Indian Importers And Exporters Should Remember This New Rule Regarding IEC

The union government of India will start the procedure to deactivate Import Export Code (IEC) from October 6, 2021 for the firms, which have not updated their information to the government. As the government mentions, the IEC is a key business identification number, mandatory for export or import business. No firm should operate an export or import business without an accurate IEC Number granted by the Directorate General of Foreign Trade (DGFT), India.

An official said to Indian Express (IE), "We don't have their emails or phone numbers, there are people who got IECs 20 years back." He additionally indicated that the deactivation procedure of these IECs will be a part of the clean-up efforts by the union government. The first phase will be started in October, this year, and the DGFT will be monitoring the whole process. At that time the government will deactivate the IECs of those firms, which have not updated the official details since the beginning of 2005. So, the Indian exporters and importers, who have not submitted their updated information to the government, should be cautious now. They must update the information as soon as possible to avoid the deactivation of IEC.

This year, the DGFT had amended the IEC rule and said that the import or export firms will require to update their details every year between April and June. Later, the timeline was extended for firms to update details this year till the end of August based as the industry made multiple requests.

Why did the DGFT become that much concerned?

The Directorate of Revenue Intelligence (DRI) arrested 2 Afghan nationals from Shimla, Himachal Pradesh recently, which is connected to the 3000 kg heroin seizure case from the Mundra port, Gujarat, in the last week. It was found by the DRI in a consignment classified as a 'semi-processed talc stones', which was imported by the Aashi Trading Company. This company had done the same misconduct even in June, this year. According to government sources who spoke to IE, "The company records were not available with the registrar of companies on the website of the Ministry of Corporate Affairs (MCA)." Through the move to deactivate backdated IECs, the government is trying to deactivate the IEC of companies like Aashi Trading. These are some of the 'front organizations', which do illegal business staying behind. So, the legal importers and exporters should remember the rule to update the information of IEC as soon as possible.