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04 Nov 2025

Annual RODTEP Return (ARR): New Compliance Requirement under Para 4.94 of Handbook of Procedures, 2023

Annual RODTEP Return (ARR): New Compliance Requirement under Para 4.94 of Handbook of Procedures, 2023

Annual RODTEP Return (ARR): New Compliance Requirement under Para 4.94 of Handbook of Procedures, 2023

1. Introduction

To strengthen India’s export competitiveness, the Government of India has introduced various policy initiatives to ease procedural and taxation burdens on exporters. Among such measures, the Remission of Duties and Taxes on Exported Products (RODTEP) scheme stands out as a key reform in ensuring that Indian exports are free from the burden of embedded taxes and duties that were earlier non-recoverable.

In a significant move towards greater accountability and data-based assessment of remission claims, the Directorate General of Foreign Trade (DGFT), through Public Notice No. 27/2024-25 dated 23 October 2024, has inserted a new paragraph 4.94 in Chapter 4 of the Handbook of Procedures, 2023 (HBP 2023). This new provision mandates the filing of an Annual RODTEP Return (ARR) by exporters availing RODTEP benefits.

2. Overview of the RODTEP Scheme

2.1 Objective

RODTEP aims to refund the embedded duties, taxes, and levies incurred at the Central, State, and local levels that are not otherwise refundable under any other mechanism. The scheme replaces the Merchandise Exports from India Scheme (MEIS), aligning India’s export incentives with global trade obligations and WTO norms.

2.2 Effective Date

The scheme came into effect on 1st January 2021 and applies to goods exported from India under notified tariff lines.

2.3 Nature of Benefit

Under RODTEP:

  • The exporter receives a refund of eligible taxes and duties as electronic transferable duty credit scrips (e-scrips).

  • The benefit is computed as a percentage of the Free on Board (FOB) value of exports, as per rates notified by the DGFT for each 8-digit HS code.

  • It ensures that Indian goods are not disadvantaged in international markets due to hidden domestic tax costs.

3. Annual RODTEP Return (ARR) – Concept and Purpose

The newly inserted Paragraph 4.94 of Chapter 4 of the Handbook of Procedures, 2023 introduces the concept of the Annual RODTEP Return (ARR). Exporters claiming benefits under the RODTEP scheme are now required to submit an annual return in the prescribed format, Appendix 4RR, through the DGFT portal.

3.1 Purpose of ARR

The primary objectives of the ARR are:

  • To enable the DGFT to assess the nature of inputs and actual taxes/duties embedded in export goods.

  • To validate the accuracy and reasonableness of remission claims.

  • To support periodic review and rationalization of RODTEP rates by the authorities based on verified data.

4. Applicability and Due Dates

4.1 Applicability Threshold

The requirement to file an ARR applies to exporters whose aggregate RODTEP claim in a financial year exceeds ?1 crore, computed across all 8-digit HS codes.

4.2 Due Date

The Annual RODTEP Return must be filed on the DGFT portal by 31st March of the succeeding financial year.
For example, for FY 2023–24, the ARR must be filed by 31st March 2025.

4.3 Grace Period and Composition Fees

  • If the ARR is filed after 31st March but on or before 30th June, a composition fee of ?10,000 is payable.

  • If filed after 30th June, the composition fee increases to ?20,000.

  • Failure to file within the permissible period results in suspension of RODTEP scroll generation for all pending shipping bills at the Customs port until compliance is made.

Once the ARR is filed and composition fee paid, RODTEP scrolls resume within 45 days and cover all pending shipping bills that were withheld due to non-filing.

5. Format and Contents of ARR (Appendix 4RR)

The Annual RODTEP Return (ARR) is required to be furnished in the format prescribed under Appendix 4RR of the Handbook of Procedures, 2023. It contains detailed disclosures on input-wise and tax-wise data relating to exported goods.

5.1 Details to be Furnished

The exporter is required to report the following particulars:

  • Exporter details (IEC, PAN, address, and contact information).

  • Description of exported goods along with 8-digit HS Code, quantity, and FOB value.

  • Taxes and duties paid on inputs, consumables, fuel, electricity, and packing materials used in the manufacture of exported products.

  • Duties or levies paid on transportation (inbound and outbound) of goods.

  • Stamp duties and electricity duties borne by the exporter.

  • Any other embedded taxes or local levies incurred.

  • Comparative analysis of total tax incidence vis-à-vis RODTEP benefit claimed.

  • Declaration regarding exemptions, rebates, or concessions availed during the year.

5.2 Filing in Case of Multiple HS Codes

  • Where total RODTEP claims exceed ?1 crore, but no single HS code claim exceeds ?50 lakh, only one consolidated ARR needs to be filed for the HS code with the highest claim value.

  • However, if multiple HS codes each exceed ?50 lakh, a separate ARR must be filed for each such HS code.

6. Penal Consequences for Non-Compliance

Non-filing of the ARR within the prescribed timelines results in:

  • Suspension of further RODTEP benefits and restriction of scroll generation at Customs ports.

  • Requirement to pay the applicable composition fees before the resumption of benefits.

  • Possible selection of the exporter for risk-based scrutiny or audit of claims by the DGFT or Customs authorities.

7. Record-Keeping and Assessment

  • Exporters are mandated to maintain supporting records (physical or digital) substantiating the remission claims for a period of five years from the date of filing.

  • The DGFT may select cases for IT-based risk assessment to verify the accuracy of claims and determine the actual incidence of taxes and duties.

  • If an exporter is found to have claimed excess remission, the concerned RODTEP scrip holder shall be required to refund or surrender such excess amount.

  • Continued failure to comply with such directions will lead to disqualification from future benefits under the RODTEP Scheme.

8. Legal Provisions and References

  • Foreign Trade Policy, 2023 – Chapter 4: Duty Exemption/Remission Schemes.

  • Handbook of Procedures, 2023 – Para 4.94 (inserted vide Public Notice No. 27/2024-25 dated 23 October 2024).

  • Appendix 4RR – Format of Annual RODTEP Return (ARR).

  • Public Notice No. 51/2024-25 dated 19 March 2025 – Extended due date for filing ARR for FY 2023–24.

9. Practical Considerations for Exporters

  • Establish internal mechanisms to track RODTEP claims HS code-wise throughout the financial year.

  • Integrate ARR data requirements with accounting systems to capture input tax incidence at every stage.

  • Conduct internal reviews before filing the ARR to ensure correctness and prevent future recovery actions.

  • Ensure timely filing to avoid financial penalties and interruptions in RODTEP scroll generation.

  • Maintain close coordination between finance, logistics, and export documentation teams for accuracy in data compilation.

10. Conclusion

The introduction of the Annual RODTEP Return (ARR) marks a pivotal shift in India’s export remission landscape — moving towards data-backed verification and accountability. While the scheme continues to provide vital relief to exporters, compliance requirements have become more stringent. Exporters must now adopt a structured and proactive compliance framework, integrating ARR filing into their annual export documentation and audit processes.

Timely filing, robust record-keeping, and accurate reporting will not only ensure uninterrupted benefits under the RODTEP Scheme but also build credibility and resilience in an increasingly regulated export environment.

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Disclaimer: Every effort has been made to avoid errors or omissions in this material in spite of this, errors may creep in. Any mistake, error or discrepancy noted may be brought to our notice which shall be taken care of in the next edition In no event the author shall be liable for any direct indirect, special or incidental damage resulting from or arising out of or in connection with the use of this information Many sources have been considered including Newspapers, Journals, Bare Acts, Case Materials , Charted Secretary, Research Papers etc

Mayank Garg

LegalMantra.net Team