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1. The sample does not conform to standards prescribed in Basmati Rice (Export) Grading and Marketing Rules, 1979 (hereafter 'the Basmati Rules').

2. The sample conforms to the requirements of length and length/breadth ration as per the Notification dated 5 th November, 2008 of the Director General of Foreign Trade (DGFT).

5. Since there was some ambiguity in the above report, the Commissioner of Customs (CoC) wrote a letter dated 15th March, 2013 to the RALNew Delhi asking it to clarify, specifically in the light of the notification dated 5th November 2008, whether the product in question was Basmati (including Pusa Basmati 1121) or Non-Basmati Rice. In response to the above query the RAL, New Delhi sent a letter dated 16 th March, 2011 in which it confirmed that both samples were not conforming to the Basmati Rules as they contained 'other rice' in a proportion that exceeded 20% which was the maximum permitted under the said Rules. Secondly, the rice did not possess the natural fragrance in both raw and cooked stages. Hence, neither these sample could be considered as samples of Basmati Rice (RUD No.3). As the Respondent was permitted only to export Basmati Parboiled in terms of the certificate issued in its favour, and since export of non- Basmati Rice was prohibited under the Export Policy in terms of Notification No. 55 (RE-2008) 2004-2009, a show cause notice was issued to the Respondent on 26th May, 2011 by the CoC.

11. Learned counsel for the Respondent, on the other hand, submitted that the samples clearly conformed to the requirements of length and the length/breadth ratio in terms of the DGFT notification dated 05 th November, 2008. The requirement regarding percentage of other rice was later on introduced by the Department on its own and even the show cause notice did not call upon the Respondent to explain any discrepancy on that score. It was submitted that it was only the requirements of the above mentioned DGFT notification that were expected to be complied with. It was further submitted that the test reports did not clearly indicate whether the 'other rice' found present in the consignment was also another form of Basmati Rice itself. A reference was made to the reply received by the Respondent under the Right to Information Act (RTI Act) from the Bureau of Indian Standards that there was no Indian Standard or method to differentiate non-Basmati Rice from Basmati Rice. A reference was also made to the reply dated 22nd September, 2011 of the Ministry of Agriculture under the RTI Act to a query as to whether the Basmati Rice Rules were made to ascertain the quality or veracity of Basmati Rice stating that the said rules have been made to ascertain the 'quality of Basmati Rice.' The thrust of the submission was that the expression 'other rice' could include even other varieties of Basmati rice which may not be able to be determined in terms of the Basmati Rules and that unless the RAL report categorically stated that the other rice was not Basmati Rice, the Respondent could not be said to violate Section 113 (d) of the Customs Act.

12. First, it requires to be noted that the Order-in-Original dated 21st October, 2011 of the Additional Commissioner of Customs refers to the fact that the certificate issued to the Respondent for export mentions the commodity permitted to be exported as 'Basmati Parboiled 158248'. The second important fact is that under the Export Policy in terms of the DGFT notification dated 5th November 2008, export of non-Basmati Rice is prohibited. The third factor is that in terms of the policy circular dated 30th September, 2008 again issued by the DGFT the Customs Department was to allow the export of Basmati Rice and Pusa 1121 non-Basmati Rice based on the parameters of the grain length, and grain length to breadth ratio. This circular made it clear that "Customs may draw, redeem samples for testing to ascertain variety identification and send these samples for analysis to Agmark Analyst Centres". While the notification dated 16th September, 2008 did prescribe that the standard to be met as far as Basmati rice meant for export was concerned was that the grain should be 7 mm in length and ratio of length to breadth of the grain shape should be more than 3.6, (which was later amended vide notification dated 17th August, 2010 to read more than 6.61mm of length and a length to breadth ratio of more than 3.5), the fact is that under the DGFT Circular dated 30th September, 2008 the samples were also to be sent for testing to the Agmark Laboratories. Combined with the fact that the notification dated 5th November, 2008 prohibited the export of non-Basmati rice, this meant that the consignment had to also conform with the requirement of the Basmati Rice Rules. Schedule 2 to the Basmati Rice Rules specifies the maximum presence of other rice including red grain as 20%.

14. The contention of the Respondent that the words 'other rice' could mean other varieties of Basmati Rice is not borne out from the test reports in the present case. If the Respondent wanted to show that the other rice found present to the consignment was also Basmati Rice then the burden was on the Respondent to show that. As far as the Department is concerned, it was justified in proceeding on the strength of the test report that the presence of other rice, i.e. non-basmati rice, was more than the permissible maximum limit of 20%. Since the consignment was not entirely of Basmati Rice, it was not sufficient that the grains confirmed to the length and length/breath ratio prescribed for Basmati Rice in order to pass the test.