INTRODUCTION
In this write-up, I am going to discuss the Import Export Code (hereinafter called IEC.) Import Export Code is the alphanumeric code similar to the PAN of the Company/Individual/Firm, as the case may be. It is used for the identifications of the importer and exporter.
Provisions regarding the IEC are provided under;
1. The Foreign Trade (Development and Regulation) Act, 1992,
2. Foreign Trade (Regulation) Rules, 1992, and
3. Foreign Trade Policy 2015-2020.
DEFINITION
The Foreign Trade (Development and Regulation) Act, 1992, defines import-export code in Section 2 clause (f). While in chapter III, Section 7 and Section 8 provides the provision regarding allotment and suspension of the IEC.
As per Section 2(f);
“Importer-exporter Code Number” means the Code Number granted under section 7.
So the code number granted under Section 7 is IEC. Now let us discuss section 7 in detail.
Section 7 “No person shall make any import or export except under an Importer-exporter Code Number granted by the Director General or the officer authorised by the Director General in this behalf, in accordance with the procedure specified in this behalf by the Director General:
Provided that in case of import or export of services or technology, the Importer-exporter Code Number shall be necessary only when the service or technology provider is taking benefits under the foreign trade policy or is dealing with specified services or specified technologies.”
It is important to note that since the provision specifically excludes service and technology so this section in generality applies to the import and export of all types of goods.
So any person wants to import or export any goods need to have IEC, and one cannot export or import without IEC.
In the case of services and technology, IEC will be required only when; the importer-exporter is taking advantage under Foreign Trade Policy or dealing with specified services or technologies.
SUSPENSION AND CANCELLATION OF IEC
Section 8 deals with the suspension and cancellation of IEC. Section charts out the reason for the suspension or cancellation of the IEC. The reasons for the suspension or cancellation of the IEC are;
1. Contravention under this Act or rule made thereunder,
2. Contravention under Foreign Trade Policy
3. Contravention under custom, central excise, Foreign exchange, or any other economic offence, for example, wilful defaulter.
4. If the Authorised office has reason to believe that import or export has been made in the manner prejudicial to the Interest of India or its relationship with other nations.
5. Import or export is done in a manner contravening the provisions of the Act.
However, before cancelling or suspending IEC reasonable opportunity of being heard must be given to the person. If the IEC is suspended or cancelled, such a person shall import or export only under a special license.
Section 8. Suspension and cancellation of Importer-exporter Code Number.
1(1) Where–
(a) any person has contravened any of the provisions of this Act or any rules or orders made thereunder or the foreign trade policy or any other law for the time being in force relating to Central excise or customs or foreign exchange or has committed any other economic offence under any other law for the time being in force as may be specified by the Central Government by notification in the Official Gazette; or
(b) the Director General or any other officer authorised by him has reason to believe that any person has made an export or import in a manner prejudicial to the trade relations of India with any foreign country or to the interests of other persons engaged in imports or exports or has brought disrepute to the credit or the goods of, or services or technology provided from, the country; or
(c) any person who imports or exports specified goods or services or technology, in contravention of any provision of this Act or any rules or orders made thereunder or the foreign trade policy,
the Director General or any other officer authorised by him may call for the record or any other information from that person and may, after giving to that person a notice in writing informing him of the grounds on which it is proposed to suspend or cancel the Importer-exporter Code Number and after giving him a reasonable opportunity of making a representation in writing within such reasonable time as may be specified in the notice and, if that person so desires, of being heard, suspend for a period, as may be specified in the order, or cancel the Importer-exporter Code Number granted to that person.]
(2) Where any Importer-exporter Code Number granted to a person has been suspended or cancelled under sub-section (1), that person shall not be entitled to 2 [import or export any goods or services or technology] except under a special licence, granted, in such manner and subject to such conditions as may be prescribed, by the Director General to that person.
THE FOREIGN TRADE (REGULATION) RULES, 1993
The Foreign Trade (Regulation) Rules, 1993, does not provide anything specific to the IEC, however, the definition of importer or exporter is important here. As per Rule 2 clause (c), an importer or exporter means a person that imports or export goods and holds a valid importer exporter code number granted under section 7 of the above mentioned act. ‘
importer” or “exporter” means a person who imports or exports goods and holds a valid Importer-exporter Code Number granted under section 7;
FOREIGN TRADE POLICY 2015-2020
The next and most important part of sub-legislation for IEC is Foreign Trade Policy, and currently, Foreign Trade Policy 2015-2020 is applicable.
Under Para 1 sub-para 3, the Director-General of Foreign Trade(DGFT) has the power to issue a handbook on procedures and Aayat Niryat Forms.
1..03 Hand Book of Procedures (HBP) and Appendices & Aayat Niryat Forms (AANF)
Director General of Foreign Trade (DGFT) may, by means of a Public Notice, notify Hand Book of Procedures, including Appendices and Aayat Niryat Forms or amendment thereto, if any, laying down the procedure to be followed by an exporter or importer or by any Licensing/Regional Authority or by any other authority for purposes of implementing provisions of FT (D&R) Act, the Rules and the Orders made there under and provisions of FTP.
Further, Para 1 Sub-Para 11 provides the following;
1. IEC is mandatory for the export or import in India
2. DGFT issue the IEC in electronic form.
3. Application for obtaining IEC code will be submitted online, and payment to be made through net banking, and application to be signed digitally (either through class III DSC or through e-sign through Aadhar)
4. IEC to be allotted or rejected with reason within 2 working days.
1.11 Issue of e-IEC (Electronic-Importer Exporter Code)
(a) Importer Exporter Code (IEC) is mandatory for export/import from/to India
as detailed in paragraph 2.05 of this Policy. DGFT issues Importer Exporter Code in electronic form (e-IEC). For issuance of e-IEC an application can be made on DGFT (http//:dgft.gov.in). Applicant can upload the documents and pay the requisite fee through Net banking. Applicant shall, however, submit the application duly signed digitally.
(b) Processing of such applications by Regional Authority (RAs) of DGFT would
1.09 Citizen’s Charter
DGFT has in place a Citizen’s Charter, giving time schedules for providing various services to clients. Time line for disposal of an Application is given in Para 9.10 of HBP.
1.10 Online Complaint Registration and Monitoring System
An EDI Help Desk is available to assist the exporters in filing online applications on the DGFT portal and resolving other EDI related issues. For assistance an email may be sent at dgftedi@nic.in or Toll Free number 1800111550 can be used. Help Desk facility is also operational at the 4 DGFT Zonal Offices (details at http://dgft.gov.in). An Online Complaint registration and monitoring system allows users to register complaint and receive status/ reply online (details are at http://dgft.gov.in).
1.11 Issue of e-IEC (Electronic-Importer Exporter Code)
(a) Importer Exporter Code (IEC) is mandatory for export/import from/to India
be done online and a digitally signed e- IEC would normally be issued/ e- mailed to the applicant within 2 working days.
(c) In case the application is incomplete or otherwise ineligible, the same shall be
rejected and a Rejection letter/email (with reasons for rejection) would be sent to the applicant.
(d) Application for issue of e-IEC can also be made from eBiz platform
(https://www.ebiz.gov.in).
Other details regarding IEC is provided under Para 2 sub-para 05.
1. IEC is a 10 digit alpha-numerical code.
2. IEC is equal to PAN and will be used separately by DGPf
3. No import or export without IEC, unless exempted
4. IEC needs to be updated every year, between the months of April to June.
5. IEC will be deactivated in case of failure to update the IEC during the above mentioned period.
6. Once updated, the IEC will be re-activated.
2.05 Importer-Exporter Code (IEC)/ (e-IEC)
(I) An IEC is a 10-character alpha-numeric number allotted to a person that is mandatory for undertaking any export/import activities. With a view to maintain the unique identity of an entity (firm/company/LLP etc.), consequent upon introduction / implementation of GST, IEC will be equal to PAN and will be separately issued by DGFT based on an application.
(a) No export or import shall be made by any person without obtaining an IEC number uness specifically exempted. For services exports, IEC shall be necessary as per the provisions in Chapter 3 only when teh service provider is taking benefits under the Foreign Trade Policy.
(b) Exempt categories and corresponding permanent IEC numbers are given in Para 2.07 of Handbook of Procedures.
(c) Application process for IEC and updation in IEC is completely online and IEC can be generated by the applicant as per the procedure detailed in the Handbook of Procedure.i
(d) An IEC holder has to ensure that details in its IEC is updated electronically every year, during April-June period. However, for the current year only, this period is extended by another month i.e. till 31st July, 2021. In cases where there are no changes in IEC details same also needs to be confirmed online.ii
(e) An IEC shall be de-activated, if it is not updated within the prescribed time. An IEC so de-activated may be activated, on its successful updation. This would however be without prejudice to any other action taken for violation of any other provisions of the FTP.iii
(f) An IEC may be also be flagged for scrutiny. IEC holder(s) are required to ensure that any risks flagged by the system is timely addressed; failing which the IEC shall be deactivated. iv
HOW TO APPLY FOR IEC
1. Visit the website dgft.gov.in
2. Before applying for IEC, one needs to create a Login ID.
3. Once login is activated, the applicant will enter details regarding the company, its registered office, branch office, Directors, bank details (at least one bank need to be selected as a primary bank) etc.
4. Documents such as Address Proof, Account Proof, etc., will be required.
Other Services the dgft.gov.in provides includes,
1. Linking of IEC, and
2. Updating of the IEC.
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