Fine for Misdeclaring Organic Rice Exports

The Indian Customs Department has fined two exporters $90,000 for attempting to misdeclare non-basmati white rice as organic rice. Reliteaur Foods Private and Elite Agro Specialities violated export regulations by falsely labeling non-basmati rice as organic. This fine follows an investigation that revealed discrepancies in the export process.

Additionally, the Commissioner of Customs (Appeals) imposed further penalties of $114,000 on Reliteaur Foods and $78,000 on Elite Agro Specialities. If they do not pay, Customs will confiscate their cargoes, total of 25,500 tonnes and 16,700 tonnes of rice.

Misdeclared Rice Exports - Detained Shipments

Customs detained shipments from both exporters aboard the vessels Della and SW South Wind-I. Officials suspected that the rice, banned for export from July 2023 to September 2024, was falsely labeled as organic. They valued the seized goods at $20 million.

The detention occurred after Customs raised concerns about the authenticity of the organic certification provided by the exporters. The shipments had been cleared based on provisional transaction certificates from the Sikkim State Organic Certification Agency (SSOCA), authorized by APEDA.

The Role of APEDA in Certification and Revocation

Initially, Customs allowed the shipments to proceed because of the provisional certificates issued by SSOCA. However, APEDA later revoked the organic certification in September 2024. This revocation sparked questions about the provisional certificates’ reliability and the process for certifying organic goods.

APEDA did not inform Customs promptly about the revocation, which led to confusion over the shipments' status. While the provisional certificates were valid at the time of shipping, APEDA’s investigation confirmed that the rice was conventional, not organic.

The delay in APEDA's communication has raised concerns about the transparency and effectiveness of the certification system. Critics argue that authorities should not treat provisional certificates as final guarantees of organic status.

Industry Concerns and Economic Impact

Industry experts have expressed concern over APEDA’s role in this case. Many questioned why the consignments were allowed to reclassify from organic to conventional rice after they had been shipped. They also criticized the lack of transparency in APEDA’s investigation process.

Some experts see the misdeclaration as economic fraud, potentially undermining India’s rice export market. They have called for more stringent regulations to prevent similar issues from recurring in the future.

Conclusion: Strengthening Export Integrity and Regulations

The $90,000 fine against Reliteaur Foods and Elite Agro Specialities highlights the need for stricter regulations in the rice export industry. While the penalties serve as a warning to exporters misdeclaring organic products, the case has raised critical questions about APEDA’s role and the effectiveness of provisional certification. Experts argue for tighter scrutiny of export shipments and better enforcement of organic certification.





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