Gujarat HC orders arrest of SW South Wind I amid rice cargo dispute

The issue of irregularities in the export of non-basmati white rice, which was falsely labeled as organic rice, has taken a serious turn. Some exporters whose shipments have been affected are now seeking compensation through legal channels.

In a recent development, the Gujarat High Court has ordered the detention of the merchant vessel SW South Wind I at Deenadayal (Kandla) Port. This decision was made in response to a petition filed by Farmart Services Private Ltd., whose consignments of 2,000 tonnes of non-basmati parboiled rice were held up due to suspicions of white rice being exported as organic rice.

The suspicions of irregularities arose after a report revealed that some exporters were falsely labeling white rice as organic rice to bypass regulations. Following this report, the Department of Revenue Intelligence (DRI) detained the vessels SW South Wind I and MV Della.

Farmart Services Private Ltd. had entered into an agreement to export 2,000 tonnes of parboiled rice, but the vessel was detained due to “lack of clearance for the cargo”. The company’s counsel argued that their cargo met all export standards and that the detention was due to other prohibited cargo on board the vessel.

The court ordered the arrest of SW South Wind I until further orders, unless the vessel owners pay $1.44 million to Farmart. The DRI officials suspect that some exporters may have violated regulations by exporting white rice instead of organic rice and evading export duties.

Following these developments, the Agricultural and Processed Food Products Export Development Authority (APEDA) suspended Sikkim State Organic Certification Agency and Reliteaur Foods Private Limited from issuing organic certifications and exporting organic produce, respectively. Both entities have been fined ₹10 lakh each and face a one-year suspension.

The situation highlights the need for stricter oversight and regulation in the export of organic products to ensure compliance with international standards and prevent fraudulent practices.