IEC is a ten-digit authentication number assigned to a person seeking to engage with an import-export business in India. It is mandatory, and hence it should be avail on time to avert underlying penalties. There is some confusion among the IEC holders about whether such a license is subjected to periodic renewal or not. This write-up would render some key details around IEC Registration Renewal and surrender.
What is IEC, and who grants it?
IEC serves as an elementary legal approval for exporters and importers in India. The prime authority that grants IEC registration in India is the Directorate General of Foreign Trade.
What about the IEC Registration Renewal-is it possible?
In the status quo, the IEC Registration comes with lifetime validity. That means there is no need to renew it periodically, unlike other licenses. Therefore, there is no scope for IEC registration renewal at the current time.Â
Now let us precede to the next section that talks about the surrender of IEC registration.
What is the meaning of Surrender of IEC?
There are times when businesses wish to wrap up their operation because they are no longer interested in doing the same, or they may be confronting losses for a long time. Under such circumstances, one must surrender their IEC registration before the authority concerned to avert any chances of misuse. Common reasons for surrendering IEC involve closure of EXIM unit, winding up of company, the unwillingness of business owner to continue the business journey, etc.
Key point to ponder for surrendering the IEC registration
It’s noteworthy that the IEC is granted against the individual PAN or on a company PAN. Therefore, the business owner must avoid surrendering their IEC registration which is yet to be linked with the PAN. In such a case, they must apply for new IEC registration.
This reason could prevent the exporter or importer from re-applying for the IEC registration with the same PAN even after surrendering the IEC.
Online procedure of surrendering IEC registration
Applicants can visit the DGFT portal and file an application for electronically surrendering the IEC license. The portal shall prompt the applicant to upload the requested documentation during form filling. Upon application submission, the authority shall initiate the vetting process and revoke the license accordingly.
The process for surrendering IEC registration is as follows:
Step 1: Visit the DGFT portal
Log in to the DGFT portal; select the services option from the main menu.
Step 2: Opt for ‘IEC Profile Management’
Under services, from the drop-down menu, opt for the ‘IEC Profile Management[1]’ option.
Step 3: Select ‘Surrender of IEC’
Under the ‘IEC Profile Management’ option, select ‘Surrender of IEC’.
Step 4: Login or Create an account
The portal further prompts the applicant to log in by notifying them via email. Those who do not have an account can create the new one by entering required details like phone number, contact detail, etc.
Step 5: Select the Surrender option post login
Post login, the user must cross-check the submitted details such as company name, PAN, etc. Once done, tap on the option called ‘surrender’.
Documents to be arranged for Surrender of IEC
- Documents evidencing the company’s location
- Business registration
- PAN of IEC holder
- True copy of IEC registration
- The covering letter addressed to the Additional Director General of Foreign Trade
DGFT shall share the information relating to the surrender of IEC with authorities like RBI, Custom, etc., as soon as the applicant meets the above formalities.
Surrender norms around dual registration
DGFT prohibits the allotment of two IEC registrations against a single PAN. The breach of this condition shall provoke significant penalties for the defaulter. In the case of dual registration, the entity in question must return one registration to the authority to avert fines.
Surrender of IEC and IEC registration suspension: Are they interrelated?
- Surrendering of IEC is usually a voluntary act of the license holder. Meanwhile, the suspension is something that is triggered by the authority in case of non-compliance.
- There are several grounds that trigger the chances of suspension. Some noteworthy grounds include non-compliance with FTP guidelines, breach of shipping norms, illegal shipment practices, etc. The authority provides a fair chance to the defaulter to defend their stand before penalizing them.
- The surrender of IEC primarily refers to voluntary submission of IEC registration to the authority, i.e. DGFT. Such an act usually comes to effect when the owner is no longer interested in carrying out business activities due to any reason.
- Meanwhile, the decision regarding the IEC suspension is entirely at the discretion of the DGFT. It typically comes to effect when the authority has a strong reason to believe that licensee is not complying with underlying conditions.
- Post surrendering or registration suspension, the applicant in question would no longer be able to perform EXIM activities. The absence of a valid license shall prevent them from engaging with the shipping business again.
Conclusion
There is no such thing as IEC Registration Renewal since it comes with lifetime validity. Hope this write-up has cleared your doubts around these debatable subject matters, i.e. IEC Registration Renewal and surrender. Feel free to prompt us or write to us if you need detailed information on the same.
Read our Article:What is the IEC Registration Process in India?
