RoDTEP Benefits for Restricted Exports: A Clarification from the Bombay High Court

The Bombay High Court, in the case of Rika Global Impex Limited v. Union of India and Ors., has clarified that RoDTEP benefits cannot be denied for goods classified as ‘restricted’ for export, provided these exports are undertaken with specific authorization. This ruling prevents arbitrary denial of benefits when exporters comply with regulatory frameworks and obtain necessary permissions for their restricted goods. For Indian professionals and SMEs engaged in export, this decision provides crucial clarity on eligibility for the Remission of Duties and Taxes on Exported Products (RoDTEP) Scheme.

Understanding RoDTEP and Export Classifications

The RoDTEP Scheme is designed to enhance the competitiveness of Indian exports by refunding embedded central, state, and local duties/taxes that are not otherwise rebated. While certain categories of goods, particularly those restricted or prohibited under Schedule 2 of the Export Policy, are typically ineligible, the recent court ruling offers an important distinction. Exports are generally categorised as:

• Prohibited: Exports that are entirely forbidden.
• Restricted: Exports that are not entirely forbidden but are subject to specific conditions, permissions, or quotas.
• Free: Exports that can be undertaken without specific restrictions.

The core contention in the Rika Global Impex Limited case was whether ‘restricted’ exports, when carried out with due authorization, should still be considered ineligible for RoDTEP benefits.

The Rika Global Impex Limited Case: A Detailed Look

Background of the Dispute

Rika Global Impex Limited and other petitioners, engaged in exporting white refined sugar, had been claiming RoDTEP benefits. However, the Union of India subsequently denied these benefits, citing Notification No. 10/2015-20 dated May 24, 2022, which classified sugar as a ‘restricted’ export item. The Respondent argued that this classification rendered the exports ineligible under Notification No. 76/2021-Customs (N.T.) dated September 23, 2021, which excludes restricted or prohibited goods from RoDTEP benefits.

The petitioners countered that sugar export was merely regulated, not prohibited. They highlighted that their exports were conducted with specific permission from the Directorate of Sugar, making the denial of benefits arbitrary. Their grievance stemmed from the fact that despite lawful exports under permission and fulfilling all conditions, RoDTEP benefits were denied, and recovery proceedings were initiated.

The Legal Question

The central legal question before the Bombay High Court was: Are exporters entitled to RoDTEP benefits when goods are classified as ‘restricted’ but are exported with specific permission under the applicable policy and notifications?

Bombay High Court’s Ruling

In Writ Petition No. 2310 Of 2024, dated April 20, 2026, the Hon’ble Bombay High Court delivered a significant judgment:

• Denial is Arbitrary: The Court held that denying RoDTEP benefits for exports permitted under specific authorizations and quota allocations would be arbitrary.
• Nature of Restriction: It clarified that the restriction imposed by Notification No. 10/2015-20 dated May 24, 2022, regulated exports rather than prohibiting them entirely.
• Eligibility Post-Permission: Once exports are permitted under the regulatory framework, they cannot be deemed ineligible for the RoDTEP Scheme benefits.
• Uniformity in Interpretation: The Court emphasised the need for uniformity in interpreting central statutes, advocating for adherence to decisions of other High Courts unless they are per incuriam.
• Entitlement to Benefits: The petitioners were deemed entitled to RoDTEP benefits for their exports conducted with specific permission.
• Directions: The Court directed the grant of RoDTEP benefits where not already provided, along with refunds at 6% interest.

Relevant Provisions and Notifications Impacting RoDTEP Eligibility

Notification No. 10/2015-20, issued on May 24, 2022, under the Foreign Trade (Development & Regulation) Act, 1992, and Foreign Trade Policy, 2015-20, amended the export policy for sugar. Specifically, from June 1, 2022, up to October 31, 2022, or until further orders, sugar exports were permitted only with specific authorisation from the Directorate of Sugar, Department of Food and Public Distribution (DFPD). This notification clearly established sugar exports as ‘restricted’ but not ‘prohibited’, contingent on obtaining specific permission.

Precedents Supporting the Bombay High Court’s Stance

The Bombay High Court’s decision aligns with established principles and previous rulings:

• Shree Renuka Sugars Ltd. v. Union of India (SCA No. 2186 of 2023, April 13, 2023): This case affirmed that RoDTEP benefits cannot be denied solely due to procedural lapses, allowing exporters to claim benefits subsequently.
• M/s Satyendra Packaging Ltd. v. Union of India (Special Civil Application No. 3084 of 2023, November 29, 2023): The Gujarat High Court had previously ruled that exporters complying with export permissions and policy conditions are entitled to RoDTEP benefits, even for ‘restricted’ goods. This judgment directly supports the Rika Global Impex Limited decision.
• Maneklal Chunilal & Sons Ltd. v. CIT (AIR 1954 Bom 135): This case established the principle of uniformity in interpreting central statutes, guiding High Courts to follow precedents set by others unless there are strong reasons to deviate.