasion the DA felt that since the relevant facts were investigated at the determination of injury margin stage, it had become functus officio. The court therefore, directed the examination of the relevant facts and also stated that if indeed Solvay had exited from the JV, the DA could consider granting the petitioner’s request. The DA has re-examined the petitioner’s contentions and concluded yet again that the amendment sought is unfeasible. The petitioners, naturally cry foul and attack that order as arbitrary and contrary to the previous order of this court. The two step corporate reorganization of the petitioner companies did not entail only name change or inconsequential changes in shareholding. The petitioner’s entities were transformed and placed under the control of different groups. Given that the nature of inquiry by the DA was not superficial but app ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dated 13.06.2014 whereby all these four entities were treated as belonging to one group and anti-dumping duty at the rate of US$ 39.65 per MT was imposed. For the other manufacturers/importers to India, i.e. other companies, they recommended and finally imposed rate of duty as US$ 189.99 per MT. Solvay SA, at the relevant time did not participate in the investigations which led to the final report and the notification and thus had to suffer a higher rate of anti-dumping duties for the exports to Indian markets. The petitioners had approached this Court earlier complaining that their application for apprising the Designated Authority about the name change pursuant to re-organization had been rejected. The Court had by its order dated 02.06.2016 directed the authority to consider the application and pass appropriate orders. The DA, by its order dated 28.06.2016 finally rejected the application [in W.P.(C) 7603/2016]. The DA s reasoning was that although the INEOS group of companies participated and co-operated with it by filing exporter questionnaire response, Solvay did not participate in the investigation and thereby remained non-cooperative. It was commented by the DA that the du ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tioner's margin of profit and the normal price at which they sold the goods was conducted and a detailed investigation which culminated in the final findings resulted in the notification which fixed the margin of anti-dumping duty at US$ 39.65 per MT for all the four group companies. At that point in time, Solvay SA had no connection with these companies. There is no material on record to point to the contrary. The interregnum as it were, with the reorganization and renaming of the petitioners being accompanied by Solvay SA's acquisition of shareholding in two petitioner companies through joint venture had resulted in the order of the Designated Authority, which quite correctly felt that closer investigation was necessary. Since then, the position appears to have altered again because on 08.06.2016, the European Commission gave a green signal for the divestment of Solvay SA's shareholding in Inovyn JV entirely. As a result, this Court, having regard to the fact that the basic circumstances, i.e. market conditions under which the petitioner companies exported to India and the nature of injury caused by them has already undergone detailed investigation, this Court is of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lhelmshaven Gmbh and Vynova Belgium NV did not exist during the period of investigation or on the date of final finding i.e. 04.04.2014, but there were different entities namely, Inovyn Sverige AB, Sweden as INEOS Sverige AB, Sweden; Inovyn Chlorvinyls Limited, UK, as INEOS Chlorvinyl Limited; Vynova Wilhelmshaven Gmbh as INEOS Vinyl Deutschland Gmbh and Vynova Belgium NV as INEOS Chlorvinyl Belgium NV. It was also submitted that Solvay invested in Inovyn Limited on 01.07.2015 when simultaneously changes in names of UK and Swedish companies from Ineos Chlor Vinyls Ld. To Inovyn ChlorVinyls Ltd and Ineos Sverige AB to Inovyn Sverige AB took place and that finally Solvay did exit Inovyn Ltd. on 07.07.2016. 12. Whereas based on the submissions made by the solicitors during the hearings it was noted that in respect of all these entities (except in case of German entity), it was a chain of wholly owned 100% subsidiaries with the holding company at the top. During the course of the hearing, it also came to the light that full facts of this case were never brought out earlier by the petitioners or their solicitors either before the Designated Authority or before the Hon ble High Cour ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... neos Sverige AB would only have changed as Inovyn ChlorVinyls Ltd. Inovyn Sverige AB respectively, without any change in any other factor/parameter including that in the ownership structure and shareholding pattern of these entities. This however, is not the case and the change of name of UK and Swedish entities on the contrary is accompanied by the entry of a new company namely Inovyn Ltd I the ownership structure. Thus post-POI (i.e. subsequent to the period of investigation), a new entity namely, Inovyn Limited came into existence on 01.07.2015 and therefore even after exit of Solvay on 07.07.2016 from Inovyn Limited, the status quo ante (i.e. status existing during the period of Investigation) does not get restored. The solicitors representing petitioners were not even able to satisfactorily explain as to how exit of Solvay from the joint venture company Inovyn Limited did not result in corresponding rise in shares of the Ione Shareholder Ineos Group Investment Limited when there was no change in the face value of shares. They were not able to confirm or deny whether current holding companies in the ownership structure of the German and Belgian entities existed during the per ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bmitted that although the original JV was between INEOS AG and Solvay SA, based on equal equity participation, Solvay left the JV; Solvay which had 50% holding in Inovyn JV, sold its share on 07.03.2016. It is pursuant to this that the restructuring has now resulted in the following holding: International Investor Limited SE __________ Solicitors could not give any convincing response whether it existed during POI International Chemical Investor XII SA __________ Solicitors could not give any convincing response whether it existed during POI Vynova Belgium NV __________ Existed as INEOS Chlorvinyl Belgium NV during POI 9. It is further submitted that on 25.05.2016, in the meanwhile, the name of one for the petitioner s business was changed from its erstwhile Vynova Tessenderlo NV. This was on account of a settlement agreement brought about by Tessenderlo created after. This name change did not entail any change in the shareholding pattern. It is highlighted ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that this Court should give due consideration to that fact. What stood different was that the change of name of the corresponding change in the corporate structure was post period of investigation Inovyn s exit on 01.07.2015. Therefore, even after exit of Solvay from Inovyn Limited, the status quo ante did not get restored. The petitioner could not establish how Solvay s exit from JV Inovyn Limited did not result in corresponding price of lone shareholding in Inovyn Group when there is no change on the face. 13. It is argued on behalf of the DA that the order dated 02.12.2016 in the previous writ petition had required the examination of the facts, and grant the change of name request of the petitioners if it was found that Solvay SA had exited from its (the petitioner s) shareholding and if status quo ante had been restored. It is submitted that this court's direction in the order dated 02.12.2016 was on the implied assumption that the above stated facts furnished by the Petitioner were correct and bona fide. The DA states that on examination it was found that the Petitioner had wrongly stated the facts. It is submitted that the Petitioner could not establish two fundamenta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... try. 16. In Reliance Industries Ltd. v. Designated Authority (2006) 10 SCC 368 , it was explained that industries built after independence with great difficulty should not be allowed : to be destroyed by unfair competition of some foreign companies. Dumping is a well-known method of unfair competition which is adopted by the foreign companies. 17. The Court also said that: The purpose of Section 9-A is, therefore, to maintain a level playing field and prevent dumping, while allowing for healthy competition. The purpose is not protectionism in the classical sense (as proposed by the German economist Friedrich List in his famous book National System of Political Economy published in 1841) but to prevent unfair trade practices. The 1995 Amendment to Section 9A was apparently made in pursuance to Article VI of the General Agreement on Tariffs and Trade 1994 (GATT 1994) which permitted antidumping measures as an instrument of fair competition. The concept of anti-dumping is founded on the basis that a foreign manufacturer sells below the normal value in order to destabilise domestic manufacturers. 18. An anti-dumping proceeding, leading to a determinat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reading, it would appear that that this court had required the DA to reconsider the issue and if it was found that Solvay had indeed exited from the holding JV, to grant the relief to the petitioner. 22. The fresh order of the DA, states as follows: The petitioners contention would have had merit if the name of these entities e.g. Ineos Chlor Vinyls Ltd Ineos Sverige AB would only have changed as Inovyn Chlor Vinyls Ltd. Inovyn Sverige AB respectively, without any change in any other factor/parameter including that in the ownership structure and shareholding pattern of these entities. This however, is not the case and the change of name of UK and Swedish entities on the contrary is accompanied by the entry of a new company namely Inovyn Ltd I the ownership structure. Thus post-POI (i.e. subsequent to the period of investigation), a new entity namely, Inovyn Limited came into existence on 01.07.2015 and therefore even after exit of Solvay on 07.07.2016 from Inovyn Limited, the status quo ante (i.e. status existing during the period of Investigation) does not get restored. The solicitors representing petitioners were not even able to satisfactorily explain as to how exi ..... 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