2005 Supreme(SC) 331

2005(2) Supreme 526
Supreme Court of India
(From Central Excise, Customs and Gold (Control) Appellate Tribunal, New Delhi)
Mrs. Ruma Pal, Arijit Pasayat & C.K. Thakker, JJ.
Shenyang Mastsushita S. Battery Co. Ltd. —Appellant
versus
M/s. Exide Industries Ltd. & Ors. —Respondents
Civil Appeal No. 6371 of 2003
Decided on 23-2-2005
Counsel for the Parties :
For the Appellant : Ms. Meenakshi Arora, Dr. Aman Hingorani, Ms. Priya Hingorani, Ms. Reema Bhandari, Advocates.
For the Respondents : R.F. Nariman and T.S. Doabia, Sr. Advocates, Ms. Manu Nair, Dhruv Dewan, Manish Sharma and D.S. Mahara, Advocates.

Important point
The principle behind anti dumping laws is to protect the domestic industry from being adversely affected by import of goods at export prices which are below the normal value of the goods in the domestic market of the exporter.

Headnote:Customs Tariff Act, 1975—Section 9A—Customs Tariff (Identification, ­Assessment and Collection of Anti Dumping Duty on Dumped Articles and for Determination of Injuries) Rules, 1995—Assessment of anti dumping duty—Principles to be followed by the Designated Authority for determination of normal value of non market economies—Respondents 1 and 2 representing the domestic industry which either manufactures or imports lead acid batteries, filed a petition for initiation of anti dumping investigation concerning import into India of lead acid batteries from Japan, Republic of Korea, China and Bangladesh—Appellant company subsidiary of a multinational company carrying on business of manufacturing lead acid batteries in China responded to the initiation notice—However, ­appellant had given no information on the type/model of batteries being manufactured by them which were not being exported to India—It was noted that the information given by appellant was ‘selective, incomplete and hence not acceptable’—However, finding ­recorded by Designated Authority that appellant operated on market economy principles—Designated Authority had visited manufacturing units of appellant in China and verified the information produced by appellant—Whether Tribunal was justified in holding that China was a non market economy, therefore, normal value should be determined on basis of amendments to Rules relating to non market economies—(No).

       Held : It is not necessary to decide whether China was to be treated as a ­non-market economy during the period of ­investigation or whether the normal value should be decided on a country-wise basis, as we are not prepared to allow the respondent No. 1 to take up what is clearly an inconsistent stand. Its submission before the Tribunal as recorded in the Tribunal’s order was that the final finding of the Designated ­Authority could not be sustained because it was in clear ­violation of the Rules as amended by the ­notifications dated 15th July, 1999 and 31st May, 2001. The stand has been reiterated before this Court in the counter affidavit filed by the respondent No. 1 where it is categorically averred that the notification dated 31st May, 2001 had been violated by the Designated Authority and that the Tribunal had rightly come to the conclusion that the ­Designated Authority had failed to determine the normal value of the Appellants ­exports in ­accordance with the Rules applicable to ­non-market economy units as provided inter alia in the notification dated 31st May, 2001. Indeed that was the basis on which the ­respondent No. 1’s appeal had been allowed by the Tribunal. If the Tribunal was correct, then, even according to the Tribunal, under the second notification dated 31st May, 2001, market driven units in non-market economy countries could prove that they were operating according to market prin­ciples. This exception has been provided to the rule of uniform normal value for all ­exporters in non-market economy countries. (Para 21)

       It was the clear case of the appellant that it had already produced sufficient material before the Designated Authority to justify a finding that the appellant was operating according to market conditions. It must be remembered that the Designated Authority had already visited the manufacturing units of the appellant in China and verified the information produced by the appellant. The Tribunal had only directed the Designated Authority to consider the data already made available by the appellant in the light of paragraphs 7 and 8 of Annexure I. That is exactly what the Designated Authority did. Since the Designated Authority had verified the data prior to submitting its final finding, there was no question of the Designated Authority re-verifying the information given by the appellant. That this could not have been even within the contemplation of the Tribunal is clear from the fact that the Tribunal had granted only seven days time within which the Designated Authority was to submit its report. The respondent No. 1’s contention that the verification was improperly done cannot be gone into at this stage. (Para 22)

       Admittedly the Designated Authority had initiated, conducted and concluded the proceedings under Rules 1 to 6. If non market economy principles have now to be applied then the entire process would have to start from scratch. Indeed whether China should have been treated as a non-market economy for the period in question is itself in dispute. Under Rule 17, the Designated Authority is required to submit its final finding within one year from the date of initiation of the notice or at the most by another six months if the Central Government is satisfied that there are special circumstances. The period has long since expired. (Para 27)