ANIL KUMAR YADAV
LEGAL ENVIRONMENT FOR BUSINESS
MS NUPUR CHOPRA
EXPORT DOCUMENTATION PROCEDURE
It is important that a person engaged in international trade be aware of the various procedures involved. The business of export is heavily document-oriented and one must get acquainted with the entire procedure. Failure to comply with documentary requirement may lead to financial loss. There is some process in export house:
The exporter is required -to register his organisation with a number of institutions and authorities, which directly or indirectly help him in the smooth conduct of export, trade. It includes:
A. Registration of the Organisation: The form of organisation selected by the exporter must. Be registered under the appropriate Act of. the country. * A joint stock company under the Companies Act, 1956.;
* A partnership firm under the Indian Partnership Act, 1932.; * A sale trader should seek permission from the local authorities, as required.
B. Opening-Bank Account: The exporter should open a current account in the name of the firm or company with a commercial bank which is authorized by the Reserve Bank of India (RBI) to deal in foreign exchange. Such bank also serves as a source of pre-shipment and post-shipment finance for the exporter. C. Obtaining Importer-Exporter Code Number (lEC No): Prior to 1.1.1997, it was obligatory for every exporter to obtain CNX number from the RBI. However, since then, IEC number issued by the Director General for Foreign Trade (DGFT) has replaced the CNX number. The application form for obtaining IEC number should be accompanied by fee of Rs. 1000. D. Obtaining Permanent Account Number- (PAN): Export income is subject to a number of exemptions and deductions under different sections of the Income Tax Act. For claiming such exemptions and deductions, the exporter should register his organisation with the Income Tax Authorities and obtain the Permanent Account Number (PAN). E. Obtaining Sales Tax Number: Exportable goods are exempted from sales tax, provided, the ‘exporter or his firm is registered with the Sales Tax Authorities. , For this purpose, the exporter is required to make an application in the prescribed form to the’ Sales Tax Office (STO). F. Registration with, Export Promotion Council (EPC): It is obligatory for every exporter to, register with the appropriate Export Promotion Council (EPC) and obtain the ‘Registration-cum-Membership Certificate’ (RCMC). The benefits provided in the current EXIM Policy are extended only to the registered exporters having valid RCMC. G. Registration with ECGC: The exporter should also register with the Export Credit and Guarantee Corporation of India (ECGC) in order to secure overseas payments against political and commercial risks. It also helps the exporters in obtaining the financial assistance from commercial banks and other financial institutions. H. Registration with other Authorities: The exporter should also register with various other authorities, such as: - · Federation of Indian Export Organisation (FIEO),· Indian Trade Promotion Organisation (ITPO), · Chambers of Commerce (COC), · Productivity Councils, etc.
Export, cargo can be exported to the overseas buyer by sea, air or land. However, shipment by sea is the most popular and generally resorted to, as it is comparatively cheaper. Besides, the ship’s capacity is far greater than other modes of transportation. Nevertheless, transportation by air is utilized for export of expensive items like, diamonds, gold, etc. It includes the following process:
A. Reservation of Shipping Space: Once the export contract is finalized, the I exporter reserves the required space in the vessel for shipment. On accepting the exporter’s request, the shipping company issues a...
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