In a new twist to the organic rice export irregularities case, the Commissioner of Customs, Kandla, has asked the Deenadayal (Kandla) port authorities to release one of the two merchant vessels MV Della it had detained on August 5.
In a letter to the Traffic Manager of the Port — available with businessline — the Commissioner said the other vessel SW South Wind I could be allowed to set sail after getting a release order from the Gujarat High Court.
Both ships were detained on August 5, 2024, by authorities of the Department of Revenue Intelligence (DRI) following a businessline report on irregularities in the export of organic rice as some exporters allegedly shipped out white rice in the garb of organic rice.
‘Arrest’ order
Last week, the Gujarat High Court ordered the “arrest” of SW South Wind I after two exporting firms — MEIR Commodities India and Farmart Service Pvt Ltd — moved it seeking compensation of $1.8 million totally. They had argued that their consignments had been detained for some other fault.
The Customs Commissioner told the port traffic manager that the additional commissioner (adjudication) of Kandla adjudicated the case and the default firms — Reliteaur Foods Pvt. Ltd. and Elite Agro Specialities — had paid the due amount of fine and penalty.
The order comes on the heels of the Gujarat High Court order. It was set to resume hearing in MEIR Commodities claim on Thursday, while hearing in Farmart’s case will be heard on October 24.
On October 1, Reliteaur Foods was suspended from exporting organic rice for a year and fined ₹10 lakh by Agricultural and Processed Food Products Export Development Authority (Apeda). The authority imposed a similar suspension and penalty on Sikkim State Organic Certification Agency.
Customs criticised
Experts and trade analysts, however, criticise the Customs authorities action. “The defaulting firms’ cargoes should have been offloaded and then made to go through Customs formalities before being allowed to sail,” said an expert, who did not wish to be identified.
“The defaulting firms had claimed the cargoes to be organic. Technically, they should have been offloaded and Customs authorities should have taken possession of it,” said a trade analyst, suspecting that the development was “more than what meets the eye”.
Both wondered if Apeda or Commerce Ministry had been informed of the decision, since it falls under their purview.
According to data accessed by businessline, organic rice exports in the first four months of the fiscal year exceeded the total shipments in the entire 2023-34 fiscal. Data showed that some of the organic consignments did not reach their destination. Also, some of the buying nations, particularly in Africa, cannot afford to buy organic rice, which commands a premium.
They also revealed that 22,126 tonnes and 16,547 tonnes of organic rice shipments set sail for Vietnam and Kenya, respectively. But, hardly 2,000 tonnes reached their destinations.
