In order to promote exports, the government has already launched various measures to ease the procedural and taxation burden for the exporters. The tax burden is reduced to a great extent through exemptions and refunds granted to the exporters. One such popular scheme is the RODTEP scheme for exporters. Recently, the government has added a new para 4.94 under Chapter 4 of Handbook of Procedures 2023 that discusses details about the filing of Annual RODTEP Return (ARR). Let’s understand this in detail.

What is RODTEP Scheme?

RODTEP stands for the Remission of Duties and Taxes on Exported Products. It is a scheme launched by the government to promote exports by providing rebates on the central, state and local taxes paid by the exporters. The scheme came into effect from 1st January, 2021 and replaced the Merchandise Exports from India Scheme (MEIS). The RODTEP Scheme ensured that the exporters received the refund of embedded duties and taxes that were previously non-recoverable.

What is the Annual RODTEP Return (ARR)?

The exporters who are claiming the RODTEP benefits are required to file the Annual RODTEP Return (ARR) in the format given under Appendix-4RR of Handbook of Procedures, 2023. The return assists in assessing the nature of inputs used in the production of export goods and the actual amount of duties and taxes incurred.

Applicability and Due Date of Filing RODTEP Return

The Annual RODTEP Return for a particular financial year shall be filed by 31st March of the next financial year on the DGFT portal. For instance, the annual RODTEP return for the Financial Year 2023-24 shall be filed on the DGFT portal by 31st March 2025. The filing of RODTEP return shall begin with the exporters who’s total RODTEP claim exceeds Rs. 1 crore in a financial year across all 8-digit HSN codes.

Penal Provisions for Non-Filing of RODTEP Return

In case the exporter fails to file the annual RODTEP return, then the benefits under RODTEP scheme shall not be available and no further scroll out of RODTEP claims for the SBs will be allowed at the Customs Port of Export after the expiry of the grace period of 3 months i.e., 30th June.

For filing after 31st March but up to 30th June, a composition fees of Rs. 10,000 shall be paid for delayed filing of ARR. Therefore, for FY 2023-24, ARR can be filed even after 31/03/2025 but before 30/06/2025 by paying composition fees of Rs. 10,000. After 30th June, the composition fees of Rs. 20,000 shall be paid.

After the payment of composition fees, RODTEP scrolls shall resume within 45 days. Till then, an online API based message exchange is established between Customs and DGFT. Therefore, after the scroll out is resumed, it shall also cover the shipping bills that were not scrolled out earlier due to non-filing of ARR.

Important Points to Consider

Here are certain important points that you should remember in regards to the Annual RODTEP Return for exporters:

  • All the records, whether physical or digital, substantiating the duty remission claims shall be maintained for a period of 5 years and shall be available to be produced before the relevant authorities assessing the ARR.
  • The RODTEP filings can be periodically assessed for necessary due diligence. It can be produced before the RODTEP committee in order to make necessary revisions in rates, including consideration of the higher rates, wherever required.
  • Certain cases of ARR can be identified by the IT-assisted risk-based criteria. These cases can be taken up for further scrutiny to assess the nature of inputs that are actually used in the production of export goods as well as the duties and taxes paid thereon. After the concerned authority completes the assessment, the RODTEP scrip holder shall be responsible to surrender or refund any excess claims as passed in the order of scrutiny. Failure to do so will lead to the stoppage of further benefits under the RODTEP scheme.

For more such useful information, contact the ASC Group.

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