The Gujarat High Court has rejected the revenue department’s contention that sugar exports under quota were under restricted category and not eligible for benefits under the Remission of Duties and Taxes on Exported Products (RoDTEP) Scheme.
The high court order comes as a relief to sugar exporters. Revenue authorities had denied benefits under the scheme to a number of exporters and issued notices for the recovery of about $3 billion that had earlier been claimed.
The RoDTEP scheme is aimed at neutralising taxes and duties for exported goods. These benefits are not available to the export of items placed in the restricted category.
“The respondents are directed to grant the benefit of rebate under the RoDTEP scheme to the petitioners who have exported sugar with specific permission under the specific condition prescribed by the Directorate of Sugar,” a bench of Bhargav D Karia and Niral R Mehta ordered earlier this week.
Last year, the government had set the quota for sugar exports from June 1, 2022 at 6 million tonnes.
Subsequently, revenue authorities began denying benefits of the RoDTEP scheme to the exporters and seeking recovery of the benefits taken.
Exporters moved the court against this, arguing that sugar exports were allowed with “conditions” in terms of quantity and those could not be treated as a “restricted” category.
The revenue department argued that restricted categories were not eligible for export benefits as per rules.
“The remission of duties under the new scheme happens in the most pragmatic manner and the Indian government is already supporting the Indian exporters even at the international legal forums, hence, any executive action to deny the benefits to our exporters will have to cross the constitutional test,” said Abhishek Rastogi, founder of law firm Rastogi Chambers who had argued for the sugar exporters.