With the increase in international transactions, the world is getting smaller. In India, Import Export Code registration is necessary to execute international transactions. Quite a bit of confusion prevails about the applicability of Import and Export Code – Are there any post-registration compliance, how is an IEC number is allotted, etc. Now with GST being introduced, there is more confusion. Given below are some clarifications:
Is there a separate code for Import and Export?
The same IEC can be used for import and export both. Quite a lot of people have the wrong idea that separate IEC codes are required for Import and export, but this is not so. There is only one registration for import and export and the same IEC number can be used while importing as well as exporting. Moreover, there are plenty of advantages of having Importer – Exporter Code for businesses
Is IEC is only required for goods?
It is assumed that IEC is only for import or export of goods. But it is necessary for both goods as well as services. Import or export of services is an international transaction. So any person providing services beyond the boundaries of India has to make online IEC application.
Are there any renewal and returns in IEC?
As per recent changes made by DGFT via notification no. 58/2015-2020 dated 12th February,2021 all IEC holders are required to renew/update their registration every year electronically on or before 30th June of the year. If renewal is not done within the stipulated time than an IEC will be de-activated.
How is the registration number allotted for IEC number?
Previously, the IEC department would issue a separate number for IEC code. Recently the Ministry initiated revisions due to which the PAN of an applicant will be the registration number of IEC. Hence the PAN and IEC number will be the same. The Ministry will register the applicant under IEC and issue the approval letter immediately notifying PAN as their IEC number.
Is IEC is required for import or export of goods for personal use?
IEC is mandatory only for business and commercial purpose. There is no need for IEC to import or export goods for personal use. Hence one can import or export goods without any registration for personal use.
Do we need to take different IEC number for each firm?
Not every firm has to apply for IEC. But IEC is associated with PAN. Hence, if a person has more than one proprietorship firm then for every firm only one IEC registration is to be taken. This is because proprietorship firm does not have a separate identity and so the PAN of an individual is used as PAN of their proprietorship firm. If one has allotted more than one IEC for one PAN then one has to surrender with the Ministry for cancellation. A partnership firm or LLP or Company will need to quote their own PAN, as a separate PAN is allotted to them.
Are Government departments required to have IEC?
The State government or Central government departments are not required to take IEC registration. They are allotted a fixed number which is quoted for any such transactions.
Whether IEC is required if you have GST?
Every person who imports or exports has to take IEC registration. It is mandatory to register a PAN with DGFT department if the business involves imports or exports even you have registered under GST.
IEC norms are very simple, don’t get affected rumours. Just focus on building your business internationally. But don’t forget to register under IEC and other registrations as applicable, to carry on business without any hassles.