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MINISTRY OF COMMERCE AND INDUSTRY

(Department of Commerce)

(DIRECTORATE GENERAL OF ANT1 DUMPING AND ALLIED DUTIES)

NOTIFICATION

New Delhi, the 7th December, 2001

FINAL FINDINGS

Subject :—Anti-dumping investigation concerning import of Lead Acid Batteries

originating in or exported from Japan, Korea, China and Bangladesh—-Final

Findings

NO. 67/i/2000-DGAD.-Having regard to the Customs

Tariff Act, 1975 as amended in 1995 and the Customs

Tariff (Identification, Assessment and Collection of Anti

Dumping Duty on Dumped Articles and for Determination

of Injury) Rules, 1995, thereof;

PROCEDURE

The procedure described below has been followed:-

(i)

The Designated Authority (hereinafter referred to as

Authority), under the above Rules, received a written petition

from M/s Exide Industries Limited and M/s. Amara Raja

Batteries Ltd., on behalf of the domestic industry, alleging

dumping of Lead Acid Batteries (hereinafter referred to as

subject goods) originating in or exported from Japan, Korea,

China and Bangladesh (hereinafter referred to as subject

countries):

3763 GI/2001—5

THE GAZETTE OF INDIA: EXTRAORDINARY

| PART I—SK\ 11

(ii)

The investigations were initiated vide initiation

notification dated 12 January, 2001 and the Preliminary

findings were notified on 21^st March, 2001.

(iii) The Designated Authority sent copies of notifications to

the Embassies of Japan, Korea, China and Bangladesh in India,

the exporters, importers, the domestic industry and other

interested parties who were requested to make their views

known in writing within 40 days of the notification.

(iv) The Authority provided opportunity to all interested parties

to present their views orally in a public hearing held on

10.5.2001. The parties presenting their views were requested to

file written submissions of the views expressed. The parties were

advised to collect copies of the views expressed by the opposing

parties and offer rebuttals, if any;

(vi) The Authority made available the public file to all

interested parties containing non-confidential version of all

evidence submitted by various interested parties for inspection,

upon request;

(vii) Argument raised by the interested parties

before

announcing the preliminary findings, which have been brought

out in the preliminary findings notified have not been repeated

herein for sake of brevity. However, the arguments raised by the

interested parties subsequently have been appropriately dealt in

these findings.

(viii) In accordance with Rule 16 of the Rules supra, the

essential facts/basis considered for these findings

were

disclosed to known interested parties and comments received on

the same have also been duly considered in these findings.

(ix) The period of investigation in the present investigation is

1.1.2000 to 30.9.2000.

VIEWS

PETITIONERS,

EXPORTERS,

IMPORTERS AND OTHER INTERESTED PARTIES

AND EXAMINATION BY AUTHORITY.

The views expressed by various interested parties have

been discussed in the preliminary findings and also in the

disclosure statement. The views which have not been discussed

earlier in the preliminary findings and disclosure statement and

those now raised in response to the disclosure statement are

discussed in the relevant paras herein below to the extent these

are relevant as per rules and have a bearing upon the case. The

arguments raised by the interested parties have been examined,

considered and, wherever appropriate, dealt in the relevant

paragraphs herein below.

PRODUCT UNDER CONSIDERATION AND LIKE

ARTICLE:

The product under consideration is "lead acid batteries"

falling under Chapter Sub Heading 8507 of the Customs Tariff

Act. It has been argued that for the purpose of this anti dumping

investigation, product under consideration and like article, each

type of battery should be taken separately because "like product"

means "identical product", "alike in all respects" which can be

substituted in commercial transaction and in practical use. It has

further been argued that for all practical purposes, each type of

lead acid battery is a separate "product". It has further been

stated that Authority has erred in accepting the argument of the

petitioners that the battery of all types should be amalgamated

into one category of lead acid battery by calculating the lead

content of the batteries and weight. It has also been argued that

by accepting all types of batteries which are not commercially

substitutable there has been a serious error on law and on fact on

the part of the Designated Authority in determining the

"product" under investigation and further that each type of

battery within the broader category of automotive and industrial

battery should have been taken separately considering that each

can not be commercially and technically be substituted.

THE GAZETTE OF INDIA: EXTRAORDINARY

I P.u< i 1—Stv. 11

In the Preliminary Findings the Authority has already

divided the batteries into two categories, i.e. automotive and

industrial. Also in the course of investigation and on the basis of

arguments made by some of the interested parties, the Authority

is convinced that the automotive batteries should be further sub-

divided into two categories, viz. automotive and motorcycles.

However, as stated in the para above that within automotive and

industrial batteries, there are large number of models/types but

these types are comparable in terms of physical and chemical

characteristics, manufacturing process, technology, functions

and

uses,

specifications,

distribution

and

marketing

arrangements and tariff classifications and hence fall within the

definition of 'Like Article'.

Even within the two broad

categories of automotive and industrial batteries, in the course of

verification at the premises of the manufacturers, it was found

that in some cases the facilities for manufacture of industrial

batteries were being used for production of automotive batteries

in commercial volumes. Also there are instances of two types of

batteries being used interchangably. The Authority, therefore,

has decided to continue with the description of product under

consideration as Lead Acid Battery as determined in the

Preliminary Findings and also that the Lead Acid Batteries

produced by petitioner companies are like articles to the Lead

Acid Batteries being imported from subject countries within the

meaning of the Rules.

ASSESSMENT ON THE BASIS OF WEIGHT:

In the Initiation Notification as well as in the Preliminary

Findings, the argument given by the domestic industry regarding

the use of lead content and weight of the batteries for assessing

various parameters was considered. It was noted that statistics in

the case of lead acid batteries are compiled in terms of number

of units. But denoting the volume in terms of number of units

may be misleading because different models have different

power, capacity and value. Therefore, apart from denoting the

product in terms of unit and value, it will be useful to have the

information on the product in terms of lead content as there is a

correlation between power and lead content of the battery which

also gets reflected in terms of value or price. Further, the direct

correlation between the lead content in the battery and its

associated costs and prices is also quite significant. An almost

linear relationship between the weight of the battery, its power

and the cost of production were other factors that led to the

decision of taking the weight of the battery for determination of

the reference price/value for the purpose of calculation of

applicable anti dumping duty recommended by the Authority in

the Preliminary Findings.

Subsequent to the Preliminary Findings, it has been argued

that the standard practice in the battery industry is to classify

lead acid battery in terms of number of types/models on the

basis of specifications such as dimension, number of plates,

voltage, ampere hour(AH), length of life etc.. The specifications

vaiy depending on AH rating, voltage, discharge characteristics,

and discharge period. As the specification or capacity vaiy, so

does the weight of the battery including its lead contents. It has

also been argued that this standard practice is followed by the

petitioners also in the commercial transactions and they have

misguided the Designated Authority to assess the anti dumping

duty on weight basis.

In making comparison between two

batteries, the AH capacity, voltage, dischargeperiod, discharge

characteristics, charging characteristics, life of battery, climatic

conditions and nature of use have to be taken into consideration.

Further, it has been stated that the prices of batteries also vary

according to specifications and also cost per Kg. of automotive

battery weight falls as the size(capacity) of a battery increases.

As stated above, there are a large number of parameters

effecting the cost, price and performance of batteries of different

specifications. The interested parties have brought in about ten

such parameters. Also there are a large number of types/models

of automotive

and industrial batteries having

different

specifications that are produced and sold. It is not possible to

recommend duties separately for each of these types/models of

the battery being produced or likely to be produced in future.

However in the course of investigation and verification of the

facilities of the manufacturers, it was confirmed that lead weight

and battery weight are two important parameters for any batteiy

which can be used as common denominators for the purpose of

comparison and calculation. Other criteria such as discharge

THE GAZETTE OF INDIA: EXTRAORDINARY

|Pwi 1—Si.

characteristics, life of the battery etc., are not easily quantifiable

and have the pfoblems of comparison. On the basis of the

evidence before the Authority, the Authority holds that

assessment of different types of batteries in terms of weight for

the purpose of imposition of duty is most appropriate and has

decided to continue with its earlier determination on the basis of

the weight.

It is, however, clarified that the Authority

has made

comparison of normal value and export price separately for each

type of battery and arrived at dumping margin individually for

each type. Thereafter, overall dumping margins for industrial,

automotive and motorcycle lead acid batteries separately for

individual exporters or residual category has been calculated by

taking weighted average of these individual model wise

dumping margins. After arriving at dumping margins for

industrial, automotive and motorcycle batteries separately, the

reference prices have been calculated using the information

relating to the weights of the batteries exported to India.

DOMESTIC INDUSTRY:

10. It has been stated earlier that the petition for initiation of

anti dumping investigation was filed by M/s Exide Industries Ltd

and M/s Amara Raja Batteries Ltd., on behalf of the domestic

industry. On the basis of the evidence available before the

Authority, it was determined that both the petitioners account for

a major proportion of the production in India and have the

standing to file the petition on behalf of the domestic industry.

Also subsequent to initiation, M/s Amco Batteries also supported

the petition and provided the relevant information.

11. It was stated by the petitioners that M/s Amara Raja

Batteries Ltd have made import of certain models of lead acid

batteries from the subject countries which they themselves are

not manufacturing and the volume and the value of the imports

is quite insignificant as compared with the annual production

and sales of the subject goods. It was, therefore, decided to

ignore the imports made by M/s Amara Raja Batteries and

include the company in the definition of domestic industry for

the purpose of filing the petition because the value of imports

was less than 0.1% of the turnover of the company and 0.25%

of the total imports into India of subject goods. However, during

the verification visit to the premises of M/s Amara Raja

Batteries, it came to the notice that the imports made by them

during the period of investigation are not from the subject

countries under investigation but from other countries.

Therefore, M/s Amara Raja Batteries clearly falls within the

definition of domestic industry as per Anti Dumping Rules.

12. It was recorded in the Initiation Notification that "it has

been stated by the domestic industry that the statistics in the

case of lead acid batteries are compiled in terms of number of

units. But denoting the volume in terms of number of units may

be misleading because different models have different power

capacity and value. Apart from denoting the product in terms of

units and value, it will be useful to have the information on the

product in terms of lead content as there is a direct correlation

between power and lead content of the battery which also gets

reflected in terms of value or price.

The direct correlation

between the lead content in the battery and its associated costs

and prices is also quite significant.

It will, therefore, be

meaningful to assess the volume, value as well as lead content of

the product for the purpose of calculation and comparison of

various parameters".

13. It has been stated that the arguments given by the

petitioners for the purpose of determination of their standing to

file the petition on behalf of the domestic industry, are erroneous

and full of presumptions. It has been stated that there is no

relationship between lead production and consumption in India

and the actual production of lead acid batteries in India. Also the

petitioners may use or may not use domestic lead for battery

production as lead produced in India may not be technically

suitable for battery production. On this basis, it is argued that

the petitioner relied on assumption, presumption and not reliable

and verifiable data and figures to qualify themselves as domestic

industry in the anti dumping proceedings. Though arguments

have been made disputing this

claim

of standing of the

petitioners on domestic industry but none of the interested

parties has come up with any evidence proving that the

-K)

THEGAZbiriEOFINDIAiEXTRAORDINARY

|PARI I—SEC. 1]

petitioner companies do not have the standing to file the

petition. Here, it may be mentioned that the Authority has also

used the information provided by sources other than the

petitioner companies for arriving at a decision regarding the

standing of the petitioners to file the petition on behalf of the

domestic industry.

The information

provided by the

administrative Ministry and other sources corroborates the claim

of the petitioner companies of accounting for more than 25% of

the 'domestic industry' as defined in the Anti Dumping Rules.

The Authority, therefore, determines that the petitioner

companies account for a major proportion of the domestic

industry and have the standing in terms of the provisions of the

Anti Pumping Rules.

ADEQUACY AND ACCURACY OF INFORMATION

AND

ISSUE OF CONFIDENTIALITY:

14. It has been argued by a number of interested parties that

the Authority did not satisfy itself about the adequacy and

accuracy of information submitted by the Domestic Industry and

the petition filed was not in the form and manner prescribed.

Also it has been argued that the vital information and a number

of vital documents have been kept confidential by the petitioner

companies depriving the opposing interested parties of the right

to challenge the information and make meaningful submissions

to the Authority.

15. The petition filed by the petitioner contained sufficient

information on various parameters evidencing existence of

dumping, injury and causal link.

However regarding the

information being made available to the opposing interested

parties the provisions regarding confidentiality have to be kept in

mind. Rule 7 of the Anti Dumping Rules provides for

submission of

information by the interested parties on

confidential basis subject to the conditions laid down therein.

The non confidential summary of the information submitted on

confidential basis is placed in the Public File which is available

for inspection by all interested parties in terms of Rule 6(7) of

the Anti Dumping Rules. In this case also non-confidential

summary of the confidential submissions made was placed in

the public file accessible to all the interested parties.

PROVISIONS OF SAPTA

16. It has been argued by some of the interested parties that

export of lead acid batteries from Bangladesh is covered under

SAARC Preferential Trading Arrangement SAPTA) of which

India is also a signatory. It has further been stated that the

Article 14 of SAPTA Agreement provides for specific procedure

for safeguard measures in the event of concession with respect to

preference under the SAPTA Agreement causing or threatening

to cause any injury to the Member Countries. It has been

submitted that the procedures of SAPTA should be exhausted

before initiating procedures under any other forum. It has also

been submitted that if the consultative and dispute settlement

provisions of SAPTA is not adhered to by the contracting States,

the efficacy of the legal regime established through the SAPTA

will be destroyed. It is further submitted that adhering to the

dispute settlement procedures of SAPTA is imperative because

the lead acid batteries are exported from Bangladesh to India

under the provisions of SAPTA and hence the consultation

procedures of SAPTA should be adhered to in settling disputes

arising out of exports under SAPTA.

17. The investigation is for determination of whether exports

are being made to India by the subject countries below the

normal value on the basis of evidence available before the

Authority. There is no allegation or averment by the domestic

industry of injury being suffered on account of concessions

under SAPTA and no request for withdrawal of concession on

lead acid batteries under SAPTA by the domestic industry. The

anti dumping investigation was initiated under the Anti

Dumping Rules of India which are compatible with the WTO

Agreement on Anti Dumping Practices. The SAPTA does not

prohibit any such action by the SAARC Member Countries and

the provisions of Article 14 of SAPTA are also not applicable in

the present case. Also there is no provision under Anti Dumping

Rules to exempt member countries of SAPTA from anti

dumping investigations.

763GI/2001—6

THE GAZETTE OF INDIA; EXTRAORDINARY

[Purr I—SEC. 1]

CORRECTNESS OF FIGURES OF IMPORTS IN

INDIA FROM BANGLADESH

18. The Authority notes that the exporters from Bangladesh

and the importers of subject goods from Bangladesh have argued

that the information provided by the Directorate General of

Commercial Intelligence & Statistics(DGCI&S) regarding

imports from Bangladesh is not reliable. In their submissions

Bangladesh Accumulator and Battery Manufacturers Association

(BABMA) have stated

that number of pieces and value of

exports from Bangladesh to India (volume 275480 pieces, value

Rs.26239814) as given in the petition on the basis of the

DGCI&S data is incorrect. They have stated that the actual

exports from Bangladesh to India have been 54203 pieces for a

total value of US$789745 during the period of investigation

which is 1st January, 2000 to 30 September, 2000. Here the

Authority notes that the figures mentioned in the petition relate

to the period 1st April, 1999 to 31^st March, 2000 and are thus not

comparable with the figures mentioned by BABMA. However

for the purpose of determination, the Authority has used the

information given by BABMA regarding the number of pieces

and the value of exports from Bangladesh to India.

DEMINIMIS VOLUME:

19. As per Rule 14(d) of the Anti Dumping Rules, the

investigations are to be terminated only if the volume of dumped

imports, actual or potential, from a particular country accounts

for less than three per cent of the imports of the 'like product¹.

The deminimus limit is with respect to total volume of import

and not with respect to the volume of locally manufactured

product as claimed by some of the interested parties.

20. In the Preliminary Findings on the basis of information

compiled by DGCI&S, it was found that the imports from

Bangladesh accounted for less than 3 per cent of the

value/volume of import of the subject goods to India and

therefore, for the purpose of preliminary findings, the imports

from Bangladesh were determined as de minimis pending further

investigation. It was also stated that number of batteries is not a

good indicator of the volume of imports, there being batteries of

various sizes and types, it is only in terms of value that the de

minimis criteria can be applied.

21.

Subsequent to the Preliminary Findings, the Domestic

Industry as well as the exporters from China and Korea have

argued that the volume of imports from Bangladesh to India

during the period of investigation was more than de-minimis

especially in the automotive sector which is only type of lead

acid battery being exported to India from Bangladesh even as

per the admission of BABMA. They have argued that not only

as a percentage of total import of lead acid battery is import

from Bangladesh more than 3% but if only imports of

automotive lead acid batteries are taken into account,

Bangladesh accounts for a very large share of the imports of

automotive batteries into India.

22. The Authority sought detailed transaction-wise information

from DGCI&S, containing therein information with regard to,

inter-alia, Bill of Entry number, date, name of importer,

quantity, value of imports, port of consignment etc.. At the same

time, the exporter from Bangladesh has also provided

transaction-wise information on 31^st May, 2001 with regard to its

exports through BABMA. Using the information provided by

BABMA with regard to exports made from Bangladesh, the

Authority notes that the value of exports made by Bangladesh

are more than de-minimis.

The value of exports from

Bangladesh was US$789745 during the period of investigation

which is equivalent to Rs.3.5 crores approximately.

As a

percentage of total imports into India during the period of

investigation of Rs.53 crores, this comes to 6% which is more

than the de-minimis limit of 3%. The figure of total imports is

based on DGCI&S data duly adjusted for import data for

Bangladesh.

DUMPING :

23. As brought out in the preliminary findings, the Designated

Authority sent questionnaires to known exporters of the subject

goods in subject countries. The Authority makes the following

observations on the submissions made by the exporters in this

regard.

THE GAZETTE OF INDIA: EXTRAORDINARY

|PM<II—SEC. 1|

24.

Exporters from Japan: From Japan, M/s Yuasa

Corporation had made their submissions and furnished relevant

information. However, it was stated in the preliminary findings

that the information provided by M/s Yuasa Corporation was

deficient on a number of grounds such as absence of information

on the domestic sales of lead acid batteries, incomplete details in

Appendix 3 & 7 non submission of details regarding marketing

arrangements with the trading company etc..

However, no

submissions have been received from M/s Yuasa Corporation,

Japan subsequent to the preliminary findings. Thus Rule 6(8) is

attracted in case of the exporters from Japan and the Designated

Authority is fully justified in proceeding with investigation on

the basis of

best information available for the purpose of

calculation of dumping margin.

25.

Response filed by exporters from Bangladesh: On the

initiation of investigation, copy of the questionnaire along with

the initiation notification was sent to the High Commission of

Bangladesh in India and two exporters from Bangladesh whose

addresses were provided by the domestic industry. These two

exporters informed the Authority that they have not exported

lead acid batteries to India during the period of investigation. In

the

communication

addressed

to High Commission

Bangladesh a request was made to inform all the exporters of

subject goods from Bangladesh about the investigation and

request them to file information in the prescribed questionnaire

within forty days of the initiation of the investigation.

Information was received from M/s Bangladesh Accumulator &

Battery

Manufacturers

Association(BABMA),

Dhaka,

Bangladesh who informed that M/s Rahimafrooz Batteries Ltd.,

one of their members has been exporting lead acid batteries to

India. No information was received in the prescribed format

from M/s Rahimafrooz Batteries within forty days time limit

after initiation. Even after the Preliminary Findings which were

issued on 21.3.2001, required information was not submitted

within the 40 days time limit prescribed. However, information

in the prescribed questionnaire regarding the exports made by

M/s Rahimafrooz Batteries along with the other details was

submitted

Bangladesh

Accumulator

and

Battery

Manufacturers Association on behalf of the exporter, M/s

Rahimafrooz Batteries on 31.5.2001 which was incomplete and

deficient. Both the Association and the exporter were informed

of the deficiencies in the submissions and requested to complete

their submission by furnishing the required information

alongwith the documentary evidence and copies of the financial

statements such as profit and loss account, balance sheet, annual

report etc.. Also, the exporters were requested to give their

consent for on the spot verification of information submitted by

the Authority at their premises.

26. In reply to the request for information made by the

Authority, the exporter from Bangladesh stated that disclosure of

such information will put them in a serious disadvantageous

position because their strategic plan will be revealed through the

financial statement to their competitors. Also they have further

stated that provision of WTO Agreement do not explicitly give

any authority to the Member States to require exporters to

provide financial statements. It was also stated that since the

complainant domestic industry has not provided similar

information, they are not going to make this available to the

Authority. The exporter also expressed reservations regarding

giving their consent for verification visit by the verification team

of the Authority to their premises for on the spot verification of

the information submitted by them.

27. Exporters were informed by the Authority that "there is a

provision for submission of required information on confidential

basis along with non-confidential summary. The claim of

confidentiality on the information submitted by interested party

imposes an obligation on the investigating authorities not to

disclose such information to any other party including the

opposite parties. If they require certain information to be kept

confidential and not made accessible to the competitors, they

may

submit

accordingly.

Non-submission

of required

information including financial statements is considered as non-

cooperation and the investigating authority has the option to

make determination on the basis of the facts available as per the

Article 6.8 of the WTO Anti Dumping Agreement. Regarding

the consent for on the spot verification, their attention was

THE GAZETTE OF INDIA: EXTRAORDINARY

|I'\KI 1—SFC. 1]

invited to Article 6.7 of the WTO Agreement on

Implementation of Article VI of GATT wherein it is stated that

in order to verify information provided or to obtain further

details, the authorities may carry out investigations in the

territory of other Members as required, provided they obtain the

agreement of the firms concerned and notify the representatives

of the government of the Member in question and unless that

Member objects to the investigation. The procedures described

in Annex I of the Agreement applies to investigations carried out

in the territory of other Members".

28. Apart from the deficiencies mentioned above, the exporter

has not replied at all to the descriptive part of the questionnaire

and has not furnished information relating to legal form of the

company, details of owners/shareholders, information on the

incentive given by the Government etc.. Also the transaction-

wise details of the sales in the home market with a break-up in

terms of type of batteries, specification details of the batteries

being exported, details regarding the cost of production in the

format C(2) and C(3) of the Questionnaire, description of the

accounting practices followed, etc. have not been given.

Exporter has refused to furnish the information relating to the

two years preceding the period of investigation and provide

copies of profit and loss statement and balance sheet and annual

reports to the Authority.

29.

Even though the exporter has provided information on

capacity, production, sales and stock, the same has become

redundant and useless in the absence of other information in

terms of Appendices 1 to 3. Further, this information provided

by the exporter is in respect of all the batteries combined without

identifying the various types of batteries. Thus, while they have

argued at length about non-comparability of various types of

batteries, the exporter has preferred to give information on

cumulative basis at some places and battery-wise at other places.

30. Information on sales price structure provided by the

exporter vide Appendices 4 and 5 are unsubstantiated. Other

data (such as Appendix 2) cannot support this data, since other

data provided by the exporter does not identify type of battery

involved. It is thus not feasible to reconcile the information in

Appendices 4 & 5 with various other information provided by

the exporter. Since home market sales have not been provided,

the sale price structure for sales in the home market remains

unsubstantiated.

Appendices 4 and 5 thus merely become

statement,

unsubstantiated

with

relevant

evidence

and

unsupported with other data/information provided by the

exporter. Further, the exporter has not extended its willingness

to offer itself for verification as stated above.

31.

In Civil Appeal No. 487 of 2000 (Designated Authority vs.

M/s Haldor Topsoe A/S), the Hon'ble Supreme Court has

determined that refusal of the exporter to give required

information amounts to non-cooperation and the Authority is

justified in proceeding to determine the normal value on the

basis of the 'best judgment assessment' as contemplated under

Rule 6(8) of the Anti Dumping Rules. Rule 6(8) of the Anti

Dumping Rules reads as follows: 7/7 a case where an interested

party refuses access to, or otherwise does not provide necessary

information within a reasonable period, or significantly impedes

the investigation, the designated authority may record its

findings on the basis of the facts available to it and make such

recommendations to the Central Government as it deems fit

under such circumstances'.

32. Article 6.8 of WTO Agreement on Implementation of

Article VI of the GATT 1994(Agreement on Anti Dumping

Practices) also reads as 7/7 cases in which any interested party

refuses access to, or otherwise does not provide, necessary

information within a reasonable period or significantly impedes

the

investigation, preliminary

and final determination,

affirmative or negative, may be made, on the basis of facts

available'.

33. The exporters from Bangladesh have not responded to the

questionnaires within the prescribed time limits, have failed to

provide the information called for and also have refused access

to necessary information, as requested by the Authority. In view

of the above, the Authority considers them as non-cooperative

_ _ _

THF, GAZETTE OF INDIA EXTRAORDINARY

|Pwi I—Sr<". 1|

and has made the determination on the basis of best

information available in terms of Rule 6(8) of Rules Sapra.

34. M/s

Shenyang

Matsushita

Storage

Battery

Co.

Ltd.(SLMB),China: Subsequent to Preliminary Findings, M/s

Shenyang Matsushita Storage Battery Co. Ltd., China(SLMB)

have given information for all the models of lead acid batteries

being manufactured by them as requested by the Authority.

Also the information regarding the domestic sales including for

those models not being

exported to

India has also been

furnished. The respondent has manufactured and exported only

industrial lead acid batteries during the period of investigation.

The exporter has furnished the information for all the domestic

sales to all the customers during the period of investigation in

the prescribed format. The exporter has also furnished

the

required information for Appendices 1, 2 3 & 7 which has been

verified and reconciled. The exporter has also furnished

information regarding the details of expenses incurred by M/s

Asia Matsushita Electric (s) Pte. Ltd., through which exports

have been made to India. Also details

of group companies

through which the sales are being made in China have been

furnished. The company has claimed adjustments on account of

VAT, insurance, freight, duty drawback, handling charges,

shipping charges on the basis of actual expenses which have

been verified and allowed. Adjustments claimed on account of

credit expenses have not been allowed as it was not possible for

the exporter to give a clear apportionment of the same among

various models and sales. Details regarding cost of production of

each model have also been provided which have been verified.

Sales for each model are above cost of production taking into

account all elements of cost and thus are in the ordinary course

of trade. The company has also furnished non-confidential

summary of the information submitted. The export price and

normal value of the exports have been worked out on the basis

of the information furnished and verified by the Authority. The

export price and normal value after adjustments of each model

exported to India have been compared individually for arriving

at individual dumping margin and then a weighted average of

these individual margins has been taken for calculating overall

average dumping margin. It has been represented to the

Authority with sufficient evidence that the name of M/s Asia

Matsushita Electric (S) Pte. Ltd., has been changed. Now the

exports of industrial lead batteries of M/s SLMB are being done

through the new company M/s Panasonic Industrial Asia Pte.

Ltd., Singapore.

35. M/s BB Battery Co. China: M/s BB Battery Co. China

has rectified

deficiencies in the information submitted. They

have furnished information regarding all the models and also

for all the customers to whom the lead acid batteries have been

sold. Also the information regarding National Trading Ltd., i.e.,

the trading company that owns M/s BB Battery and exports lead

acid batteries to India has been furnished. Further information on

the installed capacity in terms of Appendix 7, technical

specifications of the various models and types of lead acid

batteries being manufactured by th#- company have also been

furnished. The respondent has manufactured and exported only

industrial lead acid batteries during the period of investigation.

During the verification of the company, it was observed

that the company is 100% export unit and even the sales within

China are either against import permit or to other export units

using lead acid batteries for manufacture of export products.

Such sales cannot be taken as domestic sales for the purpose of

arriving at normal value. As per Section 9A(1)(C) of Customs

Tariff Act, the normal value has to be determined on the basis of

the comparable price in the ordinary course of trade for the Like

Article when meant for consumption in the exporting country

or territory. However, when there are no sales of Like Article in

the ordinary course of trade in the domestic market of the

exporting country or territory or under such conditions as

specified, the normal value shall be either export price to

appropriate third country or a price based on the cost of

production of the said article in the country of origin along with

reasonable addition for administration, selling and general costs

and for profits. In the instant case, there are no domestic sales

by the exporter i.e., M/s B.B. Battery Co. The price of the

domestic sales of other exporters from China cannot be

considered as representative comparable price as the product is a

branded product and each brand represents a particular image in

3763 GI/2001—7

50_

THE GAZETTE OF INDIA : EXTRAORDINARY

[PARI I—Sbc. 1]

the minds of the customer because of differences in

performance, technology etc.. Hence, it will not be appropriate

to compare the export price of M/s BB Battery Co., with the

domestic sales price of other manufacturers of industrial lead

acid batteries in China. After considering facts of the case and

the circumstances, the Authority has decided to determine the

normal value

in case of these exporters in terms of option

available to it under Section 9A(l)(C)(ii)(b) i.e., on the basis of

cost of production of the concerned exporter. The Authority has,

therefore, decided to use the constructed normal value for the

purpose of comparison with net export price and arriving at

dumping margin.

In the export price, the company has claimed adjustments

on account of inland freight, overseas freight, overseas insurance

and clearance

& handling charges on the basis of actual

expenses which have been allowed after verification. It has been

explained by the exporter that variation in overseas freight,

insurance etc., for different types of batteries is because of

different market lot. The comparison of normal value and

export price has been done individually for each model exported

to India and weighted average of these individual

dumping

margins has been taken for arriving at average overall dumping

margin.

36. M/s Shenzen Senry Battery Co. Ltd., China: In their

submissions, subsequent to preliminary findings, exporter has

explained that M/s Shenzen Centre Power Tech. Co. Ltd., which

is holding their shares, is not allowed to export but has the rights

to make supplies to the Government departments in China. M/s

Shenzen Senry Battery Co., Ltd., is manufacturing batteries and

exporting to India alongwith other countries apart from selling in

the domestic market. However, for sales to the Government

departments in China, the sales are made through M/s Shenzen

Center Power Tech Co Ltd..

The exporter has also complied with other deficiencies

pointed out in the preliminary findings, i.e., giving ^11 the details

in Appendices 1 to 3 & 7 and reconciled the same, providing

technical details on different types of lead acid batteries and

furnishing annual financial statements.

Non-confidential

version of their submissions has also been furnished. The

respondent has manufactured and exported only industrial lead

acid batteries during the period of investigation.

In the export sales, adjustments have been claimed on

account of inland freight and handling charges on the basis of

actual expenses which have been allowed. No adjustments have

been claimed in the domestic sale for arriving at the normal

value. Since M/s Shenzen Centre Power Tech Co. Ltd. is a

company related to exporter, for the purpose of normal value,

resale price of M/s Shenzen Centre Power Tech Co. Ltd to

independent buyer has been taken as the actual selling price.

Since all the sales are above cost of production, these are being

considered as being in the ordinary course of trade. The

comparison has been made for each model separately and

weighted average of these individual margins has been taken for

arriving at overall average dumping margin. The export price

and normal value have been calculated on the basis of revised

information

submitted by the exporter and verified by the

Authority.

37. M/s Global & Yuasa Battery Co Ltd., Korea: In the

revised submission made after the preliminary findings,

complete information has been given by M/s Global & Yuasa

Battery Co Ltd., Korea for all the models of lead acid batteries

being manufactured and also for all the customers in the

domestic market as well as export to India and third countries.

The details regarding technical specifications of the batteries

have also been given and non-confidential summary of the

confidential submissions has also been submitted.

The domestic sales of all the models have been made

above cost of production and are in the ordinary course of trade.

Average domestic sale price for each model has been taken for

purpose of arriving at normal value for that model. Exporter

claimed adjustments on account of physical differences, VAT,

packing charges,

inland freight, volume rebate, advertising,

warranty claim, installation cost, selling expenses, credit

expenses, cash compensation, duty drawback and commission.

_ _ _

THE GAZETTE OF INDIA: F.XTRAORDINARY

|PAKTI—SKC. 1|

These adjustments have been allowed on the basis of actual

expenses or receipts and have been verified and allowed by the

Authority.

The dumping margins have been calculated

separately for each model being exported to India and weighted

average of these individual dumping margins has been taken for

the purpose of arriving at an overall dumping margin.

As per para 6(i) of Annexure I to Anti Dumping Rules,

which outlines the Principles governing the determination of

Normal Value, the Export Price and Margin of Dumping, "Due

allowance shall be made in each case, on its merits, for

differences

which

affect

price

comparability,

including

differences in conditions and terms of sale, taxation, levels of

trade, quantities, physical

characteristics,

and any other

differences

which

are

demonstrated

affect

price

comparability'¹.

In the instant case, the adjustments have been

claimed on account of the actual physical differences in the

models in the automotive segment being exported to India and

being sold domestically. Other adjustments like packing cost,

inland freight, volume rebate and due allowances incurred due to

differences in trade level from Indian customers and conditions

& terms of sales like advertising and sales promotion expenses,

warranty claim expenses, delivery installation costs, credit

expenses and selling expenses. M/s Global & Yuasa Batteries

performs advertising and sales promotional activities in the

domestic market only and also claims responsibilities for

warranty claim amount for domestic customers which is not

done for Indian customers.

Similarly, for industrial users, in

home market, M/s Global & Yusasa Batteries, performs

installation of industrial batteries to their locations. Also for

domestic market, M/s Global & Yusasa Batteries, deals directly

with the wholesalers who are scattered throughout the country

and the company has to maintain its head sales office, regional

sales office, warehouses and after sales centres, expenses of

which have been claimed as selling expenses which is not the

case for the export sales to India. Also the sales to the domestic

customers is mostly on credit terms, which is not the case for

sales to Indian customers. Regarding the volume rebate, M/s

Global & Yusasa Batteries, has long term volume rebate

agreement with the dealers in the domestic market which is

known in advance. All these adjustments have been allowed

on the basis of actuals after verification.

38. M/s Delkor Corpn., Korea: M/s Daewoo International

Corporation, Korea through whom all the exports have been

made to India by M/s Delkor Corporation., Korea, have

furnished a price undertaking for maintenance free automotive

lead acid batteries which has been accepted by the Authority.

The undertaking is binding on M/s Daewoo International

Corporation, Korea for the export to India of automotive lead

acid batteries manufactured by M/s Delkor Corporation., Korea.

In view of the acceptance of the price undertaking, the

investigations against M/s Delkor Corporation., Korea have been

suspended.

39. M/s NB Corporation, Korea: In the revised submission

by M/s NB Corporation, Korea, after the preliminary findings,

all the details of transaction wise sales in the domestic market,

technical specifications of different types of lead acid batteries,

information regarding installed and utilised capacities have been

furnished.

The exporter has complied with the deficiencies

pointed out in the preliminary findings. The respondent has

manufactured and exported only industrial lead acid batteries

during the period of investigation.

The sales of different modes are above cost of production

and hence, in the ordinary course of trade. The domestic selling

price, therefore, has been used for arriving at normal value. The

exporter has claimed adjustments on account of ocean freight,

ocean insurance and duty drawback which had been allowed on

actual basis after verification. However, adjustments claimed on

the domestic selling price on account of credit sales, volume

discount,

commission, warranty claims, etc., have not been

allowed as specific allocation & apportionment for each model

could not be established by the exporter. The normal value and

export price of each model has been calculated separately and

compared for the purpose of arriving at individual dumping

margin. Weighted average of individual dumping margins have

been taken for arriving at overall dumping margin.

THE GAZETTE OF INDIA - EXTRAORDINARY

| P \i< i 1—SIT 1|

40. Assessrtient of non-cooperative exporters from China

& Korea.: For exporters other than those who have cooperated

with the Authority, it has been decided to make recommendation

regarding imposition of duty on the basis of best information

available in terms of Rule 6(8) of Anti Dumping Rules. For the

export price, the information provided by the importers and

Directorate

General

Commercial

Intelligence

Statistics(DGCI&S), Kolkata has been used. The constructed

normal value has been compared with the adjusted export price

for arriving at the dumping margins.

41.

Dumping Margins : The dumping margins calculated as

per the methodology and information mentioned above for

exporters and manufacturers of subject countries for industrial

and automotive (Maintenance Free i.e. MF, Non Maintenance

Free i.e. NMF and Motorcycle) are as follows :

Peoples Republic of China

Type of battery

1. Industrial

2. Automotive

(i) NMF

(ii) MF

(iii)Motorcycle

Exporter/manufacturer

1 .M/s

Shenyang

Matsushita

Storage Battery Co. Ltd(SLMB)

2.M/s BB Battery Co.

3.M/s Shenzen Senry Battery Co.

Ltd.

4.Other exporters/manufacturers.

All exporters

Dumping

margin(%)

-2.758

-5.780

-0.007

107.41

46.41

Republic of Korea

Type of battery

1. Industrial

2. Automotive

(i) NMF

(ii) MF

(iii) Motorcycle

Exporter/manufacturer

1. M/s Global & Yuasa Battery

Co. Ltd.,

2. M/s NB Corporation

3. Other exporters/manufacturers.

I.M/s Global & Yuasa Battery

Co. Ltd

2.Other exporters/manufacturers

l.M/s Global & Yuasa Battery

Co. Ltd

2. M/s Delkor Corpn.,

3. Other exporters/manufacturers

All exporters

Dumping

margin(%)

-5.460

-3.766

107.97

3.600

121.53

2.891

121.53

Peoples Republic of Bangladesh

Type of battery

1. Industrial

2. Automotive

(i) NMF

(ii) MF

(iii) Motorcycle

Exporter/manufacturer

All exporters

Dumping

margin(%)

32.00

29.68

32.00

THE GAZETTE OF INDIA : EXTRAORDINARY

[P\KTI—SF.-, Ij

Janan

Type of battery

1. Industrial

2. Automotive

(i) NMF

(ii) MF

(iii) Motorcycle

Exporter/manufacturer

All exporters

Dumping

margin(%)

42.07

53.77

Here it may be mentioned that if a particular type of battery was

not exported from a particular country during POI, the maximum

dumping margin determined, of types of battery exported has

been indicated as the margin of dumping for that type as well.

INJURY AND CAUSAL LINK

42.

A number of interested parties opposing the anti dumping

investigation have given their views regarding injury being

suffered by domestic industry and the causal link between

dumping and injury. It has been argued that both the petitioner

companies i.e., M/s Exide Industries Ltd., and M/s Amara Raja

Batteries Ltd., are enjoying growth and prosperity and there is

no evidence of loss of contracts. It has been argued that sales

volume of the domestic industry has increased and the

profitability is being maintained. Also it has been argued that

the quality of the domestic industry is poor as compared with the

batteries being imported from the subject countries. Tt has also

been argued that M/s Exide Industries Ltd., is selling batteries in

the OEM market at very low prices and in the replacement

market these are being sold at almost three times the price of

OEM market. Also M/s Exide Industries Ltd., is selling under

DGS&D Rate Contract at prices significantly below the import

price. It has also been argued that the domestic industry is

operating at far above its installed capacity and is unable to meet

the requirement of the Indian market, especially in some of the

ranges which are not being produced by them at all. The other

arguments are that imported batteries are preferred, specially in

the UPS segment due to their better performance, range, service

and reliability as compared to the Indian batteries and also the

importers are paying very high rates of customs duties. It has

also been stated that due to decline in the automotive segment

especially in the tractor and commercial vehicle segment, there

has been a fall in demand causing injury to the domestic

industry. The contraction in demand due to industrial recession

in the economy and the change in the pattern of consumption are

the causes of injury to the domestic industry in addition to a

number of company specific parameters.

43.

The Authority has taken into account all indices regarding

injury while doing the final determination. This involves all

relevant facts viz., volume of dumped imports, their effect on

price in the domestic market and its subsequent effect on

domestic

producers,

production,

capacity

utilisation,

profitability, net sales realisation etc.

While determining the

non-injurious price for the like article for the domestic industry,

the Authority has considered the optimum cost of production for

the domestic industry which takes into account the normated

best consumption norms and also takes into account the actual

price of the raw materials during the POI which go into the

production of the product under consideration. Also, while

arriving at the injury margin, the Designated Authority has taken

account optimum capacity utilisation for arriving at a fair selling

or non injurious price.

44.

In addition to the material injury inflicted by the dumped

imports on the domestic industry, the Authority has examined

the allegation of dumped imports causing thereat of material

injury to the domestic industry.

The parameters examined

relating to threat of material injury are

(a)

Whether there is a significant increase in the imports

in a relatively short time and whether there was a

significant rate of increase in the dumped imports

from subject countries indicating the likelihood of

further imnorts:

37R3GI/2001—8

THE GAZETTE OF INDIA : EXTRAORDINARY

|PARTI—SFA 11

(b)

Whether the imports were causing severe price

undercutting in the market;

(c)

Whether the exporters from subject countries have

significant freely available capacities;

(d)

Whether the exporters are holding

significant

inventories of the subject goods and whether

inventories of the subject goods are rapidly

increasing with the domestic industry and their

stockists/dealers.

45. Cumulative Assessment of Injury : The conditions for

cumulative assessment of effect of dumped imports as specified

in Annexure II to the Anti Dumping Rules are satisfied in this

case. Since the volume of import from Bangladesh is more than

the prescribed deminimis limit, the imports from Bangladesh

have also been included for the cumulative assessment of injury

suffered by domestic industry alongwith the imports from China,

Korea and Japan as done in the Preliminary Findings.

46. Material Injury & Threat of Injury : The following

parameters reveal that the domestic industry has suffered

material injury from the dumped imports and also that there is

threat of further injury being caused by dumped imports.

(i)

Imports have increased in absolute terms from Rs. 23.5

crores in 1998-99 to approximately Rs. 30 crores (Rs. 40

crores annualized) in the investigation period.

(ii)

The rate of growth of imports of subject goods is more

than the rate of growth of domestic production.

(iii) Though there has been an increase in production and the

sales volume in absolute terms of the domestic industry,

but the market share of domestic industry in the Indian

market has declined on account of substantial increase in

imports from subject countries. There has been decline in

the market share of the domestic industry both in the

automotive as well as industrial segments. The domestic

industry has lost substantial sales to imports from subject

countries.

(iv) Inventories of the subject goods with the domestic industry

have increased. The increase in inventories is found with

both the petitioner companies.

(v)

The average collection period of outstanding petition

companies increased during the period of investigation.

(vi) One of the petitioner companies introduced Voluntary

Retirement Scheme for its employees and reduced

employment.

(vii) Profitability

of both the petitioner companies has

significantly

declined during the period of investigation

which is also reflected

in the

fall

in return on

investments.

(viii) The domestic industry had to reduce the selling prices to

match the prices of dumped imports. There has been a fall

in the average sales realisation of the petitioner companies.

(ix) The dumped imports were severely undercutting the prices

of the domestic industry. The undercutting is found in

both the automotive and industrial segments.

(x)

There has been a significant increase in imports in

relatively short time and also rate of growth of dumped

imports from subject countries has been increasing.

(xi) Exporters from subject countries are having surplus

unutilised capacities.

47. Causal Link ,: The factors affecting the performance of

domestic industry and the resultant injury such as contraction of

demand specially in the automotive segment, change in the

pattern of consumption, the consumption preference for

maintenance free batteries as compared with non-maintenance

free batteries etc., have been considered while making analysis

of the causal link between the injury being suffered by the

domestic industry and dumping of the subject goods from

THE GAZETTE Or INDIA . EXTRAORDINARY

|PVKI I— Si.-. 11

subject countries.

In determining whether injury to the

domestic industry was caused by the dumped import, the

Authority has taken into account the factor that it is the dumped

import at dumped prices which has forced the domestic industry

to reduce its prices.

Therefore, the causal link between the

dumped imports of subject goods from China, Korea, Japan and

Bangladesh and injury suffered and threat of injury being faced

by the domestic industry is clear.

The Authority, therefore,

concludes that there is a causal link between the dumping of

subject goods from China, Korea, Japan and Bangladesh &

injury suffered and threat of injury being faced by the domestic

industry' during the period of investigation.

48.

Landed Value: Landed Value of imports for the purpose

shall be the assessable value as determined by the Customs

under the Customs Act, 1962 and all duties of customs except

duties under Sections 3, 3A, 8B and 9A of the Customs Tariff

Act, 1975.

FINAL FINDINGS:

49. After considering the foregoing the Authority concludes that

(i)

Lead Acid Batteries exported to India from China, Korea,

Japan

and Bangladesh are below its normal value during the

period of investigation;

(ii)

The Indian industry has suffered material injury and is

further being threatened with material injury;

(iii) The injury has been caused by the dumped imports from

China, Korea, Japan and Bangladesh;

50.

The Authority proposes to recommend the amount of anti

dumping duty equal to the margin of dumping or less, which if

levied, would remove the injury to the domestic industry. For the

purpose of determining injury, the landed price of imports is

proposed to be compared with the non injurious selling price of

the petitioner

companies

determined

for

the period

investigation.

51. The Authority recommends imposition of definitive anti

dumping duty on all imports of lead acid batteries falling under

Custom Code 8507 originating in or exported from China,

Korea, Japan and Bangladesh. As already determined in the

preliminary findings, anti dumping duty shall be the difference

between the amount mentioned in Column 3 of table given

below and landed value of import per kg of the lead acid battery

for the exporters/manufacturers from the China, Korea, Japan

and Bangladesh:

Peoples Republic of China

Type of battery

1. Industrial

2. Automotive

(i) NMF

(ii)MF

(iii) Motorcycle

Exporter/manufacturer

1 .M/s Shenyang Matsushita Storage

Battery Co. Ltd(SLMB) manufacturer

or exports through trading company

namely, M/s Panasonic Industrial

Asia Pte. Ltd., Singapore.

2. M/s BB Battery Co., manufacturer

or exports through trading company,

namely, M/s National Trading Ltd.,

Hong Kong.

3. M/s Shenzen Senry Battery Co.

Ltd.

4. Other exporters/manufacturers.

All exporters

Amount

in US $

per kg.

N.A.

3.192

2.532

2.121

3.930

I — S i • • <

1 1

Republic of Korea

Type of battery

1. Industrial

2. Automotive

(i) NMF

(ii) MF

(iii) Motorcycle

Exporter/manufacturer

l.M/s Global & Yuasa Battery

Co. Ltd.,

2. M/s NB Corporation

3.Other exporters/manufacturers.

I.M/s Global & Yuasa Battery

Co. Ltd

2.Other exporters/manufacturers

l.M/s Global & Yuasa Battery

Co. Ltd

2. M/s Dclkor Corpn.,

3. Other exporters/manufacturers

All exporters

Amount

in US $

per kg.

N.A.

3.192

2.216

2.532

1.904

N.A.

2.121

3.930

Peoples Republic of Bangladesh

Type of battery

1. Industrial

2. Automotive

(i) NMF

(ii) MF

(iii) Motorcycle

Exporter/manufacturer

All exporters

Amount in

US $ per

kg-

3.192

2.532

2.121

3.930

Jaoan

Type of battery

1. Industrial

2. Automotive

(i) NMF

(ii) MF

(iii) Motorcycle

Exporter/m anufacturer

All exporters

Amount in

US$

per kg.

3.192

2.532

2.121

3.930

Here, it may be mentioned that "MF" means "Maintenance

Free" i.e., filled with electrolyte and ready to use "NMF" stands

for "non-maintenance free" and N.A. means Not Applicable.

52. Landed value of imports for the purpose shall be the

assessable value as determined by the customs under the

Customs Act, 1962 and all duties of customs except duties levied

under Section 3, 3A, 8B, 9 and 9A of the Customs Tariff Act,

1975.

53.

Subject to the above, the Authority confirms the

preliminary findings dated 21.3. 2001.

54.

An appeal against this order shall lie before the Customs,

Excise and Gold(Control Appellate Tribunal) in accordance with

the Act, supra.

L V SAPTHARISHI, Designated Authority

Printed by Hie Manager. Cio\( ni India Press, Ring Rimd, Mnyapun. New Dellu-11()()ft4

and Published by llio Cunlmllcr of Publications. Delhi-110()?4