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Shailza Sharma
| Updated: 31 Jan, 2020 | Category: Government Registration, IEC

Know about the IEC Exemption in India

IEC Exemption in India

IEC is the abbreviation of Import and Export code. The code is 10 digits unique number, which is mandatory for all the exporter and importer. Here it’s important to know that IEC is only applicable to good not on the services. Director-General of Foreign Trade is the authority for issuing the code. Further, all persons / or companies dealing in export and import would require IEC. But there are few categories that are exempted by DGFT from taking this code.

Here we will provide the details of those IEC exempted categories

What is IEC?

 Import and export code shall be obtained by a person or entity which is engaged in the business of import and export, issued by Director General of Foreign Trade[1]. No person or entity shall not make any import or export without obtaining IEC code.

What Categories are exempted from obtaining IEC?

Following categories of importers or exporters are exempted Categories from obtaining IEC number:

  • Importers who are covered by clause 3(1) [except sub-clauses (e) and (l)] and exporters who are covered by clause 3(2) [except sub-clauses (i) and (k)] of the Foreign Trade (Exemption from application of Rules in certain cases) Order, 1993.
  • Ministries or Departments of the State or Central Government.
  • Persons or entity is importing or exporting goods for personal use not connected with trade or manufacture or agriculture.
  • Persons importing/exporting goods from and to Nepal provided that the CIF value of a single consignment does not exceed Rs.25,000.
  • Persons importing/exporting goods from/to Myanmar through Indo-Myanmar border areas provided that the CIF value of a single consignment does not exceed   Rs.25,000.

However, the exemption from obtaining Importer-Exporter Code (IEC) number is not applicable for the export of Special Chemicals, Organisms, Materials, Equipment and Technologies.

Following mentioned are the permanent IEC numbers which shall be used by the mentioned categories of Importers and Exporters mentioned against them for import and export purposes. 

Code Number Categories of Importers/ Exporters
0100000011 All Ministries/Departments of the Central Government and agencies wholly or partially owned by the government.
0100000029 All Ministries or Departments of the State Government and agencies Completely or partially owned by the government.
0100000037 Diplomatic personnel, Counselor officers in India and the officials of the UNO along with its specialized agencies.
0100000045 Indians returning from or going abroad and claiming benefit under the Baggage Rules.
0100000053 Person, Institutions, Hospitals importing or exporting goods for personnel use, not connected with trade or manufacture or agriculture.
0100000061 Persons importing or exporting goods from/ to Nepal provided the CIF value of a single consignment does not exceed Indian Rupees 25000/-.
0100000070 Persons importing/ exporting goods from/to Myanmar through Indo-Myanmar border areas provided the CIF value of a single consignment does not exceed Indian Rupees 25000/-.
0100000088 Ford Foundation
0100000096 Importers who are importing goods for display or use in fairs and exhibitions or similar events under the provisions of ATA carnet.
0100000100 Director, National Blood Group Reference Laboratory, Bombay or their authorized offices.
0100000126 Individuals, Charitable Institutions, Registered NGOs importing goods, which have been exempted from Customs duty under the Notification issued by the Ministry of Finance for valid use by the victims affected by natural calamity.

Read our article:How to Obtain IEC Code in India?

What are the advantages of obtaining IEC?

The IEC code plays the most important role if any individual or entity wants to enter their business into international market. Through import and export code individual or entity gets a great option to expand their businesses in international market. 

Benefits of IEC code is as following;

  • Global Market Reach

As mentioned above, IEC provides an opportunity for the exporter or importer of global reach. Through IEC they can unlock the opportunity available across the globe. 

  • Online IEC Registration

The process of obtaining IEC is completely an online process. The complete online process makes Online IEC registration a less hassle with simplified document list attached therewith to support the application.  

  • Simple Document Requirement

The Import – Export Code can be obtained by any individual and business entity. Below mentioned are the mandatory documents required for the Registration of Import Export Code.

  • PAN Card of the Applicant
  • Address proof of the Business
  • Canceled Cheque
  • Passport Size Photograph of the applicant
  • PAN Based Registration

IEC Code is provided on the basis of Permanent Account Number of the business entity. Therefore, the registration is not required to be based on place of business; instead, a single business entity may require only one

registration. Furthermore, when the business gets dissolved, the registration is also revoked or surrendered.

  • Life Time Validity

IEC registration is valid for lifetime. Hence, there will be no need for updating, filing and renewal the IEC registration. It is valid until the business continues, or till the registration is not revoked or surrendered.

Benefits of Schemes

After obtaining IEC code importer as well as exporters get huge benefits, in terms of subsidies or otherwise declared by the Customs, Export Promotion Council or by any other authority. Even after filing LUT under GST, the exporters can make exports without making any payment of taxes.

  • No Compliance

Obtaining IEC code is much hassle-free in comparison to any other tax registrations. There is no such requirement of filing any annual filing or returns. Furthermore, there is no compliance requirement after registration.

  • Legally Clean

Obtaining Import Export code importing and exporting goods, works as chief legal license that makes the cross border transactions easy and legal.

Takeaway

IEC is mandatory before commencing the import and export business. Any individual or any business entity can obtain the license who wishes to expand his/her business on international level. DGFT keeps some categories exempted from obtaining the IEC code, which shall be kept in mind to avoid any kind of rejection in getting the IEC.

Read our article:How To Apply For FIEO Registration?

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Shailza Sharma

Miss Shailza Sharma, BA. LLB graduate from Himachal Pradesh University. She holds an experience of 2.5 years in various Legal companies and organizations.

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