RoDTEP and RoSCTL Incentives on Short Realisation: Detailed CBIC Clarification
The Central Board of Indirect Taxes and Customs (CBIC) has issued Circular No. 20/2026-Customs dated 10th April, 2026 providing important guidance on how to handle remission and rebate under the RoDTEP and RoSCTL schemes when export proceeds are not fully realised.
This circular brings the treatment of RoDTEP and RoSCTL benefits broadly in line with the established principles for duty drawback, particularly in situations where:
- Agency commission and foreign bank charges are deducted from export proceeds, and
- Exporters receive compensation from Export Credit Guarantee Corporation (ECGC) due to partial or non-realisation of sale proceeds.
The clarification is particularly relevant for exporters, authorised dealers, and customs officers dealing with exports where the full Free on Board (FOB) value is not realised in foreign exchange.
Background and Context
Representations were made by various trade bodies and exporters seeking clarity on two key aspects:
Whether, similar to duty drawback, full RoDTEP and RoSCTL benefits could be computed on the entire FOB value of exports without deducting:
- Agency commission, and
- Foreign banking charges.
How to treat ECGC compensation in situations where export proceeds are short-realised and whether such compensation would be considered as realisation of sale proceeds for the purposes of retaining RoDTEP and RoSCTL benefits.
After examining the matter in consultation with DGFT and the Ministry of Textiles, CBIC has aligned the approach for RoDTEP and RoSCTL with existing practice under the duty drawback scheme.
Reference to Earlier Board Circulars
Duty Drawback Position on FOB Value
CBIC has referred to the following earlier circulars dealing with duty drawback:
- Circular No. 64/2003-Cus dated 21.07.2003, and
- Circular No. 33/2019-Customs dated 19.9.2019.
Under these circulars, it has already been clarified that:
- Duty drawback is to be computed on the entire FOB value of the export invoice,
- Agency commission and foreign bank charges need not be deducted from the FOB value,
- This relaxation is permitted only where the total of such deductions does not exceed 12.5% of the FOB value, and
- If these deductions exceed 12.5%, the excess portion must be deducted from the FOB value before calculating duty drawback.
Extension of Similar Treatment to RoDTEP and RoSCTL
Full FOB-Based Benefits with 12.5% Cap
CBIC has now clarified that the same methodology applied in duty drawback cases will also apply for determination of benefits under RoDTEP and RoSCTL:
- RoDTEP and RoSCTL benefits may be granted on the full FOB value of the export invoice,
- There is no requirement to reduce:
- Agency commission, and
- Foreign bank charges,
from the FOB value for the purpose of computing RoDTEP/RoSCTL,
- This is subject to an overall ceiling of 12.5% of the FOB value for such deductions.