http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 1 of 19

CASE NO.:

Appeal (civil) 773 of 2001

PETITIONER:

Rishiroop Polymers Pvt. Ltd.

RESPONDENT:

Designated Authority & Additional Secretary

DATE OF JUDGMENT: 23/03/2006

BENCH:

ASHOK BHAN & G.P. MATHUR

JUDGMENT:

J U D G M E N T

With

Civil Appeal Nos. ......1703....... of 2006

(Arising out of SLP) Nos. 22905-22906 of 2003

Korea Kumho Petrochemicals Co.Ltd. ....Appellant

- Versus -

Union of India & Ors. ....Respondents

Civil Appeal Nos. 7159-7161 of 2004

Punit Resins Ltd. ....Appellant

- Versus -

Union of India & Ors. ....Respondents

Civil Appeal No. 7162 of 2004

Korea Kumho Petrochemicals Co. Ltd. ....Appellant

- Versus -

Ministry of Finance & Ors. ...Respondents

Bhan, J.

Leave granted in Special Leave Petition (Civil

) Nos. 22905 - 22906 of 2003.

This judgment shall dispose of Civil Appeal No.

773 of 2001 against the final Order No. 22 of 2000-

AD in Appeal No. C/330/97-AD dated 2.2.2000 passed

by the Customs, Excise & Gold (Control) Appellate

Tribunal, New Delhi [ for short "the Tribunal" ];

Civil Appeals arising out of SLP ) Nos. 22905 -

22906 of 2003 against the final order No. 10/03-AD

and Misc. Order No. 9/03-AD dated 13.6.2003 passed

by the Customs, Excise and Service Tax Appellate

Tribunal, New Delhi in Appeal No. C/586/2001-AD

with C/Misc./100/2002-AD; Civil Appeal Nos. 7159-

7161 of 2004 against the final order Nos. 14-

16/2004-NB(A) dated 1.7.2004 passed by the Customs,

Excise and Service Tax Appellate Tribunal, New

Delhi in Appeal Nos. C/260/2002-AD, C/596/2002-AD

and C/687/2002-AD; and Civil Appeal No. 7162 of

2004 against the final order No. 17/2004-NB(A)

dated 1.7.2004 passed by the Customs, Excise and

Service Tax Appellate Tribunal, New Delhi [ for

short "the Tribunal" ] in Appeal No. C/14/2003-AD.

These appeals are interconnected and pertain

to the same cause of action. Civil Appeal No. 773

of 2001 is against the final order imposing anti-

dumping duty for a period of five years, Civil

Appeals arising out of SLP) Nos. 22905-22906 of

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 2 of 19

2003 are directed against the orders passed in "Mid

Term Review" and Civil Appeal Nos. 7159-7162 of

2004 are against the order passed for continuance

of anti-dumping duty in the "Sunset Review" for

another period of five years.

Common facts giving rise to the cause of action

and the litigation are as follows:

Before adverting to the issues raised in these

appeals it will be relevant to mention the

historical background of the relevant statute and

the Rules. Keeping in tune with the changing

international economic scenario, the Government of

India adopted the path of liberalization in its

fiscal/economic policies. The focus changed from a

closed economic setup to an open one. This shift

in the focus invited foreign capital, goods,

products etc., in now open Indian market. This

resulted in stiff competition for the domestic

industry which had to now compete with the foreign

products both in terms of price as well as its

quality. Although, the said process of

liberalization had its positive side, i.e., making

available foreign products to the domestic users,

but it was also seen as having negative impact,

which if not regulated properly, would have

resulted in adversely affecting the domestic

industry, thereby sometimes leading to closure of

the same and/or retarding its growth leading to an

economic crisis.

Though committed to the liberalization, the

Government of India also simultaneously took enough

speedy measures to ensure a level field playing for

the domestic as well as foreign producers. The

concern of the Government in this regard was

translated into various amendments which were made

in the Customs Tariff Act, 1975 [ for short "the

Tariff Act" ] from time to time. During the year

1995 amendments were made to the Tariff Act.

Section 9 (A), which is the charging section, was

introduced whereby it became permissible for the

Central Government to impose Anti-Dumping duty on

importation of foreign articles which were found to

be dumped in India at a price which was lower than

the normal price of such imported goods in their

country of manufacture/origin. It defines the

margin of profit, normal value and export price.

It also provides for duration of levy of anti-

dumping duty, its review from time to time as well

as its continuance for a further period of five

years, , if the cessation of duty is likely to lead

to continuance or recurrence of dumping and injury.

This duty is over and above any other duty in

force.

Section 9 (A) of the Tariff Act reads as under:

"9A. Anti-dumping duty on dumped

articles. - (1) Where any article is

exported from any country or territory

(hereinafter in this section referred

to as the exporting country or

territory) to India at less than its

normal value, then, upon the

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 3 of 19

importation of such article into

India, the Central Government may, by

notification in the Official Gazette,

impose an anti-dumping duty not

exceeding the margin of dumping in

relation to such article.

Explanation. - For the purposes of

this section, -

(a) "margin of dumping", in relation

to an article, means the difference

between its export price and its

normal value;

(b) "export price", in relation to an

article, means the price of the

article exported from the exporting

country or territory and in cases

where there is no export price or

where the export price is unreliable

because of association or a

compensatory arrangement between the

exporter and the importer or a third

party, the export price may be

constructed on the basis of the price

at which the imported articles are

first resold to an independent buyer

or if the article is not resold to an

independent buyer, or not resold in

the condition as imported, on such

reasonable basis as may be determined

in accordance with the rules made

under sub-section (6);

(c) "normal value", in relation to an

article, means -

(i) the comparable price, in the

ordinary course of trade, for the like

article when meant for consumption in

the exporting country or territory as

determined in accordance with the

rules made under sub-section (6); or

(ii) when there are no sales of the

like article in the ordinary course of

trade in the domestic market of the

exporting country or territory, or

when because of the particular market

situation or low volume of the sales

in the domestic market of the

exporting country or territory, such

sales do not permit a proper

comparison, the normal value shall be

either -

(a) comparable representative price of

the like article when exported from

the exporting country or territory to

an appropriate third country as

determined in accordance with the

rules made under sub-section (6); or

(b) the cost of production of the said

article in the country of origin along

with reasonable addition for

administrative, selling and general

costs, and for profits, as determined

in accordance with the rules made

under sub-section (6):

Provided that in the case of import of

the article from a country other than

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 4 of 19

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.

(2) The Central Government may,

pending the determination in

accordance with the provisions of this

section and the rules made thereunder

of the normal value and the margin of

dumping in relation to any article,

impose on the importation of such

article into India an anti-dumping

duty on the basis of a provisional

estimate of such value and margin and

if such anti-dumping duty exceeds the

margin as so determined : -

(a) the Central Government shall,

having regard to such determination

and as soon as may be after such

determination, reduce such anti-

dumping duty; and

(b) refund shall be made of so much of

the anti-dumping duty which has been

collected as is in excess of the anti-

dumping duty as so reduced.

(2A) Notwithstanding anything

contained in sub-section (1) and sub-

section (2), a notification issued

under sub-section (1) or any anti-

dumping duty imposed under sub-section

(2), unless specifically made

applicable in such notification or

such imposition, as the case may be,

shall not apply to articles imported

by a hundred per cent export-oriented

undertaking or a unit in a free trade

zone or in a special economic zone.

Explanation:- For the purposes of this

section, the expressions "hundred per

cent export-oriented undertaking",

"free trade zone" and "special

economic zone" shall have the meanings

assigned to them in Explanation 2 to

sub-section (1) of section 3 of the

Central Excise Act, 1944 (1 of 1944).

(3) If the Central Government, in

respect of the dumped article under

inquiry, is of the opinion that -

(i) there is a history of dumping

which caused injury or that the

importer was, or should have been,

aware that the exporter practices

dumping and that such dumping

would cause injury; and

(ii) the injury is caused by

massive dumping of an article

imported in a relatively short

time which in the light of the

timing and the volume of imported

article dumped and other

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 5 of 19

circumstances is likely to

seriously under-mine the remedial

effect of the anti-dumping duty

liable to be levied,

the Central Government may, by

notification in the Official Gazette,

levy anti-dumping duty retrospectively

from a date prior to the date of

imposition of anti-dumping duty under

sub-section (2) but not beyond ninety

days from the date of notification

under that sub-section, and

notwithstanding anything contained in

any law for the time being in force,

such duty shall be payable at such

rate and from such date as may be

specified in the notification.

(4) The anti-dumping duty chargeable

under this section shall be in

addition to any other duty imposed

under this Act or any other law for

the time being in force.

(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 :

Provided further that where a review

initiated before the expiry of the

aforesaid period of five 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.

(6) The margin of dumping as referred

to in sub-section (1) or sub-section

(2) shall, from time to time, be

ascertained and determined by the

Central Government, after such inquiry

as it may consider necessary and the

Central Government may, by

notification in the Official Gazette,

make rules for the purposes of this

section, and without prejudice to the

generality of the foregoing, such

rules may provide for the manner in

which articles liable for any anti-

dumping duty under this section may be

identified, and for the manner in

which the export price and the normal

value of, and the margin of dumping in

relation to, such articles may be

determined and for the assessment and

collection of such anti-dumping duty.

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 6 of 19

(7) Every notification issued under

this section shall, as soon as may be

after it is issued, be laid before

each House of Parliament.

(8) The provisions of the Customs Act,

1962 (52 of 1962) and the rules and

regulations made thereunder, relating

to, the date for determination of rate

of duty, non-levy, short levy,

refunds, interest, appeals, offences

and penalties shall, as far as may be,

apply to the duty chargeable under

this section as they apply in relation

to duties leviable under that Act."

[emphasis supplied]

Method of determination of the injury and the

procedure to be followed is provided in Section 9B

of the Tariff Act, relevant portion of which is

extracted below:

"9B. No levy under section 9 or

section 9A in certain cases. - (1)

Notwithstanding anything contained in

section 9 or section 9A: \027

(a) ..........

(b) the Central Government shall not

levy any countervailing duty or anti-

dumping duty -

(i) under section 9 or section 9A by

reasons of exemption of such

articles from duties or taxes

borne by the like article when

meant for consumption in the

country of origin or exportation

or by reasons of refund of such

duties or taxes;

(ii) under sub-section (1) of each of

these sections, on the import

into India of any article from a

member country of the World

Trade Organisation or from a

country with whom Government of

India has a most favoured nation

agreement (hereinafter referred

as a specified country), unless

in accordance with the rules

made under sub-section (2) of

this section, a determination

has been made that import of

such article into India causes

or threatens material injury to

any established industry in

India or materially retards the

establishment of any industry in

India; and

(iii) ......................

(2) The Central Government may, by

notification in the Official

Gazette, make rules for the

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 7 of 19

purposes of this section, and

without prejudice to the

generality of the foregoing, such

rules may provide for the manner

in which any investigation may be

made for the purposes of this

section, the factors to which

regard shall be at in any such

investigation and for all matters

connected with such

investigation."

Under the scheme a provisional levy of duty is

contemplated which is preceded by preliminary

findings regarding dumping and the consequent

injury to the domestic industry. Under Section 9

(c) an appeal is provided against the determination

or review thereof. This appeal is regarding the

existence, degree and effect of any dumping in

relation to any article by the designated authority

from time to time.

In exercise of the power under the Tariff Act,

the Customs Tariff (Identification, Assessment and

Collection of Anti-dumping Duty on Dumped Articles

and for Determination of Injury) Rules, 1995 [ for

short "the Rules" ] were framed. Rule 2 (b)

defines the "domestic industry" to mean:

"(b) "domestic industry" means the

domestic producers as a whole engaged

in the manufacture of the like article

and any activity connected therewith

or those whose collective output of

the said article constitutes a major

proportion of the total domestic

production of that article except when

such producers are related to the

exporters or importers of the alleged

dumped article or are themselves

importers thereof in which case such

producers may be deemed not to form

part of domestic industry.

Provided that in exceptional

circumstances referred to in sub-rule

(3) of Rule 11, the domestic industry

in relation to the article in question

shall be deemed to comprise two or

more competitive markets and the

producers within each of such market a

separate industry, if -

(i) the producers within such a market

sell all or almost all of their

production of the article in

question in that market; and

(ii) the demand in the market is

not in any substantial degree

supplied by producers of the said

article located elsewhere in the

territory;

Explanation. - For the purposes of

this clause, -

(i) producers shall be deemed to be

related to exporters or importers

only if, -

(a) one of them directly or

indirectly controls the

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 8 of 19

other; or

(b) both of them are directly

or indirectly controlled by a

third person; or

(c) together they directly or

indirectly control a third

person subject to the

condition that are grounds

for believing or suspecting

that the effect of the

relationship is such as to

cause the producers to behave

differently from non-related

producers.

(ii) a producer shall be deemed to

control another producer when the

former is legally or operationally

in a position to exercise

restraint or direction over the

latter."

Under Rule 3, the Central Government by a

notification can appoint a person not below the

rank of Joint Secretary of the Government of India

or such other person which the Government of India

may think fit as designated authority for the

purpose of said Rules. Under Rule 4, it is the

duty of the designated authority to investigate as

to the existence, degree and effect of any alleged

dumping in relation to any import of any article

and also to identify the article liable for anti

dumping. The designated authority is also

empowered to recommend to the Central Government as

regards normal value, export price, margin of

dumping and also give its findings on injury or

threat of injury to the domestic industry. The

date on which the duty is commenced is also to be

recommended by the designated authority. The

designated authority is also further empowered to

review the need for continuance of any anti-dumping

duty under Rule 23.

As per the procedure contemplated under Rule 5,

the designated authority initiates an investigation

regarding the existence, degree and effect of any

alleged dumping, upon receipt of a written

application by or on behalf of the domestic

industry containing all relevant data, figures and

details supported by evidence of dumping, injury

and also the causal link between such dumped

articles and the alleged injury. Over and above,

under sub-clause 4 of Rule 5 of the Rules, the

designated authority also has a suo motu power to

initiate investigation, if it is satisfied from the

information received from the Collector of Customs

or from any other source regarding the dumping.

The designated authority is also required to notify

the Government of the exporting countries before

proceeding/initiating any investigation.

If the decision is taken by the designated

authority to initiate investigation, a detailed

exercise involving participation by the domestic

industry, the exporter, importer and all other

interested parties, begins. Other interested

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 9 of 19

parties, who are likely to be affected by the duty

are also heard and objections are invited from them

within a period of 30 days. The representative of

consumer organizations also sometimes are heard,

depending on the situation. Under Rule 11 of the

Rules, the designated authority is required to

determine the injury to the domestic industry,

threat of injury to domestic industry, material

retardation to the establishment of the domestic

industry, a causal link between the dumped imports

and the injury. This is done by taking into

account all relevant factors including the volumes

of dumped imports, their effect on the price in the

domestic market. The principles on which the

determination are done is indicated in Annexure II

to the Rules. Rule 11 reads:

"11. Determination of injury. - (1) In

the case of imports from specified

countries, the designated authority

shall record a further finding that

import of such article into India

causes or threatens material injury to

any established industry in India or

materially retards the establishment

of any industry in India.

(2) The designated authority shall

determine the injury to domestic

industry, threat of injury to domestic

industry, material retardation to

establishment of domestic industry and

a causal link between dumped imports

and injury, taking into account all

relevant facts, including the volume

of dumped imports, their effect on

price in the domestic market for like

articles and the consequent effect of

such imports on domestic producers of

such articles and in accordance with

the principles set out in Annexure II

to these rules.

(3) The designated authority may, in

exceptional cases, give a finding as

to the existence of injury even where

a substantial portion of the domestic

industry is not injured, if -

(i) there is a concentration of dumped

imports into an isolated market, and

(ii) the dumped articles are causing

injury to the producers of all or

almost all of the production within

such market."

After the initiation of investigation, followed

by the preliminary findings, if any, Rules

contemplate giving of the final findings by the

designated authority under Rule 17 of the Rules.

Such a final finding is to be given within a period

of one year from the date of the investigation.

The parameters are given in Rule 17. Rule 18 of

the Rules provides that the Central Government may,

within three months of the date of publication of

the final findings by the designated authority

under Rule 17, impose anti-dumping duty. The amount

of the duty has to be an amount adequate to remove

injury to the domestic industry. Apart from this,

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 10 of 19

other guidelines have also been provided for in

Rule 18, which have to be considered while deciding

the levy of the quantum of duty. Rule 23 provides

for the review of levy and exemption of duty from

time to time. The same reads:

"23. Review. - (1) The designated

authority shall, from time to time,

review the need for the continued

imposition of the anti-dumping duty

and shall, if it is satisfied on the

basis of information received by it

that there is no justification for the

continued imposition of such duty

recommend to the Central Government

for its withdrawal.

(2) Any review initiated under sub-

rule (1) shall be concluded within a

period not exceeding twelve months

from the date of initiation of such

review.

(3) The provisions of rules 6, 7, 8,

9/10, 11, 16, 17, 18, 19, and 20 shall

be mutatis mutandis applicable in the

case of review."

Civil Appeal No. 773 of 2001.

This appeal is directed against the final

order of the Tribunal upholding the final order

passed by the Designated Authority under Rule 17,

recommending levy of anti-dumping duty consequent

upon which, the Central Government imposed anti-

dumping duty under Rule 18.

Appellant is the sole agent of Acrylonitrile

Butadiene Rubber [ for short " NBR" ] as

manufactured by Korea Kumho Petrochemicals Limited

[ for short "KKPC" ]. The subject goods are oil

resistance rubber and are of various grades like:

KOSYN KNB 35 L

KOSYN KNB 35 LL

KOSYN KNB 35 LM

KOSYN KNB 35 LH

KOSYN KNB 0230

KOSYN KNB 0230 L

KOSYN KNB 0230 H

The subject goods are being imported into India for

near about a decade. The appellant's entire

activities/trading activities and earning is from

the sale of the subject goods as are imported from

time to time in lawful manner subject to the policy

laid by the concerned authorities.

The subject anti-dumping duty proceedings

relate to NBR which is the commercially known name

of the said type of goods. Broadly speaking NBR is

a synthetic rubber mainly used in the manufacture

of other rubber articles such as oil seals, hoses,

automobile product, rice dehusking rolls etc.. NBR

is a generic term. It has various grades and

physical forms. Various grades have different

purposes and are put to use as raw material for the

production of various types of finished products.

The rubber industry in India is a vital

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 11 of 19

industry and has a bearing on the economic health

of the country. The industry caters to a number of

critical requirements including those of

agriculture, defence, aviation and automobile

sectors, among others. It provides employment,

directly or indirectly to a large number of people

in small, medium and large scale sector units,

which are affected by adverse development in the

industry.

Gujarat Apar Polymers Ltd. (GAPL), the name of

which has been changed to M/s Apar Industries

imited, hereinafter

referred to Respondent No. 3, (amendment was

allowed vide this Court's Order dated 19.1.2001

passed in I.A.No. 3), are the manufacturers of some

grades of NBR. Respondent No. 3 by means of

complaint dated 3.11.1995 addressed to the

Additional Secretary being the designated authority

under Section 9 of the Tariff Act in the Ministry

of Commerce, stated that the import of bales of the

said consignment from Germany is causing injury to

its productions. Proceedings were initiated by the

Public Notice dated 1.3.1995 against export of NBR

from Germany and Korea. The period of

investigation was 1.10.1994 to 31.3.1995.

Responses were filed by the interested parties.

Normal value was determined on the basis of

weighed average ex-factory selling price in the

domestic market. By taking into consideration the

cumulative effect of imports from both the

countries, the designated authority came to the

conclusion that the injury was suffered by the

domestic industry and as such gave a preliminary

finding dated 30.12.1996 imposing anti-dumping

duty. Thereafter, the designated authority

confirmed its preliminary finding dated 30.12.1996.

Union of India, accepted the final finding and

issued a notification dated 17.7.1997 As per

findings, duty was slightly enhanced in so far as

Germany was concerned and partially reduced in so

far as the export from Korea was concerned.

Section 9A provides that where any article is

exported from any country or territory to India at

less than its normal value then upon the

importation of such article into India, the Central

Government may, by notification in the Official

Gazette, impose an anti-dumping duty not exceeding

the margin of dumping in relation to such article.

Export price in relation to an article has been

defined to mean the price of the article exported

from the exporting country and the normal price

has been defined to mean the comparable price, in

the ordinary course of trade, for the like article

when meant for consumption in the exporting

country. The designated authority after

considering the entire data of facts came to the

conclusion that the article NBR exported to India

from Korea and Germany was not de minis as the

difference in price in the local market (India) and

the price at which it was sold in the country of

export was more than 2% and further the total

quantity exported from Korea was more than 3% of

the total imports. That the injury was caused to

the domestic industry. In so far as causal link

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 12 of 19

was concerned, it was held that because of the NBR

exported to the country a material injury had been

caused to the domestic industry. In determining

whether the material injury to the domestic

industry was caused by the dumped goods, the

authority took into consideration the following

facts:

"a) The imports of the product from

the subject countries cumulatively

increased significantly in absolute

terms and relative to the production

and consumption of the product in

India. The share of the subject

countries in the total imports also

increased significantly. As a direct

consequence, the domestic industry

lost market to a significant level,

which it would have otherwise gained;

b) The substantial imports of NBR

from the subject countries force the

domestic industry to sell its produce

at unremunerative prices, resulting in

financial losses;

c) The trend of various parameters

indicating injury to the domestic

industry establish that the reasons

for the same are the imports from the

subject countries.

In final conclusion the authority recorded the

following findings:

"-- NBR originating in or exported

from Germany and Korea RP has been

exported to India below its normal

value;

-- The domestic industry has suffered

material injury;

-- The injury has been caused to the

domestic industry by the exports

originating in or exported from

Germany and Korea RP."

In appeal, as noted by the Tribunal in para 5,

the counsel for the appellant had confined his

arguments on the point of injury, causal link and

cumulation of imports from Korea and Germany while

assessing injury. The Tribunal, after considering

the submissions of the respective learned counsels

for the parties, rejected the submissions raised on

behalf of the appellant and held that the material

injury to the domestic industry had been caused due

to dumping and there was a causal link between

them. The submission made by the counsel for the

appellant that the injury, if any, caused to the

domestic industry has been caused because of the

extensive and voluminous of export from Japan, was

rejected by holding that the present complaint

pertains to the exports from Korea and Germany

only. In so far as Japan is concerned, proceedings

were initiated at the instance of Respondent No. 3

for the export made from Japan and an anti-dumping

duty has already been imposed on the export made

from Japan to India.

In para 14 of the impugned order, the Tribunal

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 13 of 19

has converted the anti-dumping duty in US dollar

terms on its own volition even though there was no

prayer by the appellant or a cross appeal/objection

by any other party.

Learned counsel for the appellant did not press

his arguments regarding the injury to the domestic

industry, causal link and cumulation of imports

from Germany and Korea for injury assessment during

the course of arguments before us. The only

argument pressed before us is regarding the

conversion of anti-dumping duty from US Dollar

terms by the Tribunal on its own volition even

though there was no prayer by the appellant or a

cross appeal/objection by the respondent. Another

aspect highlighted by the learned counsel for the

appellant is relating to violation of para (iv) of

Annexure II of the Rules while assessing injury.

Shri A. Sharan, learned Addl. Solicitor General

of India, after taking instruction from the Union

of India conceded that the Tribunal erred in

converting the anti-dumping duty in US Dollar terms

in the absence of any appeal or cross appeal by the

respondent. He conceded that the order passed by

the Tribunal in converting the anti-dumping duty in

US Dollar terms be set aside and order of the

designated authority in imposing the anti-dumping

duty in rupee term be restored. It is so ordered.

Regarding non-consideration of the various

parameters laid down in para (iv) of Annexure II,

it was submitted by him that since this issue had

not been raised before the appellate Tribunal the

appellant cannot be permitted to raise the same for

the first time in this Court as the finding

recorded by the Designated Authority on this score

is essentially a finding of fact based on

appreciation of material placed before it by the

interested parties. After going through the

records, we find that the point regarding the

violation of para (iv) of Annexure II to the Rules

had not been raised either in the memorandum of

appeal before the Tribunal or during the course of

arguments. The point regarding the violation of

parameters laid down in para (iv) of Annexure II to

the Rules has also not been taken in the special

leave petition. The finding recorded by the

designated authority being essentially a finding

of fact having not been questioned before the

Tribunal cannot be permitted to be raised for the

first time in this Court during the course of the

argument. This Court in Shenyang Matsushita S.

Battery Co. Ltd. Vs. Exide Industries Ltd, 2005

(3) SCC 39; and Bhilai Casting (P) Ltd. Vs. CCE,

2005 (10) SCC 492, has held that if a point or

issue had not been raised before the appellate

tribunal then it would not be permitted to be

raised for the first time before this Court. Since

the point regarding non-observation of parameters

laid down in para (iv) of Annexure II to the Rules

had not been raised before the Tribunal either in

the memorandum of appeal or during the course of

arguments before the Tribunal cannot be permitted

to be raised for the first time before us and we

decline to go into the same.

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 14 of 19

For the reasons stated above, this appeal is

accepted only to the limited extent. The finding

recorded by the tribunal in converting the anti-

dumping duty for the period in question from rupee

term to US dollar term without there being any

appeal, counter appeal or objection by the

respondent is set aside. The duty shall be payable

in rupee term, in terms of the order passed by the

designated authority. Except to the extent

indicated above the appeal is dismissed without any

order as to costs.

Civil Appeal Nos. ............. of 2006

(Arising out of SLP) Nos. 22905-22906 of 2003)

The instant appeals relate to the imposition of

anti-dumping duty on the basis of "Mid Term Review"

carried out under Rule 23 of the Rules.

Section 9 A of the Customs Tariff Act, 1975 is

the charging section. It empowers the Central

Government to impose an anti-dumping duty not

exceeding the margin of dumping on an article

exported to India at less than its normal value.

However, this is subject to the provisions of

Section 9B. Section 9B(1)(b)(ii) provides, that

the Central Government shall not levy anti-dumping

duty on articles imported from a specified country

(members of the WTO and those with whom India has a

Most Favoured Nation (MFN) agreement) unless in

accordance with the Rules made under Section 9B(2)

a determination has been made that the import of

such article causes material injury to an industry

in India. In terms of Rule 11 of the Rules framed

under Sections 9A(6) and 9(B)(2), recording of a

finding on material injury is sine qua non for

imposition of the duty. Sub-rule (2) of Rule 11

provides that the Designated Authority shall

determine the injury to domestic industry, threat

of injury to domestic industry, material

retardation to establishment of domestic industry

and a causal link between dumped imports and

injury, taking into account all relevant facts,

including the volume of dumped imports, their

effect on price in the domestic market for like

articles and the consequent effect of such imports

on domestic producers of such articles and in

accordance with the principles set out in Annexure-

II of these Rules, which reads thus:

"(iv) The examination of the impact of

the dumped imports on the domestic

industry concerned, shall include an

evaluation of all relevant economic

factors and indices having a bearing

on the state of the industry,

including natural and potential

decline in sales, profits, output,

market share, productivity, return on

investments or utilisation of

capacity; factors affecting domestic

prices; the magnitude of the margin of

dumping; actual and potential negative

effects on cash flow, inventories,

employment, wages, growth, ability to

raise capital investments. "

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 15 of 19

Rule 23(1) empowers the Designated Authority to

review the need for continued imposition of anti-

dumping duty from time to time and, the Designated

Authority, if satisfied on the basis of the

information received by it that there is no

justification for the continued imposition of such

duty, can recommend to the Central Government for

its withdrawal. Sub rule (2) of these Rules

provides that the review initiated under sub-rule

(1) shall be concluded within a period of not

exceeding 12 months from the date of initiation of

such review. Sub-rule(3) provides that the

provisions of Rules 6, 7, 8, 9, 10, 11, 16, 17, 18,

19 and 20 shall be mutatis mutandis applicable in

the case of review.

Counsel for the appellant contended that it is

mandatory for the Designated Authority to evaluate

all the relevant economic factors, more

particularly, the factors specifically enumerated

in para (iv) of Annexure-II following the word

"including". According to him, all the listed

parameters have to be evaluated and, in addition,

any other relevant economic factor may also be

considered. He emphasized that the evaluation of

the 14 parameters mentioned in para (iv) of

Annexure-II is mandatory and the Designated

Authority has to consider and record a finding on

each one of them. This is the only point raised by

the learned counsel for the appellant in these

appeals. As against this learned senior counsel

appearing for the respondents contended that the

scope of review inquiry by the Designated Authority

is limited to the satisfaction as to whether there

is justification for "continued imposition of such

duty on the basis of the information received by

it." The inquiry could be at the behest of the

interested party or suo motu by the Designated

Authority.

Before considering the rival submissions

advanced by the counsel for the parties, it may be

stated that the Designated Authority had considered

the appellant to be a non-cooperative exporter and

determined the normal value of NBR produced by it

on "facts available basis". This finding of the

Designated Authority has been confirmed by the

Tribunal in the impugned order. The Tribunal has

further held that in the facts and circumstances of

the present case, the normal value arrived at by

the Designated Authority was not required to be

disturbed in the absence of reliable alternative

basis provided by the appellant.

The Tribunal further observed that in respect

of injury analysis, while the appellants may be

right in maintaining that all the parameters

stipulated in para (iv) of Annexure-II to the Anti-

Dumping Rules were required to be considered by the

Designated Authority, but Annexure-II does not

stipulate a separate injury analysis for a review

investigation, as the parameters mentioned therein

were not a check list. It is not necessary to

faithfully mention each of the criteria and an

appropriate notation against each of them, but a

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 16 of 19

sound appreciation of the situation based on the

relevant criterion.

We have considered the rival submissions put

forth by the counsel for the parties. The Mid Term

Review in the instant case was initiated suo motu

after the domestic industry had withdrawn its

application and the Review initiated at its

instance was closed.

For the purpose of ascertaining whether there

was justification for continued imposition of anti-

dumping duty, all relevant information was asked

for from the domestic industry as well as the

appellant and other interested parties. The

domestic industry supplied all the relevant

material for the continued imposition of the anti-

dumping duty whereas the appellant did not

cooperate with the Designated Authority during the

time of Mid Term Review but it took the stand that

there was no dumping. Though before the Designated

Authority the appellant had not raised a ground

that all the 14 parameters given in para (iv) of

Annexure-II relating to principles of determination

of injury were required to be determined or had not

been taken into account and that only some of the

parameters were considered, in appeal before the

Tribunal, the said ground was raised and findings

were returned against the appellant. Before us it

is submitted that the parameters mentioned in the

Rules read with para (iv) of Annexure-II are

mandatory, and the finding as to the injury to the

domestic industry by the Designated Authority is

perverse.

After going through the entire record with the

assistance of the learned counsel for the parties,

we are of the opinion that the contention raised by

the appellant is clearly contrary to the facts on

record. The Designated Authority in its findings

in the Mid Term Review proceedings has

categorically stated that all the factors have been

taken into consideration while determining

continuance of the anti-dumping duty. That apart,

at the time of arguments, we had the advantage of

going through the original records/documents

(original/confidential file was produced in the

Court) which had been placed before the Designated

Authority, which shows that along with the

information provided in the pro-forma, necessary

information with respect to all the 14 parameters

had been provided by the domestic industry and

considered by the designated authority, after due

corrections. In view of the foregoing

consideration, the argument of the appellant that

all relevant factors have not been considered has

no factual foundation.

Otherwise also, we are of the opinion that

scope of the review inquiry by the Designated

Authority is limited to the satisfaction as to

whether there is justification for continued

imposition of such duty on the information received

by it. By its very nature, the review inquiry

would be limited to see as to whether the

conditions which existed at the time of imposition

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 17 of 19

of anti-dumping duty have altered to such an

extent that there is no longer justification for

continued imposition of the duty. The inquiry is

limited to the change in the various parameters

like the normal value, export price, dumping

margin, fixation of non-injury price and injury to

domestic industry. The said inquiry has to be

limited to the information received with respect to

change in the various parameters. The entire

purpose of the review inquiry is not to see whether

there is a need for imposition of anti-dumping duty

but to see whether in the absence of such

continuance, dumping would increase and the

domestic industry suffer.

It is of vital importance to note that in the

initial imposition of duty, the appellant has

accepted the position that determination of injury

by the Designated Authority was proper and in

conformity with the requirements of Annexure-II of

the Anti-Dumping Rules. The appellant did not

challenge the final finding of the Designated

Authority before the Tribunal that parameters

mentioned in para (iv) of Annexure-II had not been

considered or satisfied. We have declined the

permission to the appellant to raise this point

before us in Civil Appeal Nos. 773 and 774 of 2001

which were directed against the final findings

recorded by the Designated Authority based on which

the Government of India had imposed the anti-

dumping duty for a period of five years. Under

Section 9A(1), the said initial imposition of anti-

dumping duty is ordinarily contemplated to be

continued and remain in effect for a full period of

five years, at the end of which it would be subject

to sunset review, the possible consequence of which

would be the extension of the operation of the

period of anti-dumping duty for another period of

five years. This is subject to the provisions of

sub-rule (1) of Rule 23 of the Anti-Dumping Rules,

under which the Designated Authority is empowered

to review the anti-dumping duty imposed from time

to time. Having regard to the scheme of the above

mentioned provisions of the statute, once anti-

dumping duty has been initially imposed, it would

be ordinarily continued for five years unless on a

review it is found by the Designated Authority that

there has been such a significant change in the

facts and circumstances, that it is considered

necessary either to withdraw or modify

appropriately the anti-dumping duty which has been

imposed. It is, therefore, clear that unless the

Designated Authority suo motu or the applicant for

review is in a position to establish clearly that

there has been a significant change in th\e facts

and circumstances relating to each of the basic

requirements or conditions precedent for imposing

duty, the finding given by the Designated Authority

at the time of initial imposition of anti-dumping

duty must be considered to continue to hold the

field.

The final findings recorded by the Designated

Authority at the time of initial imposition of

anti-dumping duty on the existence of injury to the

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 18 of 19

domestic industry must be considered to continue to

remain valid, unless it is proved to be otherwise,

either by the Designated Authority in suo motu

review or by the applicant seeking review. In the

present case, the review had been initiated by the

Designated Authority. Neither the Designated

Authority nor the appellant had placed any material

on record which could possibly displace the

findings given by the Designated Authority at the

stage of initial anti-dumping duty. In the absence

of any new material, the Designated Authority is

not required to apply afresh all parameters or

criteria enumerated in para (iv) of Annexure-II,

which had already been done at the initial stage of

imposition of anti-dumping duty. There is no

material on record to show that there was a change

in the parameters or the criteria relating to the

injury which would warrant withdrawal of anti-

dumping duty. Nevertheless, the Designated

Authority has still analysed the issue of injury in

detail in the Mid Term Review findings and has

considered all the criteria or parameters

enumerated in Annexure-II. There is, therefore, no

merit or substance in the appellant's contention

regarding non-compliance with Annexure-II.

The Designated Authority in the Mid Term Review

has reduced the anti-dumping duty from US dollar

264 per MT to US dollar 248 per MT. This again

shows that all the relevant material facts had been

taken into consideration by the Designated

Authority while analyzing the injury caused to the

domestic industry.

It would be pertinent to point out, that in the

facts and circumstances of the present case, the

Designated Authority had imposed duty in dollar

terms and in the appeal before the Tribunal or this

Court, the appellant has not challenged this part

of the order of the Designated Authority. Hence,

the same is confirmed.

For the reasons stated herein above, we do not

find any merit in these appeals. Accordingly, they

are dismissed with costs in favour of the Union of

India.

Civil Appeal Nos. 7159-7161 and 7162 of 2004

These appeals relate to continuation of anti-

dumping duty after the expiry of five years for a

further period of five years.

The anti-dumping duty once imposed is valid for

five years unless revoked earlier. Section 9A(5)

empowers the Central Government to extend the

period of such imposition for a further period of

five years, if in a review, it is determined that

the cessation of such duty is likely to lead to

continuation or recurrence of dumping and injury.

Accordingly, a sunset review was conducted. Period

of investigation was from 1st April, 2000 to 31st

March, 2001.

The Designated Authority, after analyzing the

material placed before it, came to the conclusion

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 19 of 19

that the cessation of the duty is likely to lead to

continuation or recurrence of dumping and injury

and therefore it was necessary to continue with

imposition of anti-dumping duty for another five

years.

Aggrieved against the aforesaid order

continuing the imposition of such duty, the

appellant filed appeals before the Tribunal which

were rejected. Against the order of the Tribunal

upholding the above findings of the Designated

Authority, the present appeals have been filed by

the appellant.

The only challenge put forth in the instant

appeals is to the non-evaluation of all the

parameters listed in para (iv) of Annexure-II.

This contention had not been urged either before

the Designated Authority or the Tribunal and,

therefore, cannot be permitted to be urged for the

first time in these appeals. Further, the records

produced before us unambiguously shows that all the

relevant parameters had been considered.

In this view of the matter, we do not find any

merit in these appeals and dismiss the same with

costs in favour of the first respondent, i.e., the

Union of India.