Import License and IEC Code Number
While the majority of the goods are freely importable, the Exim Policy (2007) of India prohibits import of certain categories of products as well as conditional import of certain items. In such a situation it becomes important for the importer to have an import license issued by the issuing authorities of the Government of India.
1. Import License Issuing Authority
2. Validity of Import License
3. Sample of Import License
4. Category of Importer
5. Custom Inspection
6. Registration for Importers
1. Import License Issuing Authority
In India, Import License is issued by the Director General of Foreign Trade. DGFT Delhi office is situated in Udyog Bhawan, New Delhi 110011.
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2. Validity of Import License
Import Licenses are valid for 24 months for capital goods and 18 months for raw materials components, consumable and spares, with the license term renewable.
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3. Sample of Import License
A typical sample of import license consists of two copies-
Foreign Exchange Control Copy
To be utilised for effecting remittance to foreign seller or for opening letter of credit
Customs Copy
To be utilised for presenting to Customs authority enabling them to clear the goods. In the absence of custom copy, import will be declared as an unauthorised import, liable for confiscation and or penalty.
Categories of Import
All types of imported goods come under the following four categories:
• Freely importable items: Most capital goods fall into this category. Any product declared as Freely Importable Item does not require import licenses.
• Licensed Imports: There are number of goods, which can only be importer under an import license. This category includes several broad product groups that are classified as consumer goods; precious and semi-precious stones; products related to safety and security; seeds, plants and animals; some insecticides, pharmaceuticals and chemicals; some electronically items; several items reserved for production by the small-scale sector; and 17 miscellaneous or special-category items.
• Canalised Items: There are certain canalised items that can only be importer in India through specified channels or government agencies. These include petroleum products (to be imported only by the Indian Oil Corporation); nitrogenous phosphatic, potassic and complex chemical fertilizers (by the Minerals and Metals Trading Corporation) vitamin - A drugs (by the State Trading Corporation); oils and seeds (by the State Trading Corporation and Hindustan Vegetable Oils); and cereals (by the Food Corporation of India).
• Prohibited items: Only four items-tallow fat, animal rennet, wild animals and unprocessed ivory-are completely banned from importation.
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4. Category of Importer
On the basis of product to be imported and its target buyer, importers categories are divided into three groups for the purpose of obtaining import licensing:
1. Actual Users- An actual user applies for and receives a license to import of any item for personal use rather than for business or trade purpose.
2. Registered exporters: defined as those who have a valid registration certificate issued by an export promotion council, commodity board or other registered authority designated by the Government for purposes of export-promotion.
3. Others.
The two types of actual user license are:
1. General Licenses : This license can be used for the imports of goods from all countries, except those countries from which imports are prohibited;
2. Specific Licenses: This license can only be used for imports from a specific country.
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5. Custom Inspection
Any violation in the import license is usually scanned by the custom officials of the custom department. Customer inspector and other custom officials have authority to inspect and evaluate the goods to be imported. It’s a part of their job to determine whether imports conform to the description in the import License or not. Custom official even have right to charge fines and penalties if any violation in the import license is found to be done by the importer.
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6. Registration for Importers
Registration of importer is a pre-requisite for import of goods. The Customs will not allow clearance of goods unless the importer has obtained IEC Number from issuing authority. In India, IEC number or Importers Exporters Code is issued by the DGFT.
However, no such import business registration is necessary for persons importing goods from Nepal or Myamar through Indo-Myanmar border or from china, through Gunji, Namgaya, shipkila or Nathula ports provided that the Value of a single Consignment does not exceed Rs. 25000/-.
a. Application for IEC Number
b. Process of Online Application
c. Guidelines for filling up IEC Form
d. Duplicate Copy of IEC No
e. Surrender of IEC No
a. Application for IEC Number
An application for grant of IEC Code Number should be made in the prescribed Performa given at Appendix 3.I. The application duly signed by the applicant should be supported by the following documents:
1. Bank Receipt (in duplicate) / Indian demand draft for payment of the fee of Rs.1000/- Certificate from the Banker of the applicant firm as per Annexure 1 to the form.
2. Two copies of passport size photographs of the applicant duly attested by the banker of the applicant.
3. A copy of Permanent Account Number issued by Income Tax Authorities, if PAN has not been allotted, a copy of the letter of legal authority may be furnished.
4. Declaration by the applicant that the proprietors/partners/directors of the applicant firm/company, as the case may be, are not associated as proprietor/partners/directors with any other firm/company the IEC No. is allotted with a condition that be can export only with the prior approval of the RBI India.
b. Process of Online Application
On-line form has been designed to ensure feeding of all the required information by prompting user wherever a field is left blank. Application has to submit scanned copies of PAN (Permanent Account Number) and bank certificate of deposits along with their application.
There are 2 options for payment of fee.
1. Demand Draft: If fee is paid by Demand Draft, IEC will be generated only after receipt of the physical copy of the application.
2. Electronic Fund Transfer: If IEC application fee is paid through Electronic Fund Transfer facility, IEC number will be generated by the licensing office automatically and the number can be viewed online by the applicant.
c. Guidelines for filling up IEC Form
1. All applications must be made in the prescribed form in duplicate, duly accompanied by Bank Receipt/ Demand Draft evidencing payment of fee.
2. Application form should be submitted in neatly typed bold letters. Handwritten forms are also accepted.
3. Each page of the document must have the signature of the authorised person with an ink pen.
4. Supporting documents in duplicate, duly self attested as specified earlier in this chapter must be enclosed wherever applicable.
5. Items of information relevant to applicant should only be filled in and remaining items may be marked 'Not Applicable'.
6. Two copies of the passport size photograph of the applicant duly attested by the applicant's banker shall be submitted.
7. Modifications of particulars of the applicant should also be furnished on this form by filling the relevant items.
d. Duplicate Copy of IEC No
Duplicate copy of IEC Number is issued to those importer (or exporter) who has lost their original IEC number. Importers are required to submit an affidavit and a fee of Rs.200 to obtain a duplicate copy of IEC Number.
e. Surrender of IEC No
Any importer who doesn’t want to continue his import business may surrender the IEC number to the issuing authority. On receipt of such intimation, the issuing authority shall immediately cancel the same and electronically transmit it to DGFT for onward transmission to the Customs and Regional Authorities.
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