Export eligibility for basmati rice follows express foreign trade conditions, not FSSAI standards absent a specific mandate.

Export of de-husked brown basmati rice was to be tested against the conditions expressly prescribed in the Foreign Trade Policy and ITC (HS) Schedule-II, including APEDA registration and specified grain parameters, and those conditions were found satisfied. The Food Safety and Standards Act, 2006 was noted to regulate manufacture, processing, distribution, sale and import of food, but no provision, notification or circular was shown to extend FSSAI standards to the export of the goods. In the absence of a specific export requirement, reliance on FSSAI parameters and the CRCL report was insufficient to sustain a finding of misdeclaration, making confiscation, duty demand, redemption fine and penalties unsustainable.

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Issues: Whether export of de-husked brown basmati rice had to satisfy the Food Safety and Standards Authority of India standards, or only the conditions prescribed in the Foreign Trade Policy and ITC (HS) Schedule-II, and whether the consequential confiscation, duty demand, redemption fine and penalties were sustainable.

Analysis: The relevant export entry for brown basmati rice required registration with APEDA, compliance with the prescribed grain length and length-breadth ratio, export through permitted channels, and the other stipulated conditions. Those conditions were found to have been met. The Food Safety and Standards Act, 2006 was examined in the context of its scheme, including the functions of the authority and the definitions of food business and food business operator, and it was noted that the statute was framed to regulate manufacture, processing, distribution, sale and import of food, while export was not specifically addressed. No statutory provision, notification or circular was shown to extend FSSAI standards to the export of the impugned goods. In the absence of a specific export requirement under the Foreign Trade Policy, the mere reliance on FSSAI parameters and the CRCL report was held insufficient to establish misdeclaration or liability for confiscation.

Conclusion: The export was not required to satisfy the FSSAI standards in the manner asserted by the revenue, and the findings of misdeclaration, confiscation, duty demand, redemption fine and penalties were unsustainable.

Final Conclusion: The impugned order was set aside and the appeal succeeded with consequential relief.

Ratio Decidendi: In the absence of a specific statutory or policy mandate making domestic food standards applicable to exports, export eligibility is to be tested by the conditions expressly prescribed in the foreign trade policy and the relevant export schedule.

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