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TMI Blog2019 (7) TMI 356X X X X Extracts X X X X X X X X Extracts X X X X ..... in the earlier part of Final Finding as well as Disclosure Statement, in his conclusion reached in the Final Finding in its submissions, which have been reproduced hereinabove. On analysis of the same, it appears that while considering the import as insignificant which constituted 98% of the total import and 6% of consumption in India which more than insignificant as defined in Rule 14(d) of the Rules has not been properly considered by respondent No.2 - according to Rule 14(d), the percentage has been given in the import of the like product. Now, admittedly, in view of para-62 at page No.265, the imports are 5.84% which is above the insignificant import as per Rule 14(d). Thus, the observations made by the DA is misreading of the facts and the DA has not properly appreciated this very observation while reaching in the conclusion in Final Finding and this fact is corroborated from the Final Finding itself. Thus, according to Rule 14(d), the percentage has been given in the import of the like product. Now, admittedly, the imports are 5.84% which is above the insignificant import as per Rule 14(d). Thus, the observations made by the DA is misreading of the facts and the DA has not pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as to quash and set aside Impugned Final Finding No.7/16/2018-DGAD dated 29.01.2019 along with Disclosure Statement dated 15.01.2019 issued by the Respondent no.2 and annexed at Annexure - G and H hereto; and B. Pending admission, hearing and final disposal of this petition, this Hon'ble Court be pleased to direct Respondent No.3 not to refrain from taking any steps in furtherance of the Impugned Final Finding dated 29.01.2019 issued by it and annexed as Annexure - G and Annexure - H hereto; C. Pending admission, hearing and final disposal of this petition, this Hon'ble Court be pleased to direct the Respondent nos.1 to 4 to ensure that subject goods that may be cleared are duly accounted for and further the importers be notified about pendency of the present petition before this Hon'ble Court and subject to the outcome of the same; D. Ad-interim reliefs in terms of prayers (B) and (C) above; E. Ex parte ad-interim reliefs in terms of prayer (D) above; F. For cost; and G. Such other and further orders as may be considered fit and expedient in the facts of the case be passed. 3. It is contended that the petitioner No.1 is a company incorporated under the provisi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... inafter be referred to as "the DI") requested imposition of Anti-dumping Duty (hereinafter be referred to as "the ADD") on the imports of subject goods. Thereafter, on the basis of the inquiry conducted by respondent No.2, a Final Finding Notification No.60/1/2000-DGAD dated 22.01.2002 was issued recommending imposition of ADD. The definitive antidumping duties in the form of benchmark were imposed by respondent No.2. It is contended that at the end of 5th year, the DI filed an application for 'sunset review" in the year 2006 whereupon investigation was initiated by respondent No.2 to examine whether the expiry of the duty would lead to continuation or recurrence of dumping and inquiry. Respondent No.3 vide its Notification No.83/2006 extended the definitive Anti-dumping Duties in terms of Section 9A(5) for a period of one year up to 05.09.2007. 3.3 It is contended by the petitioners that after conducting a detailed investigation, respondent No.2 issued final finding vide its Notification No.15/20/2006-DGAD recommending continuation of ADD. In pursuance thereof, respondent No.3 issued Notification No.99/2007-Customs (ADD) levying ADD for a further period of five years. 3.4 It i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ier have been extended by respondent No.3 for a period of six months i.e. upto 26.04.2019 vide Notification No.29/2018-Customs (ADD) dated 20.08.2018. It is contended that on 29.08.2018, respondent No.2 granted public / oral hearing to all the interested parties to present their views orally and on 07.09.2018, petitioner No.1 submitted a detailed written submission justifying the need for the continuation of the duty. 3.6 It is contended by the petitioners that on 15.01.2019, respondent No.2 issued Disclosure Statement under the provisions of Rule 16 of the Rules, which require disclosure of essential facts received and interpreted by it which are under consideration for the purpose of arriving at a final conclusion. According to the petitioner, therefore, it filed its comments on the disclosure statement submitting that the disclosure statement is incomplete as it has not addressed the certain major submission made by petitioner No.1 and requested the authority to disclose the essential facts before issuing the Final Finding. However, respondent No.2, without appreciating the submission made by petitioner No.1 issued impugned Final Finding vide Notification F No.7/16/2018-DGAD w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e country, which was primarily in the last two decades (all these closures are more than 5 years old and are prior to previous extension of ADD). v. As per 145th Parliamentary Standing Committee on Commerce which assessed the impact of Chinese goods on India industry, it is clearly stated that API sector needs protection from imports and the Government of India also endeavours to revive the API sector in India. vi. Katoch Committee Report dated 24th September, 2015 on Active Pharmaceuticals Ingredients (APIs) specifically states that a long term strategy for strengthening API sector by involving Ministry of Commerce as well as other regulatory authorities is required which involves judicious and liberal use of measures like anti-dumping. vii. FICCI report February 2018 edition on "Trends and Opportunities for Indian Pharma" highlights that dependence on China for API supplies exposes the pharma industry to raw material supply disruptions and price volatility. viii. Office Memorandum dated 18th April, 2018 issued by the Government of India, Ministry of Chemicals and Fertilizers, Department of Pharmaceuticals, constituted a Tast force to formulate a road map for enhanced ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of essential facts thereby violating the principles of natural justice and denying the domestic industry an opportunity to defend its interests. (b) Impugned Final Finding is a non-speaking order and does not address all the issues and concerns raised by the domestic industry in violation of the requirements of reasoned explanation under Rule 17 of the Anti-Dumping Rules. (c) Error on the part of respondent No.2 in considering import as insignificant which constituted 98% of the total import and 6% of consumption in India. (d) Conclusions arrived at by respondent No.2 are contrary to the facts showing likelihood of injury to domestic industry in the event of revocation of duty. (e) Current / continued injury to the domestic industry not a mandatory pre-condition in sunset review investigation conducted under Section 9A(%) of the Act read with Rule 23 of the Rules. (f) In an anti-dumping investigation, once the domestic industry has provided prima facie sufficient evidence of likelihood of dumping and injury and the Designated Authority has initiated investigation then the onus to show absence of likelihood of dumping and injury is on the exporters. (g) Failure on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bjection dated 22.1.2019. The authority without there being any decision thereon, rendered its final findings, which could be seen from the page No. 261 and 262. In view thereof the Court is of the view that as there is a prima-facie breach of principle of natural justice as the decisions have been rendered prima-facie without affording appropriate material to the concerned, the Court has issued Notice for final disposal and have been expected from the other side to file reply, if any, by the returnable date, in case if notice is served within a reasonable time from today. Learned counsel further submitted that conclusions are diametrical opposite to the final findings recorded. Direct service is permitted." Thereafter, time and again the matter has been adjourned. Today, Shri Desai, learned advocate appears for the designated authority and submitted that the anxiety expressed on behalf of the petitioner that the anti dumping duty for extended period also would come to an end by 26.04.2019 and he is yet to receive instructions and reply, if any, for conducting the matter finally. In that view of the matter, he seeks time up to 22.04.2019 only. Learned counsel for the pe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... thereafter was required to be adjounred at the instance of respondent as could be seen from the order of 11.4.2019 wherein also the Court in fact had reproduced the earlier order only with a view to infuse the sense of urgency which appears to have worked but not to the fullest as though the reply has come but in a soft copy which cannot be placed on record and there is a justification on the part of the counsel for the petitioner with respect to the appropriate direction for extending the antidupming duty so that the subject matter of petiton may not be rendered infructuous and irretrivable situation may be avoided. The Court is, therefore, of the view that let there be a direction to respodnent No.1 that the antidumping duty as mentinon in Notification No.39-2018-Custom( ADD) for the product paracetamol dated 20.8.2018 at page 119 shall be extended for a further period of two months that would take care of hearing aspect as by then the pleading would be completed. The antidumping duty as mentioned in the notification dated 20.8.2018 be extended for a further period upto 24.6.2019. The matter may be posted for hearing on 12.6.2019 and the parties shall exchange their pleadings, i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ENDING THEIR INTERESTS : 1. Respondent no.2 has erroneously applied Rule 7 in the present investigations, in so far as it has failed to disclose the details of the Dumping Margin calculations to the petitioners no.1 in para 52 3 (a) (b). Determination of Dumping Margin for china PR as a whole. a) Comparing the normal value and export price at exfactory level for the country as a whole, the dumping margin for the subject country is determined as below: Particulars US$/kg.Rs/kg (POI) US$/Kg Rs/kg Normal value *** *** Net Export Price *** *** Dumping Margin *** *** Dumping Margin % *** *** Range % 10-20 10-20 b. After details analysis of DGCIS transaction wise data it has been observed that out of total imports of china PR i.e *** MT *** % imports are dumped and *** % are injurious. 2. The Dumping margin is the difference between the Normal Value and export price. In the facts of the present case, the Normal Value has been determined based on the information furnished by the petitioner, which has been disclosed to the petitioner. However, export price based on DGCI&S data which, are available in public domain ought to have been disclosed to the peti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erein below: "(5) The anti-dumping duty imposed under this section shall, unless revoked earlier, cease to have effect on the expiry of five years from the date of such imposition: Provided that if the Central Government, in a review, is of the opinion that the cessation of such duty is likely to lead to continuation or recurrence of dumping and injury, it may, from time to time, extend the period of such imposition for a further period of five years and such further period shall commence from the date of order of such extension. 8. Respondent no. 2 has acted in violation of the provisions of section 9A (5) of the Act read with Rule 23 of the Rules in as much as it has lent unwarranted weightage to the fact that the petitioner No.1/Domestic Industry is allegedly not suffering injury during the current period. While issuing the impugned final finding, respondent no.2 stated that "the domestic injury has shown improvement in terms of all injury parameters and there is no injury to the Domestic industry". [Para-126(3) of Impugned Final findings (page no. 281)]. 9. The assessment whether injury will continue, or recur, would entail a counter-factual analysis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... said producer are dumped and *** MT are injurious. [para no. 85-87 (page no. 273- 274). SUBMISSION Respondent no. 2 erred in considering import as insignificant which constituted 98% of the total import and 6% of consumption in India (more than insignificant as define in Rule 14(d), Even otherwise Rule 14 of the Rules dealing with the termination of investigation on the basis of insignificant imports is explicitly excluded from Rule 23(3) and therefore issuance of the impugned final findings by respondent no. 2 in the present case on the basis of the volume of insignificant import are contrary to the mandate of law. * Imports are 5.84% (above diminimus level) (paragraph no.62 table at page no.265); and * Rule 14(d) at defines volume of significant import (page no.99) 1. (b) Sufficient freely disposable, or an imminent, substantial increase in, capacity of the exporter indicating the likelihood of substantially increased dumped exports to Indian markets, taking into account the availability of other export markets to absorb any additional exports. 89. The Authority evaluated the existing surplus capacities, capacity addition, if any, with the responding exporters, possibil ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... producers are export oriented. (C) Inventories of the article being investigated 90. The questionnaire response filed by the Chinese producer's shows that level of inventories with the cooperative producers / exporters is quite significant. Producer Uni ts 2 01 5 2 016 2017 Poi M/s.Anqi u Lu An Pharmac eutical Co. Ltd. MT *** *** *** *** Lianyun gang Kangle Pharmac eutical Co. Ltd. MT *** *** *** *** Hebei Jihen (group) Pharmac Eutical Co. Ltd. MT *** *** *** *** Total MT *** *** *** *** (D) Price attractiveness of Indian mark 91. Analysis of the China PR Custom data with regard to export from China PR to the rest of the world, indicate that with the revocation of ADD, the Indian prices would be attractive for the Chinese producers / Exporters to increase their exports to India and the same can be deducted from the table given below: Country Quan tity (kg) Valu e USD Pri ce US D/k G India (IN) *** *** *** Congo, DR *** *** *** Cuba (CU) *** *** *** Kenya (KE) *** *** *** Mauritius (MU) *** *** *** Indonesia (ID) *** *** *** S. Africa (ZA) *** *** *** Iraq (IQ) *** *** *** Zambia (ZM) *** *** *** Russia (RU ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ndia and another Vs. Meghmani Organics Limited reported in (2016) 10 SCC 28; 4. In the case of DCW Limited Vs. Union of India, rendered on 11.06.2018 by this Court in Special Civil Applications No.14202 of 2017 and allied matters . 10. Learned advocate for respondent No.3 has placed on record the written submissions which reproduced as under:- Re: The Notification dated 16.04.2019 (Rescinding Notification) issued by the Department of Revenue is not impugned in the Writ by way of a formal amendment. 1. At the very outset, it is respectfully stated that the Notification dated 16.04.2019 (Rescinding Notification) which was issued by the Respondent No. 3, Ministry of Finance under Rule 18 of the Anti-Dumping Rules, 1995 have not been impugned in the present Writ Petition preferred by the Petitioner. 2. Albeit the Petitioner herein had filed an application, bearing No. IA No. 1 of 2019 in the present Writ Petition, praying for, inter alia, quashing the Rescinding Notification of the Respondent No. 3 as well staying the operation and effect thereof; it is pertinent that till date no formal amendment has been preferred in the present Writ Petition, impugning the said Rescindi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . (4) The provisions of sub-section (1), (2), (5) and (6) or section 129C of the Customs Act, 1962 shall apply to the Appellate Tribunal in the discharge of its functions under this Act as they apply to it in the discharge of its functions under the Customs Act, 1962. (5) Every appeal under sub-section (1) shall be heard by a Special Bench constituted by the President 0f the Appellate Tribunal for hearing such appeals and such Bench shall consist of the President and not less than two members and shall include one judicial member and one technical member. 7. In this regard, it may not be out of place to place reliance on the recent judgment of Designated Authority V. San Disk, reported in 2018 13 SCC 402, wherein the domestic industry had raised similar issues, including without limitation that the Designated Authority had violated principles of natural justice and/ or that all material / information was not provided to it. In such similar circumstances as well, the Hon'ble Supreme Court was pleased to opine that in view of the statutory remedy provided under section 9C of the Customs Tariff Act. 1975, the writ petition under Article 226 would not be entertained. Several o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the writ petition cannot be urged before the CESTAT. It is not without significance that the Gujarat High Court makes no reference in the above passage in Nirma Ltd. v. Union of India (supra) to Section 9C of the CTA. 9. We Court is also not persuaded to take a view different the one it has in Alcatel-lucent India Ltd. v Designated Authority (supra); PTA Users Association v. Union of India (supra) and Balaji Action Buildwell v. Union of India (supra). 10. The question is not whether this Court can entertain the present writ petition. The question is whether, in the facts and circumstances, it should? The power under Article 226 of the Constitution is an extra-ordinary one and should not be exercised in a routine manner especially when the Petitioner has an efficacious and adequate alternative statutory remedy available. Otherwise, the Court would be supp/anting the functioning of the statutory appellate authority tasked specifically with reviewing the correctness of the orders of the subordinate statutory authorities. Therefore, while acknowledging that this Court does have the jurisdiction to entertain the writ petition, in the facts and circumstances of the present case ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Rescinding Notification dated 16.04.2019, this Hon'ble Court cannot revive the notification which is already dead in the eyes of law, and neither can the same be enforced. The Petitioner herein has failed to appreciate that in such a case (apart from preferring an appeal before CESTAT), the Petitioner is empowered under law to freshly initiate the process for levy of duty under the provisions of the Custom Tariff Act, 1975 and the Anti Dumping Rules, 1995; but once the Anti Dumping Duty has been rescinded in accordance with the provisions of law, neither can the said rescinding be suspended by the court, nor can the Anti Dumping Duty be extended without following the due process of law as provided in the Custom Tariff Act, 1975 and the Anti Dumping Rules, 1995. 13. In this regard, the second proviso to Section 9A (5) of the Customs Tariff Act, 1975 is instructive and reads as follows: "Provided further that where a review initiated before the expiry of the aforesaid period of have years has not come to a conclusion before such expiry, the anti-dumping duty may continue to remain in force pending the outcome of such a review for a further period not exceeding one year." ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y prejudice to the Petitioners, its plea qua the alleged noncompliance ought to be rejected by this Hon'ble High Court. 16. Without prejudice to the aforesaid submissions, it is further respectfully submitted that it is well settled, the writ jurisdiction of the Hon'bIe High Court cannot be used to give a direction to the legislature or the subordinated legislature (as in the present case) to enact a particular law; and neither can the writ jurisdiction of the Hon'ble High Court be invoked to interfere in matters related to policy and economic matters. It is humbly stated that the issuance/ withdrawing/ rescinding of the notification is a policy decision and extending the period of the notification and keeping notification In abeyance cannot be interfered by the court unless the validity of such actions is challenged on its own merits before the court. In the present circumstances, the subject goods are in the category of generic and mass consumption medicines, which are being routinely consumed by the all sections of the population. Hence, India, which is a welfare state, is duty bound to provide the subject goods at an affordable price to its citizens. As submitted In the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .L.T. 733; 13. Huawei Tech. Co. Ltd. Vs. Designated Authority, reported in 2011 (273) E.L.T. 293 (Tri.-Del.); 14. Supreme Court Employees Welfare Association Vs. Union of India reported in (1989) 4 SCC 187; 15. Census Commissioner and others Vs. R. Krishnamurthy, reported in (2015) 2 SCC 796; 16. Kerala Colour Lab Association Vs. UOI, reported in 2003 (156) ELT 17; 17. R. K. Garg Vs. UOI, reported in 1981 AIR 2138; 18. Rusom Cavasiee Cooper Vs. Union of India, reported in (1970) 1 SCC 248; 19. Suresh Seth Vs. Commr., Indore Municipal Corporation reported in (2005) 13 SCC 287; 20. Haridas Exports Vs. All India Float Glass Manufacturer Association and others, reported in (2002) 6 SCC 600; 11. Mr.Desai, learned advocate for respondent No.2 has vehemently opposed the present petition and has submitted that the petitioners has challenged the Final Finding and DA on the basis that the informations were not supplied to it. While inviting the attention of the Court to the email, Mr.Desai, learned advocate has submitted that the necessary informations have already been supplied to the petitioners by email and the other particulars which are available on public doma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd the question raised by the petitioners could be gone into by the said Tribunal and the methodology could also be tested by the CESTATE. According to him, this is not a forum for the petitioners to revoke the jurisdiction of this Court under Article 226 of the Constitution of India. While relying on the following decisions on the point of jurisdiction, Mr.Desai, learned advocate has requested the Court to relegate the petitioners to prefer alternative remedy of approaching the CESTATE. 1. In the case of Jindal Poly Film Ltd. Vs. Designated Authority, reported in 2018 E.L.T. 994 (Delhi); 2. In the case of Kesoram Rayon Vs. Designated Authority, reported in 2018 (359) E.L.T. 475 (Delhi); 3. In the case of Outokumpu Oyj Vs. Union of India, reported in 2018 (360) E.L.T. 679 (Delhi); 12. In rejoinder, Mr.Soparkar, learned senior advocate for the petitioners has vehemently submitted that though his clients have received email but no annexure has been received by them regarding information on spread sheet. He has submitted that the Disclosure Statement is dated 21.01.2019, whereas, the email in question has sent on 15.01.2019. According to him, this was the earlier informatio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion filed on behalf of the domestic inquiry, respondent No.2 initiated a 'sunset review' investigation to examine whether the expiry of the duty would lead to continuation or recurrence of dumping and injury. (v) On 31.08.2006, respondent No.3 vide its Notification No.87/20067 extended the definitive Anti-Dumping Duties in terms of Section 9A(5) for a period of one year upto 05.09.2007. (vi) On 23.07.2007, after conducting a detailed investigation, respondent No.2 issued Final Finding vide its Notification No. 15/20/2006 - DGAD recommending continuation of Anti- Dumping Duty. (vii) On 03.07.2007, in pursuance of such recommendation, respondent No.3 issued the Notification No.99/2007-Customs (ADD) levying Anti-Dumping Duty for a further period of five years. (viii) On 28.08.2012, respondent No.2 initiated a sunset view investigation vide Notification No.14/1009/2012-DGAD to review the need for continued imposition of duties. (ix) On 19.09.2012, the Anti-Dumping Duty was extended upto 02.09.2013 by respondent No.3 vide Notification No.42/2012-Customs (ADD). (x) On 26.08.2013, After due investigation, respondent No.2 issued Final Finding No. 14/1009/2012 - DGAD reco ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... i. China needs to be treated as non-market economy for the reason that the costs and prices in China do not reasonably reflect the market forces. Para 8 to Annexure - I specifies the parameters which should be considered for grant of market economy status. This also implies that unless these conditions are not fulfilled / satisfied, the Chinese costs and prices cannot be adopted. ii. Chines produces are required to be treated as companies operating under non-market economy environment and the Authority may proceed to determine the normal value on the basis of Para 7 of Annexure - I. iii. The imports are entering the Indian market at dumped prices. iv. There is difference in prices in different important transactions which mean that Chinese producers are selling very same product at a price which differs significantly even at the same time period and is not a peculiar phenomenon of POI, but extends to the entire injury period. v. It is a fit case where wighted average normal value cannot be compared with weighted average export price. The Designated Authority is, therefore, requested to compute the weighted average normal value and compare the same with individual ex ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... elying upon the Indian costs and prices is to be followed only when it was not possible to construct the normal value on the basis of other alternatives prescribed in the opening sentence of Para 7. ix. In terms of the provisions of Para 7, the market economy third country is required to be first identified for determination of normal value and only where it is not possible to obtain necessary data from such third country, the normal value can be determined on any other reasonable basis, including the price actually paid or payable in India for the like product, duly adjusted if necessary, to include a reasonable profit margin. x. The domestic industry is under obligation to inform, without reasonable delay the selection of market economy third country to the parties concerned so as to provide an opportunity to respond to the same. xi. Mandatory procedure prescribed by the law has not been followed, as the interested parties have not been put to notice about selection of the third country. Nor have the interested patties been requested to suggest and make necessary information available about the third country. xii. In the absence of following the mandatory procedure, t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... i. M/s. Anqiu Lu An Pharmaceutical Co., Ltd. ii. M/s.A.H.A. International Co., Ltd. iii. China Sinopharm International Corporation iv. Zhejiang Chemcials Import and Export Corporation v. Lianyungang Kangle Pharmaceutical Co., Ltd. vi. Zhejiang Kangle Pharmaceutical Col.,Ltd. vii. Hebei Jiheng (group) Pharmaceutical Co. Ltd. In view of the responses filed, the Authority has analysed the response made by the producers / exporters as follows:- M/s. Anqiu Lu An Pharmaceutical Co., Ltd. (Producer) and M/s.A.H.A. International Co., Ltd. China Sinopharm International Corporation and Zhejiang Chemicals Import and Export Corporation. 48. The Authority notes that M/s.Anqiu Lu An Pharmaceutical Co., Ltd has exported *** MT of the subject goods directly to India and *** MT through its traders M/s.A.H.A. International Co., Ltd. China Sinopharm International Corporation and Zhejiang Chemicals Import and Export Corporation. The Authority notes that whereas Anqiu Lu An Pharmaceutical Co has reported an export price of US$*(**/MT and A.H.A. International Co., Ltd., China Sinopharm International Corporation and Zhejiang Chemicals Import and Export Corporation have repo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s determined as below: Particulars US$ / Kg - Rs. / Kg. (POI) US$/Kg Rs./Kg Normal Value *** *** Net Export Price *** *** Dumping Margin *** *** Dumping Margin % *** *** Range % 10-20 10-20 b) After details analysis of DGCIS transaction wise data it has been observed that out of total imports of China PR i.e. ***MT***% imports are dumped and ***% are injuries. I. INJURY DETERMINATION AND EXAMINATION OF INJURY AND CAUSAL LINK I.3 Examination of the Authority 55. According to Section 9(A) of the Customs Tariff Act, anti-dumping duty imposed shall, unless revoked earlier, cease to have effect on the expiry of five years from the date of such imposition, provided that if the Central Government, in a review, is of the opinion that the cessation of such duty is likely to lead to continuation or recurrence of dumping and injury, it may, from time to time, extend the period of such imposition for a further period of five years and such further period shall commence from the date of order of such extension. (i) Assessment of Demand / Apparent Consumption 60. The Authority has defined, for the purpose of the present investigation, demand or apparent consump ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ificant degree. In this regard, a comparison has been made between the landed value of the product and the selling price of the domestic industry net of all rebates and taxes, at the same level of trade. The Authority has compared landed price of imports with the selling price of the domestic industry for the subject goods. Particulars Unit POI Landed price of imports from China PR Rs./Kg 250.06 Net Sales Realization Rs./Kg *** Price undercutting Rs./Kg (***) Price undercutting % (***) Range (0-10) From the above, the Authority notes that there is no price undercutting. 65. The domestic industry submitted and opposing interested parties have not disputed that the entirety of the imports were made under advance license and therefore neither customs duty nor ADD was paid on these imports. b. Price Suppression / Depression 66. In order to determine whether the dumped imports are suppressing or depressing the domestic prices and whether the effect of such imports is to suppress prices to a significant degree or prevent price increases which otherwise would have occurred to a significant degree, the Authority considered the changes in the costs and prices o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 5.84 % Import from other countries % 0.16% 0.22% 0.06% 0.11 % Total Demand % 100 100 100 100 74. Performance of the Domestic Industry with regard to profits, return on investment and cash flow is as follows:- Particulars Units 2014-15 2015-16 2016-17 POI Profit / (Loss) Rs./Kg. *** *** *** *** Trend Indexed 100 375 225 325 Cash Profit Rs.Lacs *** *** *** *** Trend Indexed 100 240 165 255 Return on Capital Employed - NFA % *** *** *** *** Trend Indexed 100 173 90 136 75. It is seen from the above table that the profitability, cash profits and return on investments have increased in the POI when compared to he base year/. 80. The Non-injuries price of the subject goods produced by the domestic industry as determined by the Authority in terms of Annexure III to the AD Rules has been compared with the landed value of the exports from the subject country for determination of injury margin during the POI and the injury margin so worked out is as under. SN Particular UOM China (POI) 1 Import Volume MT 2969 2 Non Injurious Price Rs./KG *** 3 Landed Price Rs./KG *** 4 Injury Margin Rs./KG (***) 5 Injury Marg ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . vii. The change in the form of duty from benchmark to fixed quantum has led to reduction in imports. Cessation of anti-dumping duly is likely to increase the imports as significant surplus capacities are available with the producers. The decline in the imports is because of existence of ADD. viii. Due to continuous dumping several plants producing the PRODUCT UNDER CONSIDERATION have been closed down in the country namely :- * M/s.Triton Labratories Ltd. * M/s.Vamsi Labs Ltd. * M/s.Srinivasa Agro Industries & Drugs Ltd. * M/s. Pan Drug * M/s.Alpha Drug * M/s.Glaxosmithkline Pharmaceuticals Ltd. * M/s.Thexa Pharma Pvt. Ltd. * M/s.Vani Pharma Labs Ltd. * Rohini Chemical * Fortune Chemical * Dinesh Pharmaceutical * Dr. Jain's Company * Saboo Medichem ix. The production of product under consideration is quite limited globally. About 86% of global production is in India and China. 62% of the production is in China alone, while India commands 24%. Thus, any sickness in this industry would leave the global demand at the mercy of the Chinese producers. x. The questionnaire responses filed by the exporters, establish that there is import ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is price received by them. xvii. Decline in imports post imposition of duty and positive dumping margin in such imports implies likelihood of dumping in the event of withdrawal of duty and in itself justifies extension of anti-dumping duty. J.2 Submission of exporters 83. There is no likelihood of recurrence of injury as per Article 9A(5) of the Customs and Tariffs Act. i. The petitioners have not given the details of excessive capacity available with the Chinese producers and their likelihood of being exported to India, the petitioners have failed to make out a case of likelihood of dumping. ii. This clearly indicates that there is no likelihood of injury to the domestic industry in the current investigation and the present investigation deserves termination. J.3 Examination by the Authority 84. The Authority examined the likelihood of continuation or recurrence of injury considering the parameters relating to the threat of material injury in terms of Annexure II (vii) of the Anti-dumping Rules. The domestic industry has submitted the details of exports of China to third countries as per China customs which shows that ***% volume of exports to third countries ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the said producer are dumped and ***MT are injurious. (b) Sufficient freely disposable, or an imminent, substantial increase in, capacity of the exporter indicating the likelihood of substantially increased dumped exports to India markets, taking into account the availability of other export markets to absorb any additional export. 89. The Authority evaluated the existing surplus capacities, capacity addition, if any, with the responding exporters, possibility of trade diversion from third countries to India, freely disposable production capacities with the responding exporters. The analysis shows as follows: a. Capacity, production, surplus capacities, exports to India and rest of the world, volume of exports to India. Name of Producer Units Anqiu Lu An Pharmaceutical Co. Ltd. Lianyungang Kangle Pharmaceutical Co., Ltd. Hebei Jiheng (group) Pharmaceutic al Co., Ltd. Total Capacity MT *** *** *** *** Production (POI) MT *** *** *** *** Capacity utilisation % *** *** *** *** Domestic Consumption MT *** *** *** *** Exports to India MT *** *** *** *** Exports to ROW MT *** *** *** *** Total Exports MT *** *** *** *** %Exports ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... *** *** S. Africa (ZA) *** *** *** Iraw (IQ) *** *** *** Zambia (ZM) *** *** *** Russia (RU) *** *** *** Iran (IR) *** *** *** Syrian (SY) *** *** *** Benin (BJ) *** *** *** Mozambique (MZ) *** *** *** United Arab Emirates (AE) *** *** *** Tanzania (TZ) *** *** *** Lithuania (LT) *** *** *** 92. The Authority notes that ***% total volume of exports to third countries is at a price lower than the price at which China export to India. Whereas ***% of the total exports are exported are above at price at which China exports the subject goods to India. (E) Export Orientation of China PR 93. As per the data of China Customs and other evidence filed by the Domestic Industry, the Authority notes that the producers in China are oriented toward exports globally. In the event of cessation of ADD, there is probability that the exporters/producers would resort to dumping of subject goods to India. K. CASUAL LINK AND NON ATTRIBUTION ANALYSIS OF OTHERS KNOWN FACTORS 94. Having examined the existence of continued dumping, volume and price effects of dumped imports on the prices of the Domestic Industr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in injury assessment:- Since this data pertains to the domestic industry, petitioners request disclosure of this data to the petitioners on actual basis. 2. The above is vital for the domestic industry to offer their meaningful comments on the disclosure statement. However, pending such disclosure, the domestic industry hereunder makes following preliminary submissions to the Disclosure Statement. The domestic industry craves leave to make further submissions, as and when the above essential facts are disclosed. B. Emerging essential facts flowing from the Disclosure Statement issued are as follows: 3. Following are the emerging essential facts flowing from the Disclosure Statement. Petitioner believes that the Authority has concluded the following and is making submissions under this belief. Further, petitioner is reproducing some of the facts presented by it earlier only as a matter of reiteration, despite these facts already having been established by the Designated Authority in favor of a positive final determination. i Product under Consideration and Like Article: The product under consideration in the present Sunset Review investigation is Paracetamol and the good ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ls Ingredients (APIs) specifically states that a long term strategy for strengthening API sector by involving Ministry of Commerce as well as other regulator authorities is required which involved judicious and liberal use of measures like anti-dumping. v FICCI report February 2018 edition on "Trends and Opportunities for Indian Pharama" highlights that dependence on China for API supplies exposes the pharma industry to raw material supply disruptions and price volatility. vi Office Memorandum dated 18th April, 2018 issued by the Government of India, Ministry of Chemicals and Fertilizers, Department of Pharmaceuticals, constituted a Task Force to formulate a road map for enhanced production of APIs in the country as there is need for concerted efforts to harness the opportunities in pharmaceutical sector. vii The public at large is already well protected through a regulator mechanism as Paracetamol is covered under National List of essential medicine in Pharmaceutical Policy, 2015. viii Paracetamol is one of the cheapest API available in the country. By other Interested Parties: i The anti-dumping duties against the import of subject goods are in existence for mor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rcially substitutable since they are being used interchangeably by the consumers. Therefore, the goods produced by the Domestic industry and imported from the subject country are like articles in terms of the Rule 2(d) of the Anti-Dumping Rules. E. Scope of the Domestic Industry & standing 8. With regard to the scope of the Domestic industry & Standing the Designated Authority has rightly at Para. 23 have noted that the petitioner companies are eligible domestic industry in terms of AD Rules. Further. production of the petitioner companies namely M/s Farmson Pharmaceuticals Gujarat Private Limited and M/s Sri Krishna Pharmaceuticals Limited constitutes "a majo proportion of total Indian production" and hence, satisfies the standing requirements for the subject goods under Rule 2(b) and Rule 5(3) of the AD Rules. it is further submitted that at Para.22 of Disclosure Statement the Authority has noted that M/s Bharat Chemicals has provided all the necessary information. However, the Authority has not considered the same as the Designated Authority considers that the same was filed at belated stage of investigation. 9. It is submitted that the Designated Authority at Para. 22 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s to arrive at NEP. In this case it should be unrelated exporter should have made the exports at profits. In case exporter has posted losses (as verifies from appendix 5&9) then a reasonable profit has to be deducted for computation of ex factory export price" 14. Therefore in a case like present where the producers have exported the goods through unrelated trader and where it does not appear a case that the traders have made losses, the export price should be determined considering the selling price of the producer. 15. Even otherwise, the petitioners submit that the export price reported by the producers should be rejected and export price reported by the trader/exporter should be adopted only when it is found that the trader has sold the product at a lower price. As noted in the SOP manual, only in a case where the traders suffer a loss, the selling price of trader can be adopted. However, if traders earn profits. the selling price of producer should be adopted. 16. The export price determined is therefore not appropriate. Dumping margin 17. Designated Authority at Para. 52 (b) has rightly noted that out of total imports of China PR i.e.*** MT "* % imports ar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rce. Further, this only shows absence of current injury and in itself insufficient to hold absence of likelihood. iii At Para 77 of the Disclosure Statement Designated Authority has rightly noted that the average inventory level of the subject goods has shown an increasing trend. Injury Margin 23. Without prejudice, it is submitted that injury margin is not germane to likelihood of dumping and injury analysis. NIP is determined only for the purpose of quantification of duty, and is not relevant for the determination regarding existence of injury or likelihood thereof. Rule 17(2) to the Rules also makes it evident that the question of quantum of injury shall arise only when the Designated Authority finds injury to the domestic industry:- [(b) recommending the amount of duty which, if levied, would remove the injury whereapplicable, to the domestic industry after considering the principles laid down in the Annexure III to these rules] 24. Similar view has been held by the Hon'ble Court in matter of Nirma Ltd. v. Union of India 2017(358) E.L.T. 146 (Guj) that injury margin and NIP is determined only for the purpose of quantification of duty, and is not relevant for the det ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y, like in the present case, the Designated Authority is not required to and should not determine injury margin. In fact, when there is no injury, there can be no need for determining injury margin. And, a negative injury margin only shows that the domestic industry is not suffering current injury. Therefore, in a situation where the Designated Authority finds absence of injury, the Designated Authority is not required to determine injury margin and proceeds with the investigation and issue finding based on likelihood analysis. and confirm the same quantum of ADD, which is required to be done in the present case. 26. In the past also Designated Authority has not modified the quantum of ADD both in MTR and SSR when the Designated Authority found that the need for continuation/extension is based on likelihood of injury. Domestic industry refers to the following illustrative cases where the Designated Authority declined to modify the quantum of ADD and merely extended existing ADD. In some of these cases, the injury margin was found negative in the review investigation period. S N NAME OF THE CASE INJURY DUTY IMPOSED 1 Zinc Oxide from China PR No Injury Continuation of defi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... panies do not have their own production facilities and they quote the capacity of the producers on their websites. iii Authority at Para. 90 have noted that on the basis of "the questionnaire response filed by the Chinese producer's shows that level of inventories with the cooperative producers/ exporters is quite significant. iv Authority at Para. 91 have noted that "..export' from China PR to the rest of the world indicate that with the revocation of ADD the Indian prices would be attractive for the Chinese producers/Exporters to increase their exports to India" v As rightly noted by the Authority at Para. 93 of the Disclosure statement that "the producers in China are oriented towards exports globally. In the event of cessation of ADD there is probability that the exporters/producers would resort to dumping of subject goods to India". 30. The above disclosure of various parameters clearly indicates that in a situation like present, the anti dumping duty needs to be extended. J. Causal link and Non Attribution Analysis of Other Known Factors 31.Under the provisions of law the Designated Authority is required to undertake a non-attribution analysis, wherein, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sufficient injury margin 34. The non injurious price determined is too low resulting into negative injury margin. The non injurious price has been reduced on account of number of factors. The domestic industry requests the authority to kindly consider the followings with regard to Capital Employed. 35. Capital employed should be determined considering present value of fixed assets, or at the least gross value of fixed assets. in any case, adoption of net fixed assets is highly inappropriate and. in fact. unfair to the domestic industry, considering that some of the investments are significantly old and therefore net fixed assets does not represent true value of investments. In fact, the most appropriate value for the purpose is present value of the investments. L. Period for which Anti dumping is imposed is not relevant 36. As already submitted by the petitioner that anti dumping duty is required to be imposed so long as the investigation shows that the cessation of such duty is likely to lead to continuation or recurrence of dumping and injury. The Act and the Rules do not prescribe any time limit beyond which the anti dumping duty should not be extended. Section 9A(5) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n-alloy steel Pipe Mexico 11/2/1992 26 23 8 Clad Steel Plate Japan 7/2/1996 22 56 9 Crawfish Tail Meat China 9/15/1992 26 36 10 Freesh Garlic China 11/16/1994 24 19 11 Furfuryl Alcohol 6/21/1995 23 60 12 Glycine China 3/29/1995 23 83 13 Granular Polytetrafluoro ethylene Resin Italy 8/30/1988 30 41 14 Gray Portland Cement & Clinker Japan 5/10/1991 27 72 15 Hammers & Sledges China 2/19/1991 27 93 16 Helical Spring Lock Washer China 10/19/1993 25 27 17 Helical Spring Lock Washer Taiwan 6/28/1993 25 58 18 Potassium Permanganate China 1/31/1984 34 99 19 Petroleum Wax Candles China 8/28/19856 32 42 20 Porcelain-onsteel Cooking Ware China 12/2/1986 32 15 21 Iron Construction Casting Canada 3/5/1986 32 90 22 Iron Construction Casting China 5/9/1986 32 72 23 Light-walled Rectangular Pipe Taiwan 3/27/1989 29 84 24 Paper Clips China 11/25/1994 24 17 25 Pasta Italy 7/24/1996 22 50 87. Canada has extended anti-dumping duties in following cases. It would be seen that some of these duties are in force for the past 20-25 years. S n Product Country Duty since Time period Year ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uct under consideration forms majority of the cost of Paracetamol formulation, there is an automatic; check on the prices at which the producers of the product under consideration can sell the product in the market. The Authority further notes that Paracetamol .is listed under National List of Essential Medicines and it is one of the cheapest pain killer being most widely used in the Country. Thus, while the price of both formulation and bulk drug are capped, the producers of Paracetamol have been selling the product at a price listed to regulated product. d. Paracetamol is not a high cost medicine and therefore in any case there should be no concern with regard to possible adverse impact of the ADD on the consumers. In any case, impact of present ADD on the consumer is miniscule. e. While the ADD has been in force for more than 15 years, the domestic industry was effectively protected only for last five years, which period has seen significant growth in the Country and the domestic industry requires protection for at least another five years, after which the domestic industry is expected to be fully viable M. Prayer 37. In the light of the contentions raised. informati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... terms of the Rule 2(d) of the Anti-Dumping Rules. The two are technically and commercially substitutable. The consumers are using the two interchangeably. E. ISSUES RELATING TO CONFIDENTIALLY E.1 Submissions by the Domestic industry 24. The domestic industry has made the following submissions:- i. The exporter/producers have made unnecessary claims as to confidentially or provided incomplete information thereby handicapping the domestic industry in making meaningful comments with regard to the responses filed. The responses me not properly indexed or summarized. ii. Information provided in non-confidential version is beyond understanding. The NCV does not provide clear understanding of the data and the domestic industry is unable to provide detailed comments on that for the same reason. iii. Non - confidential version of the questionnaire responses is grossly inadequate incomplete. The concerned interested party has not disclosed all such information that they are obligated to disclose under the Rules and practice being followed by the Designated Authority in this regard. E.2 Submissions by the exporters/importers/other interested parties 25. The exporters/ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ty in the course of investigation, shall, upon the designated authority being satisfied as to its confidentiality, be treated as such by it and no such information shall be disclosed to any other party without specific authorization of the party providing such information. (2) The designated authority may require the parties providing information on confidential basis to furnish non-confidential summary thereof and If in the opinion of a party providing such information, such information is not susceptible of summary, such party may submit to the designated authority a statement of reasons why summarization is not possible. (3) Notwithstanding anything contained in sub-rule (2), if the designated authority is satisfied that the request for confidentiality is not warranted or the supplier of the information is either unwilling to make the information public or to authorize its disclosure in a generalized or summary form, it may disregard such information. 27. Submissions made by the interested parties with regard to confidentiality and considered relevant by the Authority are examined and addressed accordingly. Information provided by the interested parties on confidential ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of import of the article from a country other than the country of origin and where the article has been merely transhipped through the country of export or such article is not produced in the country of export or there is no comparable price in the country of export, the normal value shall be determined with reference to its price in the country of origin. G.1 Views of the Domestic industry 41. The following are the submissions made by the domestic industry, during the course of present investigation and considered relevant by the Authority:- i China needs to be treated as non-market economy for the reason that the costs and prices in China do not reasonably reheat the market forces. Para 8 to Annexure-I specifies the parameters which should be considered for grant of market economy status. This also implies that unless these conditions are not fulfilled/satisfied, the Chinese costs and prices cannot be adopted. ii. Chinese producers are required to be treated as companies operating under non-market economy environment and the Authority may proceed to determine the normal value on the basis of Para 7 of Annexure-I. iii. The imports are entering the Indian market at d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hinese exporters on the basis of their records without following any additional procedure, domestic industry has arbitrarily determined the normal value for Chinese exporters without following the due procedure as laid down under the Indian Anti-dumping Rules. vii. The constructed normal value proposed by the domestic industry is based on the cost of production in India and considering the rate of profit at 5%. However, the item-wise cost details of the constructed normal value have not been provided. viii. The methodology of relying upon the Indian costs and prices is to be followed only when it was not possible to construct the normal value on the basis of other alternatives prescribed in the opening sentence of Para 7. ix. In terms of the provisions of Para 7, the market economy third country is required to be first identified for determination of normal value and only where it is not possible to obtain necessary data from such third country, the normal value can be determined on any other reasonable basis, including the price actually paid or payable in India for the like product, duly adjusted if necessary, to include a reasonable profit margin. x. The domestic ind ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 46. The Authority has, therefore, constructed the normal value for China PR on the basis of cost of production in India, duly adjusted, including selling, general and administrative expenses Accordingly, the constructed normal value for Chinese exporters is determined Rs. ***** per Kg. c. Determination of export price of China PR 47. The Authority notes that exporters mentioned below from China PR have furnished information to the Authority, which was used for determination of export price and individual dumping margin. i. M/s Anqiu Lu An Pharmaceutical Co., Ltd. ii. M/s A.H.A international Co., Ltd. iii. China Sinopharm international Corporation iv. Zhejiang Chemicals Import and Export Corporation v. Lianyungang Kangle Pharmaceutical Co., Ltd. vi. Zhejiang Kanglc Pharmaceutical Co., Ltd. vii. Hebei Jiheng (group) Pharmaceutical Co. Ltd. In view of the responses filed, the Authority has analysed the response made by the producers /exporters as follows: M/s Anqiu Lu An Pharmaceutical Co. Ltd. (Producer) and M/s A.H.A International Co. Ltd . China Sinopharm International Corporation and Zhejiang Chemicals Import and Export Corporation 48. The Aut ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... njurious. Para H. INJURY DETERMINATION AND EXAMINATION OF INJURY AND CASUAL LINK (II) Volume Effect of Dumped Imports and impact on Domestic Industry: Import volume and Market Share. 62. With regard to volume of the dumped imports, the Authority is required to consider whether there has been a significant increase in dumped import either in absolute terms or relative to production or consumption in India. The table below summarizes the factual position with regard to import volumes and market share-: 63. It is seen that the import volume declined till 2015-16 and increased thereafter. Also, the market share in demand of the domestic industry has remained more or less constant. 70. Production, sales, capacity & capacity utilization details are as follows:- Particulars Unit 2014-15 2015-16 2016-17 POI Capacity MT *** *** *** *** Trend Indexed 100 100 100 100 Production MT *** *** *** *** Trend Indexed 100 103 111 126 Capacity Utilization % *** *** *** *** Trend Indexed 100 103 111 126 Domestic Sales for PUC MT *** *** *** *** Trend Indexed 100 113 116 117 From the above information, the Authority notes the followi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e dumping would recur in the event of revocation of antidumping duties; c) Whether the Domestic Industry continued to suffer injury; and if so, whether injury to the domestic industry is likely to continue; (d) In case where the Domestic Industry has not suffered continued injury, whether injury to the Domestic Industry is likely to recur in the event of revocation of antidumping duties. ii. The original investigation and the subsequent Sunset Review investigations also established the existence of significant dumping. The dumping margin in the previous as well as the first SSR was quite high. iii. There is a long history of dumping of subject goods from China in domestic market as well as in other countries such as South Africa and Indonesia. iv. The continued dumping was only reduced after the last concluded sunset review investigation. Prior to that, the domestic industry was suffering continued injury on account of significant dumped imports, as stated by the Authority in the final findings earlier notified in the review cases. v. The significant level of these imports only started declining since 2015-16. However, it is pertinent to note that the domestic ind ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y to utilize these unutilized capacities and flood the Indian market. xiii. The foreign producers are export oriented. in as much as their capacities are far more than the domestic demand in the subject country. The production of the subject goods in subject country is in the range of l lac MT, as against 2.21 lac MT capacities; whereas the domestic demand for the product in China is far lower nearly 20,000 MT. This clearly shows that the exporters have built up capacities in excess of the demand in the subject country out of 1 lac MT production, about 80% are meant for exports. xiv. The exporters have not only been dumping in India, but also in other countries. Further, the prices at which the goods have been supplied to these countries are lower than the non-injurious price. It is therefore, reasonable to conclude that the exporters are likely to sell at dumped and injurious prices in India as well in case the duty is revoked. xv. The export price from subject country to various countries globally are far lower than the export price to India in respect of significant proportion of exports from subject country to various countries globally. The dumping margin and injury m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... orter indicating the likelihood of substantially increased dumped exports to Indian markets, taking into account the availability of other export markets to absorb any additional exports; c. Whether imports are entering at prices that will have a significant depressing or suppressing effect on domestic prices, and would likely increase demand for further imports; and d. Inventories of the article being investigated. 86. A significant rate of increase of dumped imports into India indicating the likelihood of Substantially increased importation. Particulars Units 2014-15 2015-16 2016-17 POI China MT 4356 1930 2205 2969 Others MT 79 115 30 65 Total Imports MT 4434 2045 2235 3034 * April 17 to March 18 87. The Authority notes that there was a consistent decline in the volume of imports compared to base year. 88. An analysis of transaction wise date of the cooperative producers with their respective exporters so as to arrive at dumped and injurious imports of the cooperative producer of the present investigation is as follows:- a) M/s Anqiu Lu An Pharmaceutical Co., Ltd. The total exports to India by the said producer with trade of the subj ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the article being investigated 90. The questionnaire response filed by the Chinese producer's shows that level of inventories\ with the cooperative producers/exporters is quite significant. Producer Units 2015 2016 2017 POI M/s. Anqiu Lu An Pharmaceutical Co. Ltd. MT *** *** *** *** Lianyungang Kangle Pharmaceutical Co., Ltd MT *** *** *** *** Hebei Jiheng (group) pharmaceutical Co. Ltd. MT *** *** *** *** Total MT *** *** *** *** (D) Price attractiveness of Indian market 91. Analysis of the China PR Custom data with regard to export from China PR to the rest of the world indicate that with the revocation of ADD, the Indian prices would be attractive for the Chinese producers/exporters to increase their exports to India and the same can be deduced from the table given below: Country Quantity (Kg) Value (USD) Price USD/kg India (IN) *** *** *** Congo, DR *** *** *** Cuba (CU) *** *** *** Kenya (KE) *** *** *** Mauritius (MU) *** *** *** Indonesia (ID) *** *** *** S. Africa (ZA) *** *** *** Iraw (IQ) *** *** *** Zambia (ZM) *** *** *** Russia (RU) *** *** *** Iran (IR) *** *** *** Syrian (S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nti-Dumping Duty as referred to above in initial part of the order. (xxx) On 10.06.2019, Respondents No.1 to 3 have issued Notification No.22/2019-Customs (ADD) extending the Anti-Dumping Duty upto 24.06.2019. (xxxi) On 11.06.2019, the petitioners did not press I.A. No.2 of 2019. (xxxii) On 20.06.2019, a final hearing was conducted and this Court has passed order for issuance of Notification for extension of Anti-Dumping Duty till 09.07.2019. 14. The Court is called-upon to examine the rival contentions of the parties, which needs to be examined in light of the aforesaid indisputable aspects set-out hereinabove. The position of law in respect of the remedies on final findings is now clear. The respondents have relied on the following decisions for their contentions that the alternative remedy in terms of Section 9C of the Act may persuade this Court in not interfering with the final findings. 1. Designated Authority Vs. Sandisk International Ltd, (2018) 13 SCC 402 - the Supreme Court set aside the judgment of Delhi High Court allowing a Writ Petition and held that the final findings of the designated authority cannot be challenged under Article 226 of the Constitution ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ss such orders thereon as it thinks fit, confirming, modifying or annulling the order appealed against. (4) The provisions of sub-sections (1), (2), (5) and (6) of section 129C of the Customs Act, 1962 (52 of 1962) shall apply to the Appellate Tribunal in the discharge of its functions under this Act as they apply to it in the discharge of its functions under the Customs Act, 1962 (52 of 1962). (5) Every appeal under sub-section (1) shall be heard by a Special Bench constituted by the President of the Appellate Tribunal for hearing such appeals and such Bench shall consist of the President and not less than two members and shall include one judicial member and one technical member. The counsel for the petitioner contended that sub-Section-3 of Section-9C of the Act does not provide any express authority and power or jurisdiction in the tribunal to issue direction to the Union of India for issuing notification extending the anti dumping duty. In other words, sub- Section-3 of Section-9C provides that the appellate tribunal may pass such orders as it thinks fit confirming, modifying or annulling the order appealed as against in an eventuality like present where the challe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ituation jeopardizing the entire matter without adjudication. If one looks at from this angle, then one will have no other alternative but to accept the submission of learned counsel for the petitioner that the alternative remedy of appeal u/s.9C of the Act at-least in facts of the present case cannot be said to be so efficacious as to dissuade this Court from entertaining the petition and relegating the parties to the appellate forum. 15. In the case of Designated Authority Vs. Sandisk International Limited reported in (2018) 3 SCC 402, the Supreme Court has held and observed in para-6 as under:- "6. Though we would not deem it appropriate to lay down any inflexible proposition of law that in no case the final findings of the Designated Authority can be subject to challenge under Article 226 of the Constitution of India, we are of the view that in the facts of the present case the High Court was not justified in exercising its jurisdiction and in setting aside the final findings of the Designated Authority." 16. Thus, there is no inflexible proposition of law that in no case, the final findings of the Designated Authority can be subject to challenge under Article 226 of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ch as, a draft order would also contain conclusions on whether or not definitive measures are required to be applied. 32. The next question that arises for consideration is whether or not the essential facts have been disclosed in the disclosure statement. 32.11 Thus, the designated authority has taken into consideration the aforesaid factors while coming to the conclusion as to whether or not definitive measures are required to be applied. In this regard, it may be noted that the designated authority has not disclosed the details of dumping margin calculations to the petitioner, viz., the difference between the Export Price and Normal Value. The designated authority has not disclosed the basis for determining Normal Value and Export Price and has also not disclosed the methodology and computation. The designated authority has considered the value of Cost of Sales and Selling Price based on the data submitted by the domestic industry, but has not disclosed what data has been used by it while determining the price suppression and price depression effect. While determining the price undercutting, the value for Net Sales Realisation is calculated on the basis of data provided by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s of the present case, despite the fact that the information has been furnished by the domestic industry itself, the computation of the various factors referred to hereinabove, has not been furnished to the domestic industry. In the opinion of this court, it was incumbent upon the designated authority to furnish the relevant facts which have been used by it as the basis for arriving at its conclusion on the essential facts necessary for the purpose of arriving at a decision as to whether or not the definitive measures are required to be applied. Non-disclosure of the essential facts is, therefore, clearly in breach of the principles of natural justice. 33.7 Thus, though most of the factors which are required to be taken into consideration for the purpose of determination of injury, namely, increase in volume, increase in dumping, increase in margin of dumping and price undercutting are all positive and only price suppression and price depression are absent, the designated authority, instead of relying upon the said factors for the purpose of basing his decision as to whether or not to continue with the determinative measures,has placed reliance upon an irrelevant factor, viz., i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e procedure laid down under clause (vii) of Annexure-II to the rules for the purpose of determination of threat of material injury in the manner prescribed thereunder. 17.1 In the case of Reliance Industries Limited Vs. Designated Authority (supra), the Supreme Court has held and observed in paras-41, 43, 44 and 45 as under:- "41. The DA claimed confidentiality from the appellant about its finding on the data supplied by the appellant itself. In our opinion, there was nothing confidential in the mater, and hence reasons for not accepting the appellant's version should have been stated in the order of the DA. 43. In our opinion, Rule 7 does not contemplate any right in the DA to claim confidentiality. Rule 7 specifically provides that the right of confidentiality is restricted to the party who has supplied the information, and that party has also to satisfy the DA that the matter is really confidential. Nowhere, in the rule has it been provided that the DA has the right to claim confidentiality, particularly regarding information which pertains to the party which has supplied the same. In the present case, the DA has failed to provide the detailed costing information to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of confidentiality defeats the right to appeal. In the absence of knowledge of the consequences, grounds, reasoning and methodology by which the DA has arrived at its decision and made its recommendation, the parties to the proceedings cannot effectively exercise their right to appeal either before the Tribunal or this Court. This is contrary to the view taken by the Constitution Bench of this Court in S. N. Mukherjee case. 17.2 In the case of Union of India Vs. Meghmani Organics Limited (supra), the Supreme Court has held and observed in paras-14, 15, 16 and 19 as under:- 14. Elaborating his points further, learned senior counsel for the Union of India submitted that the very opening sentence of above quoted para 43 lays down an incorrect proposition of law that Rule 7 does not permit the DA to claim confidentiality and that right to make such a claim is vested only in a party who has supplied the particular information. The use of the term 'any party' in the opening sentence of Rule 7(1) in place of the expression 'interested party', according to learned counsel, indicates that the DA may receive in course of his suo motu action certain confidential informations and in such ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ding factor for the DA who cannot by exercise of discretion presume confidentiality and thereby restrict the rights of the interested parties to see relevant informations that may be used by the DA for the investigation. The DA, being a statutory investigator, cannot assume for himself the role of a party for the purpose of Rule 7 and to claim as well as accept on information to be confidential. 16. The other reason is provision of appeal under Section 9C of the Act. The appeal provided is against the order of determination or review thereof regarding the existence, degree and effect of any subsidy or dumping in relation to import of any article. It is one thing to use confidential information for the purpose of investigation on account of statutory provisions and not communicating the same. It is quite another, not to maintain transparent records of reasons as to why claim of confidentiality made by any party has been accepted by the DA. Where appeal is provided, the appellate authority will definitely be entitled to look into the records including the confidential information as well as into the correctness of the decision for accepting a claim of confidentiality. The situatio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ervations on non issues. Reference in this regard may be made to law enunciated on this point by a Constitution Bench, in paragraph 20 of the judgment in the case of Krishena Kumar v. Union of India & Ors. [7] In the given facts, the observations in paragraph 43 in the case of Reliance Industries are fully justified and do not require any review. We are in agreement that Rule 7 does not postulate that the DA can claim confidentiality and that too not in respect of any information supplied by a party but in respect of its reasons or findings derived from information supplied by the same very party. 17. Considering the matter on merits, it is required to be noted, at this stage, that the submissions advanced on behalf of the petitioners, which have been set out herein above, have hardly been refuted by the respondents in proper manner. The respondents by and large have contended that the authority has observed principles of natural justice and afforded all the informations to the petitioners and afforded full opportunity for rendering final findings. It is the main contention of the petitioners that the conclusion reached in final finding is diametrically opposed in the observatio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ificant import as per Rule 14(d). Thus, the observations made by the DA is misreading of the facts and the DA has not properly appreciated this very observation while reaching in the conclusion in Final Finding and this fact is corroborated from the Final Finding itself. 19. It also appears from the record that the authority has made observations regarding likelihood of substantially increased dumped exports to Indian market, taking into account the availability of other export markets to absorb any additional exports from paragraph Nos.85, 90, 91, 92 and 93 at page Nos.273 to 277 and has specifically observed therein that - (I) Considering the capacity utilization and export orientation of the responding producers and evidence provided by the domestic industry, it is evident that there are surplus capacities in China and the Chinese producers are export oriented. (II) The questionnaire response filed by the Chinese producer's shows that level of inventories with the cooperative producers / exporters is quite significant. (III) Analysis of the China PR Custom data with regard to export from China PR to the rest of the world, indicate that with the revocation of ADD, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... observations made by the DA is misreading of the facts and the DA has not properly appreciated this very observation while reaching in the conclusion in Final Finding and this fact is corroborated from the Final Finding itself. 21. It also appears from the record that the authority has made observations regarding likelihood of substantially increased dumped exports to Indian market, taking into account the availability of other export markets to absorb any additional exports from paragraph Nos.85, 90, 91, 92 and 93 at page Nos.273 to 277 and has specifically observed therein that - (I) Considering the capacity utilization and export orientation of the responding producers and evidence provided by the domestic industry, it is evident that there are surplus capacities in China and the Chinese producers are export oriented. (II) The questionnaire response filed by the Chinese producer's shows that level of inventories with the cooperative producers / exporters is quite significant. (III) Analysis of the China PR Custom data with regard to export from China PR to the rest of the world, indicate that with the revocation of ADD, the Indian prices would be attractive for the Ch ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... data. Whenever any information is made available on website by any particular entity then it will amount to available on public domain which has been recorded by the DA from the data of DGCIS is also a breach of Rules and there is detailed information given to the petitioners herein. 25. It appears from the record that after Disclosure Statement, the petitioners herein have sought certain informations which are not confidential in nature, which have not been supplied by the DA to the petitioners and thus, there is also breach of principles of natural justice. Considering the facts narrated in the Disclosure Statement and Finding and ultimate conclusion, it clearly appears that the DA has not properly appreciated the material placed on record and has not averted all the facts of likelihood of dumping and injury to the DI and there is non-advertence to the requisite material placed on record and non-consideration of the facts recorded earlier and there is merely a foundation of reading to the conclusion in final finding, diametrically opposed to the facts observed in the Disclosure Statement and final findings, which render the final findings not tenable in the eye of law as the fi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... been submitted by them after Disclosure Statement, in its proper perspective and, thereafter, the authority has to pass final finding order. This course has to be adopted with a view to afford proper opportunity to all the parties and to evaluate, examine and appreciate the material supplied by the concerned parties to the DA regarding Disclosure Statement and after making such exercise by DA, necessary Final Finding may be arrived at by DA either to positive opinion or negative one continuation. 28. The law in respect of the final findings and its justiciability is no more res-integra and one can say that under Article 226 of the Constitution of India when final findings are assailed on the grounds mentioned in the submissions viz. Omissions on the part of the authority in considering the detailed put forward by the petitioner, the High Court could interfere in the matter. The omission by the designated authority in disclosing the material which is not claimed to be confidential and the omission to follow the methodology in light of the decision in respect of Rule-7 as held by Supreme Court in case of Reliance Industries Ltd., Vs. Designated Authority reported in 2006 (10) SCC ..... X X X X Extracts X X X X X X X X Extracts X X X X
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