Frequently Asked Questions (FAQs) about Import Export in India

FAQs about Import Export
Japsanjam Kaur Wadhera
| Updated: Jan 09, 2021 | Category: IEC

With the growth in the Import Export trade business, many business owners are now willing to engage themselves in this industry and expand their business. This helps them to get exposure of the global market and earn more profits. It is necessary to obtain Import Export Code registration to execute international transaction or to trade in globally markets. However, there are some questions that may arise at the end of the traders regarding the Import Export business. Hence, this article will guide you by providing the answers to the Frequently Asked Questions (FAQs) about Import Export in India.

What are the Frequently Asked Questions (FAQs) about Import Export in India?

Q1. Is it necessary to obtain Import Export Code (IEC) for Import of goods?

A1. It is necessary to obtain IEC code for Import. However, certain categories of importers are exempted from obtaining Import Export Code. The details regarding the categories of importers exempted from obtaining IEC may be seen at Para 2.8 of Handbook of Procedure, Vol.-I on the DGFT website.

Q2. Is there a separate code required for Import and Export?

A2. No separate Code is required for Import and export and the same IEC can be used for both. Many people have a wrong Idea that a separate IEC code is required, but it is not true. Only one registration is required which is mandatory for the import and export and the same IEC code can be used while importing as well as exporting. There are many benefits on obtaining IEC code for businesses.

Q3. Is there a need to obtain IEC code for import or export of goods for personal use?

A3. IEC code is not required for import or export of goods for personal use. The Import Export Code is mandatory only for commercial purposes and business. One can import or export goods for personal use without any registration requirement.

Q4. What is a ‘Restricted Item’ and where are they listed?

A4. Those goods, import of which is permitted only with the Permission/ Licence/Authorisation or in accordance with the procedure prescribed in a Public notice/ Notification are termed as ‘Restricted’ items. The list of ‘Restricted’ items is available in the (ITC- HS) classification of import and export items and the same can viewed under the download section in DGFT website[1].

Q5. What is ITC (HS) Code?

A5. The ITC (HS) Code is known as Indian Trade Classification (Harmonised System) Code which was adopted in India for exporting importing operations. An 8 digit ITC (HS) Code is used by the Indian customs for the national trade requirements.

Q6. How to find HS code for a product?

A6. To know the HS code for a product, click on the ‘ITC (HS) based policy’ on the official website of DGFT. An ITC (HS) query form will get open in a new window. Insert the product’s name in the description option o know the HS Code of the product. If, one is already aware of the HS code and wants to know the product, then enter the ITC (HS) code option to know the product.

Q7. Is there a need to renew the IEC Code in India?

A7. The registration of IEC is a onetime registration and has the validity for a lifetime. Therefore, there is no need to renew the IEC code.

Q8. Is there a need to file returns for IEC?

A8. The IEC code is required at the time of exporting or importing or receiving or paying payments. There is no need to file returns for IEC as there are no post registration compliances.

Q9. What does a business owner who wishes to start Import Export Trade needs to know before going global?

A9. It is important for the business owner who wishes to engage in Import Export trade to be thorough and know his product and service perfectly. The business owner must know what makes his products unique. He must analyze the market of the target country and must evaluate the pros and cons carefully of going there including an estimation of the risks and the costs involved in it.

Q10. Do government departments need to obtain IEC Code?

A10. The Central and State Government do not require obtaining IEC registration. A fixed number is allotted to them which is used for any such transactions.

Q11. Is IEC registration required despite having GST?

A11. It is necessary for every person who imports or exports to obtain IEC registration. It is necessary to register with DGFT department even if the business is registered under GST.

Q12. What are the conditions in which IEC code is not required?

A12. IEC Code is not required when: –

  1. The import and export is done by the government departments
  2. The import and export is done by certain notified charitable NGOs.
  3. Products for personal use are imported or exported.

Q13. Why is Import Export business regulated by the Government?

A.13 The government imposes restrictions on imports and exports for the following reasons: –

  1. Protect the morals of the public.
  2. Protect the lives of the humans, animals and plants.
  3. IPR protection.
  4. To maintain the artistic, historic and archaeological value of national treasure.
  5. To conserve the exhaustible natural resources.
  6. To discourage and limit the trafficking of war related items, weapons and illegal drugs.
  7. Prevent the use of prison labour.

Q14. What is Foreign Trade Law?

The India’s foreign trade legislation is controlled by the Foreign Trade (Development and Regulation) Act, 1992. Through this policy, the Indian government permits the imports into India and encourages exports from India.

Conclusion

The Import Export in India is growing rapidly and helping the business and manufacturers to expand their business and grow. Import Export helps the businesses to compete with the global market and allow them to avail many benefits from import export business. The government encourages the businesses who are engaged in the import export trade. Certain Frequently Asked Questions (FAQs) about Import Export in India are discussed above in the article that usually arises for trading goods to or from India.

Also, Read: All That You Need To Know: When IEC Code is Required?

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Japsanjam Kaur Wadhera

Japsanjam Kaur Wadhera is an Advocate and has completed her BA.LLB (Hons) and has experience of writing various research papers during her college time. Earlier she was working as an Associate Advocate in a reputed Law Firm. She has an extreme interest in writing legal content and her core area falls under legal enactments, tax and finance.

 

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