ADCTA wins round 1; Dell in deep waters?

The ongoing tussle between Dell India, Delhi based ADCTA and the bunch of parallel importers have finally come to an end with the Customs Department issuing an 11 pages ruling against Dell India for their unfair trade practice.

The ruling established the fact that Dell India had misused the IPR Border Protection Rule on March 29th. As a result the Customs Department has also uplifted the ban on importing the Dell's laptops and desktops to India.

This entire episode came to the notice when the Office of the Commissioner of Customs Department, Mumbai issued a alert circular (No LRM/TARGET-55/2008-09) with directions that all the consignments found to contain Dell laptops or portable computers shipments, under import by parallel importers are 'subject to be suspended/hold for Dell's clearance in the month of January.' Since then, the Customs Department held back the material at the Mumbai, Delhi and Bangalore airports.

As a result of Dell's enforcement drive, IT traders, mostly Dell partners incurred potential loss in the tune of Rs. 500 Crores in Q3 of FY 11-12. However, according to estimates, the damage could have been more, if other MNCs had followed the same as Dell India, with the estimated loss to Indian consumers crossing Rs. 100000 crores.

Throughout the entire episode, ADCTA has raised this issue time and again with support for the association mostly pouring in around Delhi.

Speaking to The DQ Week, Shyam Modi, chairman, ADCTA said, "We are thankful to the Customs Department for their timely action by issuing order against Dell India and saves potential loss of Rs. 100000 crores to Indian consumers."

All this while, ADCTA submitted several representations to Indian Customs explaining in detail about the alleged "cheating to Indian consumers by Dell India after registering UPRN with misleading and wrong documents."

Due to UPRN registered in Customs all shipments of Dell branded laptops under import were suspended for clearance and Dell India substantially increased the prices of Dell brand laptops in India market.

Moreover, the association was investigating this issue in their own capacity and claimed to have collected substantial evidence to prove their stand.

"After repeatedly requesting Dell India to stop their unfair trade practice, they did not bother to pay heed to our requests. Mahesh Bhalla, (executive director, Dell India) stated that Customs will not clear the importer's shipments without NOC from Dell India and the vendor will not issue any NOC to any parallel importers. Also, Bhalla continuously requested ADCTA to support their (Dell) stand against parallel importers", said Mahinder Aggarwal, president, ADCTA.

The ruling has brought in a much anticipated "troubled time" for Dell with the laptop major finding itself in "deep waters".

"In the next move, we are planning to do something to make up for the potential losses incurred by the importers. Customs Department in their inspection found that the import of goods are found to be genuine and is not prohibited under Indian laws," highlighted Swarn Singh, joint secretary, ADCTA.

The DQ Week also tried to contact a few importers affected by the face off, but none of them were willing enough to comment on the same.

Despite several attempts to reach Dell personnel, The DQ Week could not get timely response from the company.