The IEC means the code for importing exports. Any importer and exporter is to obtain IEC code to begin importing from India, as per the Foreign Trade Policy (FTP) in India. No importer or exporter is allowed to do an import or export business without the IEC code.
What is the Import Export Code (IEC)?
An Importer Exporter Code (IEC) is from India. No export or import shall be carried out by any individual without an IEC code being received. For exports of services, however, the IEC is not required unless the service provider enjoys benefits under the Foreign Trade Policy. For importing or exporting goods or services, a person or a business organization requires a 10-digit code. This code is classified as the Import Export Code issued by the Department of Trade and Industries, Govt. of India
Procedure for securing an Import Export Code
- The ‘Import Export Code’ is a ten-digit number issued by the Director General of International Trade, most generally referred to as the IEC. The ‘Import Export Code’ is the required provision for all persons interested in the import or export from India of goods or services.
- In the case of nut-shell, it is important to acquire an IEC that is able to extend its product or service from the local market to the international market. Furthermore, in order to benefit from the DGFT, the Customs and Export Promotion Council’s export program, the IEC is compulsory.
- As shown above, IEC is a mandatory requirement for any kind of import/export from India, but IEC is not mandatory under subsequent import/export- code
- Import/export for personal consumption of products. The import/export of such goods is not related to commerce, output or agriculture.
- Government ministries, agencies and notified voluntary organisations import/export.
- Promoters/Individuals/Company/ Manager Two Color Photos
- Each Shareholder and Directors’ PAN Card
- Proof of Identification (Voter ID / Driving License/ Passport)
- (Bank Statement/Electricity, Mobile, Telecom Bill) Address Evidence
- Proof of a Registered Office
- As proof, the Utility Bill must be the latest
Why is the IEC Required?
- If any import/export operations are planned by organisations or companies, it is mandatory. Organizations or businesses can not carry out any import/export operations without the IEC.
- Organizations or businesses may take advantage of various incentives and/or discounts on their import exports from the DGFT, Customs, and Export Promotion Board.
- It is then necessary for the customs authority or customs port to clear or forward its shipments from the customs.
- An importer plans to transfer money through his banks outside India and then the bank needs it.
- An exporter collects money directly into his bank account in a foreign currency, then the bank needs it.
IEC Registration Procedure:
You would need to do the following basic IEC registration process in order to get your Import Export License online.
- Step 1: An online IEC application form is submitted to the Directorate-General for International Trade in the Aayaat Niryaat Form No. 2A format. It may also, instead, be done offline at the DGFT Regional Office
- Stage 2: All relevant records have to be submitted, including bank information and DSC.
- Stage 3: The Import Export Code will be allocated next and the application will be further processed.
- Stage 4: After the documentation and the application have been checked by the authority, a soft copy of the import export license will be released.
Eligibility for IEC Code:
- Importer Exporter Goods should be registered under every form of company registration: sole proprietorship, association, private limited and charitable entity concerned with export and import of goods.
- Any form of company registration: sole proprietorship, corporation, private limited corporations, charitable organizations concerned with the importation and exportation of products may, irrespective of their size, be registered under the import-export code. However, for the importation/export of goods for personal use that are not related to commerce, production or agriculture, the IE code is not necessary. For a company set up, there is no need.
- Import/export for personal consumption of products.
- Import/Export by the government and the notified charities.
- Technology and facilities are not covered if the equipment is not included on the limited list.
IEC for individual who are registered under GST
- If you are registered with GST, as per the Trade Circular, then the GSTIN number can be used for import and export purposes in India. However, the department decided that PAN should be used as an IEC number and not the GSTIN number to ensure uniformity. For new applications, the document will also be submitted to the DGFT department and the IEC number will be issued by the department as the PAN number only.
- In addition, the department is making necessary adjustments to the system by the new IEC holder so that the PAN number can be recognised as the IEC code.
IEC Code for persons who are not enrolled under the GST
The PAN number shall serve as an IEC code for individuals who are not expected. Furthermore, the application shall be forwarded to DGFT for all new applicants who are not expected to register under GST, and the PAN of the applicant shall be approved as an IEC.
Advantages of IEC for Businesses
PAN based registration
The code is issued on the basis of the company organisation’s Permanent Account Number. Therefore, registration is not necessary on the basis of a place of business, but only one registration may be required for a particular business organization. The license is either suspended or surrendered when and when the company is disbanded.
Validity for life time
IEC registration is a permanent, lifelong registration that is valid. There will also be no issues with the IEC registry being revised, filed and renewed. It is effective until the corporation remains or there is no revocation or surrender of the registration.
Registering for the Import Export Code will help you expand your business and reach out on a global scale to a larger market, helping your company to grow by leaps and bounds.
Limits the selling in illegal goods
Without supplying complete authentic material, IEC registration cannot be provided by the department, which as a consequence, limits the illicit trafficking in goods.
IEC Registration provides certain benefits
Import Export Code Registration gives some advantages In addition, businesses can also demand repayment of taxes charged when the goods are exported.
No return filing for Import Export Code
Registration ensures that you do not need to register any returns. You would not be forced to follow any kind of procedure to ensure that its validity is maintained until you are assigned a code. Even for export sales, you would not be allowed to file returns with the Director General of Foreign Trade.
Our Taxxinn experts will help you choose the right IEC license for your business and guide you in the IEC registration process. Contact now.