Import license

Introduction 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. Definition Permit that allows an importer to bring in a specified quantity of certain goods during a specified period (usually one year). Import licenses are employed (1) as means of restricting outflow of foreign currency to improve a country's balance of payments position; (2) to control entry of dangerous items such as explosives, firearms, and certain substances; or (3) to protect the domestic industry from foreign competition. Process on how to get Import License in India An import export business license in India is called an IEC Code. It is a unique, 10-digit code issued by the government of India to registered Indian companies. The body that is responsible for providing this code is the Director General of Foreign Trade, or DGFT, which is part of the Ministry of Commerce. IEC is the short form of Importer Exporter Code, and the eligibility, legal provisions and other conditions for an IEC Code application is defined under the Foreign Trade (Regulation) Rules, 1993 stated by the Ministry of Commerce. An application for granting an IEC Code number should be made by the organizations Head Office or Registered Office, and to the nearest Regional Authority for the Directorate General Foreign Trade. The applicant must fill up the ANF2A form, which will also state some documents that need to be attached with it during submission. When there are BTP, EHTP or STPI units concerned, the DGFT regional office that has jurisdiction over the location of the STPI unit head office shall issue the IEC Code. For each PAN number, there is only one IEC Code number issued. A proprietor who has more than one IEC Code number would have to surrender the extra ones to the Regional Office and cancel them. The ANF2A form, which is short for Aayaat Niryaat Form, is available on Indolegal.com and you need not walk into the DGFT regional office. Apart from the ANF2A application form, you would also have to submit an Appendix- 18B form. This form must be attested by the banker of the applicant, and must contain the applicants letterhead along with a passport size photograph. You would also need to provide an application fee of around Rs. 250. This fee has to be paid as a Demand Draft or Pay Order from a designated
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bank, drawn in the favour of Zonal Joint Director General of Foreign Trade. The amount can also be paid through Electronic Fund Transfer from a bank nominated by the DGFT. The application for an import and export license must be complete in all the specified areas as per the relevant provisions given by the policies. The applicant also has to sign the application, according to paragraph 9.9 of the policy. If there is any change in the information given in the ANF2A form, the import and export license holder has to intimate it accordingly to the Regional authority that issued the IEC Code number in the first place. 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. 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. Sample of Import License A typical sample of import license consists of two copies1.Foreign Exchange Control Copy: To be utilised for effecting remittance to foreign seller or for opening letter of credit 2.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) vitaminA drugs (by the State Trading Corporation); oils and seeds (by the State Trading
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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.

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. 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. Its 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.