Coverage under QCO is not enough to make an item 'restricted' under FTP

Relaxation covers exports still within 15 months as of Nov 13, 2025; FTP rules clarify quality-control imports, re-exports and refunds

We refer to the RBI’s notification allowing extension in the time period for realisation and repatriation of full export value of goods/software/services exported from India from nine months to fifteen months from the date of export from India. I want to know the period for which this relaxation is applicable? 

In my view, the relaxation is applicable for all exports where the time limit of fifteen months has not passed as on November 13, 2025 and all future exports. 

We have imported certain goods that are freely importable under the FTP but covered under a quality control order. The suppliers are not registered with the Bureau of Indian Standards. After arrival but before Customs clearance of the goods, we have obtained an advance authorization for duty free import of the imported item. We have sought the dispensation under Para 2.12 of the FTP read with DGFT Policy Circular no. 02/2025-26 dated July 22, 2025. The Customs say that these provisions do not apply for restricted items and so they cannot clear the imported items under advance authorisations. Are they correct? 

No. The Customs are correct in saying that the said Para 2.12 or Circular 2/2025-26 exclude the dispensation to restricted items but they are wrong in saying that the goods you have imported are restricted under the FTP only because they are covered under a quality control order and  imported from a supplier not registered with the BIS. Para 11.48 of the FTP says that, ‘“restricted” is a term indicating the import or export policy of an item, which can be imported into the country or exported outside, only after obtaining an Authorisation from the offices of DGFT”. For import of your item, no authorisation is required from the DGFT. So, the Customs cannot treat the item as ‘restricted’ and refuse the dispensation under Para 2.12 of the FTP read with the said Circular 2/2025-26. 

We had exported certain items that our customer found defective. So, we re-imported the items for repairs and re-export under notification 158/95-Cus dated November 14, 1995. Now, our customer says that he does not want the material due to some changed circumstances at his end. Can we re-export the item to some other customer? 

Yes. The said notification no. 158/95-Cus only says that ‘the goods are re-exported within six months of the date of re-importation or such extended period not exceeding a further period of six months as the Commissioner of Customs may allow’. So, there is no condition that the goods must be re-exported to the same customer from whom you re-imported the goods. 

We had received 100 per cent advance payment against an export order but now the Customer says that he does not want the goods? Can we send back the advance received? 

Yes, if you are sending back the money within one year of receipt of the inward remittance. If more than one year has passed, you will have to seek the permission of RBI.

 

Email: tncrajagopalan@gmail.com