The New Delhi bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) held that while determining the cost sales of domestic industry on import of ‘Mono Ethylene Glycol’ the market value of ethylene should be considered.
Reliance Industries Limited, the appellant assessee was a domestic producer of ‘Mono Ethylene Glycol’ (MEG) in India, had filed this appeal to assail the Notification notifying that since the domestic industry had not suffered material injury in terms of the provisions contained in the Customs Tariff (Identification, Assessment, and Collection of Anti- Dumping Duty on Dumped Articles and for Determination of Injury) Rules, 1995 it would not be appropriate to recommend a levy of anti-dumping duty on the import of MEG.
The assessee appealed against the final findings of the designated authority deciding not to recommend imposition of anti-dumping duty on imports of MEG originating in or exported from the subject countries.
Vipin Kumar Jain, Vishal Agarwal, Reena Asthana Khair, Rajesh Sharma, Tuhina Sinha,Shreya Dahiya, Vrinda Bagaria, Subham Jaiswal, Samarth Bajaj, and Nikhil Sharma appeared on behalf of the assessee.
The counsel for the assessee contended that as ethylene was not sold in the market, it was for its Cost Accounting records, considered as a cost center, and the ethylene captively produced was transferred to the MEG plant at cost without any return or profit.
Also submitted that since the subject goods require specialized storage capacities, prolonged storage was not viable and Consequently, it was forced to sell its product in the market at prices that were not remunerative.
Shobha Nath and Rakesh Kumar, the counsels for the Designated Authorities contended that both dumping and injury margins determined by the designated authority are positive and significant and concluded that though there was significant dumping, but there was no material injury to the domestic industry.
The Bench observed that domestic industry consistently submitted that the price injury was evident as the imports were coming at prices not only below the prices of the domestic industry but even below the raw material price. In this regard, it would be useful to reproduce portion of the comments made by the assessee to the disclosure statement, which indicates that even ethylene (raw material) prices during the period of investigation were higher than MEG import prices.
The three-member bench comprising Dilip Gupta (President) Binu Tamata (Judicial) and Hemambika Priya (Technical) held that while conducting the profitability analysis for examining the impact of dumped imports on the condition of the “domestic industry”, the designated authority should have considered the market price of ethylene while determining the cost of sales of the domestic industry.
Subscribe Taxscan Premium to view the JudgmentSupport our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates
