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TMI Blog2023 (5) TMI 613X X X X Extracts X X X X X X X X Extracts X X X X ..... h compatible non-clad aluminium foil, the appellant had requested the designated authority to provide detailed descriptions of the said exclusions mentioned in the said customs notification rather than merely referring the customs notification number for excluding the products. It needs to be noted that the Manual of Standard Operating Practices for Trade Remedy Investigations issued by the Directorate General of Trade Remedies, Department of Commerce, Government of India provides in Article 3.10 that mere competence without any production or merchant sales may not be sufficient, to include an item in the definition of the product under consideration - thus, an item which has not been sold by the domestic industry in commercial quantities should not be included in the scope of the product under consideration by the domestic industry. What, however, transpires is that the domestic industry could not demonstrate that it had made any commercial supplies of clad with compatible non-clad aluminium foil during the period of investigation and that clad with compatible non-clad aluminium foil cannot be considered as flat rolled products of aluminium since the cladded coil is made of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... missions to the alternative prayer. 3. It transpires from the records that Hindalco Industries Limited [Hindalco], which has been impleaded as respondent no. 3 in this appeal, had filed an application before the designated authority on behalf of the domestic industry under the provisions of the Customs Tariff Act, 1975 [the Tariff Act] and the Customs Tariff (Identification, Assessment and Collection of Anti-dumping Duty on Dumped Articles and Determination of Injury) Rules, 1995 [the 1995 Rules] for initiation of anti-dumping investigation on the imports of certain flat rolled products of aluminium originating in or exported from China PR [the subject country]. The investigation was initiated by the designated authority by a notification dated 08.09.2020 to determine the existence, degree and effect of the alleged dumping and to recommend the amount of anti-dumping duty, which, if levied, would be adequate to remove the injury to the domestic industry. The investigation was conducted for the period from 01.04.2019 to 31.03.2020 and the injury analysis period was notified to be from 01.04.2016 to 31.03.2019 and the period of investigation. The designated authority provided an op ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nvestigation. c) The material injury suffered by the domestic industry has been caused by the dumped imports. M. RECOMMENDATION 128. The Authority notes that the investigation was initiated and notified to all the interested parties and adequate opportunity was given to the domestic industry, the exporters, the importers and the other interested parties to provide information on the aspects of the dumping, the injury and the causal link. Having initiated and conducted the investigation into dumping, injury and causal link in terms of the provisions laid down under the Rules, the Authority is of the view that imposition of anti-dumping duty is required to offset the dumping and the injury. Therefore, the Authority recommends imposition of the anti-dumping duty on the imports of subject goods originating in or exported from the subject country. 129. Having regard to the lesser duty rule followed by the Authority, the Authority recommends imposition of the anti-dumping duty equal to the lesser of the margin of dumping and the margin of injury so as to remove the injury to the domestic industry. The Authority, therefore, considers it necessary to recommend imposition of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... compatible non-clad aluminium foil from the scope of the product under consideration in the final findings and the customs notification. 7. The product has a history of anti-dumping investigations. The earlier investigations were on aluminium foil up to 80 micron thickness. The present investigation is on certain flat rolled products of aluminium. Aluminium foil is a subset of certain flat rolled products of aluminium. 8. The first anti-dumping investigation for the period April 2014 to March 2015 was initiated on 15.12.2015 on aluminium foil from 5.5 micron to 80 micron from China PR based on the application by the domestic industry including Hindalco. In the final findings issued on 10.03.2017 and the customs notification issued on 16.05.2017 clad with compatible non-clad aluminium foil was excluded from the product. 9. The second anti-dumping investigation for the period April 2019 to March 2020 was initiated on 20.06.2020 on aluminium foil of 80 micron and below from China PR, Indonesia, Malaysia and Thailand based on the application by domestic industry including Hindalco. Clad with compatible non-clad aluminium foil was excluded in the final findings dated 18.06.202 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lled Clad 1 and Clad 2 layers, which are aluminium-silicon alloy layers having silicon content in the range of 6.8% to 8.2%. The middle layer is the core layer with very high aluminium content (more than 95%) and other minor elements. These three layers are produced by rolling process and are independently flat rolled products of aluminium. Thereafter, all the three layers i.e. the clad layers and the core layer (which is unclad) are metallurgically bonded to form a cladded coil. All the three layers must be compatible with each other, which is why the description is 'clad with compatible non-clad aluminium foil. Thus, a cladded coil or clad with compatible non-clad aluminium foil is not a simplicitor flat rolled product of aluminium, but it is a coil which has been manufactured out of three flat rolled products of aluminium. There can also be a cladded coil with clad layer on one side, where the clad layer is metallurgically bonded with the core layer. 15. It needs to be noted that the present investigation was only on certain flat rolled products of aluminium and not on products that are manufactured out of flat rolled products of aluminium. 16. It also needs to be no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... said Notification. In case the exclusion is defined with reference to the Customs Notification and Final Findings, it may create a confusion that the products which do not attract duty under the said Notification, will be covered in the present investigation. In order to avoid any such ambiguity, we request the Authority to exclude the products by providing their detailed description and not by mere reference to the Customs Notification and Final Findings. 19. Since the customs notification 16.05.2017 already excluded several articles including clad with compatible non-clad aluminium foil, the appellant had requested the designated authority to provide detailed descriptions of the said exclusions mentioned in the said customs notification rather than merely referring the customs notification number for excluding the products. 20. In response to the specific request of the appellant, the domestic industry admitted that they do not object to a clarification from the designated authority with respect to the items that are excluded by customs notification dated 16.05.2017, but the domestic industry submitted that clad with compatible non clad aluminium foil should be included in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... submitted that it can manufacture Unclad Finstock, Unclad Coil and Cladded Coil for Header Plate and End Plate. 32. With respect to the quality of products, the Authority reiterates that quality issues cannot be grounds for exclusion in an antidumping investigation. 33. Therefore, the Authority has determined not to exclude such a product from the scope of the PUC. 23. The contention of the learned counsel for the appellant is that the designated authority could not have rejected the product exclusion merely because the domestic industry can manufacture clad with compatible non-clad aluminium foil. It was imperative for the designated authority to have examined whether the domestic industry had made commercial supply of clad with compatible non-clad aluminium foil during the period of investigation. The domestic industry also failed substantiate that it had made commercial supplies of clad with compatible non-clad aluminium foil in commercial quantities during the period of investigation. 24. In regard to the notification dated 16.05.2017 issued by the Central Government for the first anti-dumping investigation, the Bombay High Court in Mahle Anand Thermal Systems Priv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... require clad with compatible non clad aluminium foil which is used in heat exchangers used specifically only in radiators in vehicles and engines in cooling systems. This is excluded by petitioner. 6. Further, Para 79 clearly mention that the following is excluded from the scope of PUC. Aluminium - Manganese - Silicon based and/or clad Aluminium - Manganese - Silicon based alloys, whether clad or unclad: with post brazing yield strength greater than 35 MPA, falling under tariff heading 7607 for use in heat exchangers including radiators, charge air coolers, condensers, oil coolers, heater cores, evaporators, heat ventilation and air conditioning (HVAC) systems and parts thereof. 7. The Final Finding is Comprehensive and the exclusion is candidly mentioned in relevant portions of the Final Findings. ***** 13. Subsequently, there is a clarification issued by the Directorate General of Anti-Dumping and Allied Duties on 1st February, 2018 which is quoted earlier. Therefore, it is quite clear that clad as well as clad with compatible non-clad or unclad aluminium foil has been excluded from anti-dumping duty . Respondent No.4 therefore was not justified in insisting ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . 28. What, however, transpires is that the domestic industry could not demonstrate that it had made any commercial supplies of clad with compatible non-clad aluminium foil during the period of investigation and that clad with compatible non-clad aluminium foil cannot be considered as flat rolled products of aluminium since the cladded coil is made of several surface layers of flat rolled products of aluminium that are metallurgically bonded to high strength aluminium alloy core. 29. In view of the aforesaid, it is not possible to hold that clad with compatible non-clad aluminium foil should not be excluded from the scope of product under consideration as has been contended by learned counsel for some of the respondents for the reason that the imported article is a like article under investigation or that Hindalco has the capability and has produced and sold clad with compatible non-clad aluminium foil. 30. For the reasons stated above, clad with compatible non-clad aluminium foil has to be excluded from the product under consideration and, accordingly, the customs notification dated 06.12.2021 is modified to exclude clad with compatible non-clad aluminium foil from the sc ..... X X X X Extracts X X X X X X X X Extracts X X X X
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