All businesses engaged in importing and exporting goods must have an Importer Exporter Code
IEC registration, or Import Export Code registration, is required by a person for importing or exporting goods and services from India. It is a 10 digit code issued by the Directorate General of Foreign Trade (DGFT), Ministry of Commerce and Industries, Government of India. All businesses engaged in import and export of goods and services require registering IEC. Even individuals who are proprietors of a business can obtain IEC in their name. Without this code, importers are not allowed to proceed legally nor are the exporters allowed to benefit from DGFT, customs, etc.
The IE Code has lifetime validity and hence doesn’t require a renewal or filing. Even if import or export transactions occur, there are no filings required to DGFT. It is thus recommended for most entities to acquire IE Code, irrespective of if they need it at the moment.
The IE Code must be quoted by importers while clearing customs and by exporters while sending shipments. Also banks require IE Code while sending and receiving money from abroad.
Once issued, the IEC is valid throughout the country at any point of time. IEC needs to be only quoted while transferring any goods or money.
The IEC is just a code. Once you obtain it, you can start importing/exporting. You don’t have to file the transactions nor pay any taxes.