Delhi HC: Chilli Exporters Eligible for TMA Rewards Amid DGFT Dispute

The Delhi High Court decided on December 10, 2025, that chilli exporters can receive rewards for exports made between September 9, 2021, and March 24, 2022. This decision follows a legal dispute with the Directorate General of Foreign Trade (DGFT) over taking back a helpful program.

Background of the Case

The Chillies Exporters Association India filed a case against an order by the Directorate General of Foreign Trade dated March 19, 2024. This order denied their request to benefit from the "Revised Transport and Marketing Assistance (TMA) for Specified Agricultural Products" program, which was ended by a notice dated March 25, 2022.

The TMA Scheme Timeline

• February 27, 2019: The TMA Scheme was started to help agricultural exports.
• March 17, 2020: The program was extended until March 31, 2021.
• September 9, 2021: A revised program was announced, covering exports from April 1, 2021, to March 31, 2022.
• March 25, 2022: The program was ended, causing disputes over its retrospective application.

Legal Arguments

For the Chillies Exporters Association India:

• The Chillies Exporters Association India argued that the program's benefits, promised for exports made until March 31, 2022, were unfairly taken away.
• They referred to the Supreme Court's decision in Kanak Exports, arguing that the government cannot change policies after the fact unless clearly allowed by law.

For the Directorate General of Foreign Trade:

• The Directorate General of Foreign Trade defended ending the program, claiming it aimed to improve the program for better results.
• They argued that economic policy decisions should not be easily changed by courts unless there is evidence of bad intent or unfairness.

Court's Decision

Judges Involved: Chief Justice Devendra Kumar Upadhyaya and Justice Tushar Rao Gedela.

The court decided that:

• The government does not have the power to issue notifications that apply to past actions under the Foreign Trade (Development and Regulation) Act, 1992.
• Exporters who shipped chillies between September 9, 2021, and March 24, 2022, can receive rewards as per the original program.

"The notification dated 09.09.2021 shall operate prospectively and therefore, if any exporter is found to have exported the chillies on and after 09.09.2021 till 24.03.2022, such an exporter shall be eligible to claim incentive under the TMA Scheme for this period alone, if he is otherwise entitled and eligible for claiming incentive."

Summary of the Verdict

The court partially agreed with the petition, ordering the Directorate General of Foreign Trade to handle claims for eligible exporters. This decision shows the court's role in ensuring fair treatment in policy changes that affect economic interests.