Import / Export & Trade Compliance Advisory

It covers the ongoing compliance obligations that apply once your business is actually importing or exporting — not the one-time registration of an IEC, but everything that follows: correct product classification for Customs, timely realisation of export proceeds under FEMA, keeping your IEC and RCMC active, and making sure you are claiming (and not missing) the DGFT incentive schemes your trade pattern is eligible for. It sits across three separate regulators — Customs (CBIC), RBI (FEMA), and DGFT — because a single shipment touches all three.

An IEC is a one-time (though annually-confirmed) registration — the legal gateway to trade at all. Trade compliance advisory is what happens after: classifying every product correctly, tracking whether your export proceeds are realised on time, making sure your RCMC does not lapse, and reviewing whether you are eligible for and claiming incentive schemes. A business can hold a perfectly valid IEC and still have serious trade compliance gaps in classification, FEMA timelines, or incentive utilisation.

Misclassification cascades in multiple directions: you may pay the wrong Basic Customs Duty (overpaying wastes cash; underpaying creates a demand liability with interest and penalty on audit), you may claim the wrong RoDTEP rate (either under-claiming a legitimate benefit or over-claiming, which invites recovery action), and a product that is actually Restricted or Prohibited under a different, correct HS code may be shipped without the required DGFT licence — which is a serious compliance breach, not just a duty issue.

For most exporters, export proceeds must ordinarily be realised and repatriated to India within nine months from the date of export, under RBI's FEMA current account rules — though the exact period, and any conditions for extension, are periodically reviewed by RBI and can differ for specific categories of exporters or specific circumstances. Unrealised bills are tracked in the Export Data Processing and Monitoring System (EDPMS) through your AD bank. Bills that remain overdue beyond the permitted period risk the bank flagging your export code for caution-listing, which restricts your future banking facilities, and in persistent or large cases can lead to a reference to the Enforcement Directorate for a suspected FEMA contravention.

Yes, in principle — RBI permits extension applications through the AD bank for genuine commercial reasons, such as a buyer's financial difficulty or a commercial dispute, subject to conditions prescribed under FEMA. Where recovery becomes genuinely impossible, a structured write-off route exists under RBI's prescribed framework, again subject to conditions and, beyond certain thresholds, further approval. What matters is that the exporter actively engages the process — applying for extension or write-off — rather than allowing the bill to simply age past the deadline unaddressed.

DGFT requires every IEC holder to electronically confirm or update their IEC details on the DGFT portal every year between 1 April and 30 June. If this update is not completed within the window, DGFT automatically deactivates the IEC — without prior notice. Reactivation requires completing the pending update on the DGFT portal; once done, the IEC is typically restored, though any shipments or bank transactions attempted during the deactivated window will have failed and need to be resubmitted.

A Registration-cum-Membership Certificate (RCMC) is issued by the relevant Export Promotion Council, Commodity Board, or Export Development Authority relevant to your product category. It is a prerequisite for claiming most DGFT export incentive schemes and for certain FTP benefits — without a valid RCMC, DGFT will not process scheme applications tied to that product category. If you are not claiming any DGFT incentive scheme, RCMC is not strictly mandatory for the shipment itself, but most regular exporters obtain and maintain it since incentive eligibility is usually worth the modest renewal cost.

The Export Data Processing and Monitoring System (EDPMS) is RBI's electronic system, operated through Authorised Dealer banks, that tracks every export Shipping Bill against the eventual receipt of foreign exchange proceeds. Your bank monitors your EDPMS position because RBI holds the AD bank responsible for following up on unrealised bills. When your bank asks for FIRC, BRC, or an update on a specific shipping bill, it is fulfilling this EDPMS monitoring obligation on RBI's behalf — not making an arbitrary request.

SVB is a specialised Customs unit that examines the transaction value declared on imports between related parties — where the Indian importer and the foreign supplier share common ownership, control, or a group relationship — because related-party pricing is inherently more susceptible to manipulation than an arm's-length transaction. If your imports are from a parent, subsidiary, or common-control group entity abroad, Customs can refer your import valuation for SVB investigation, which examines whether the relationship has influenced the declared price.

Customs valuation and Income-tax transfer pricing under Section 92 of the Income-tax Act examine related-party pricing from different statutory angles — Customs generally wants to confirm the import price is not artificially depressed to reduce duty, while Income-tax transfer pricing (under the arm's length principle) is generally concerned with whether income has been shifted out of India. In practice these two authorities can reach different, even opposing, conclusions about the same transaction price if a business's positions are not managed consistently. Both angles need a coherent, defensible position — not two contradictory ones.

The Remission of Duties and Taxes on Exported Products (RoDTEP) scheme refunds embedded central, state, and local duties/taxes on exported goods that are not otherwise refunded through GST mechanisms — such as taxes on fuel, electricity duty, or mandi tax embedded in the cost of production. Eligibility and the applicable refund rate are specified against each HS code in the RoDTEP schedule notified by the government. Not every product is covered, and rates differ significantly by product category, so eligibility genuinely depends on your specific HS classification.

It depends on your import-to-export ratio and capital investment pattern. Advance Authorisation suits manufacturer-exporters who import significant raw material inputs specifically for export production and want duty-free imports upfront, subject to fulfilling an export obligation. EPCG suits exporters investing in capital goods (machinery) for export production, offering duty-free import of that machinery against an export obligation over several years. Duty Drawback is the simplest instrument — a post-export refund of duty already paid on inputs — and suits businesses whose import volumes do not justify the compliance overhead of a licence with an export obligation to track.

Both schemes require fulfilling a specified export obligation — typically a multiple of the duty saved, within a prescribed period — in exchange for the duty-free import benefit. If the obligation is not met within the period (including any permitted extension), the licence holder becomes liable to pay back the duty saved, along with interest, and in some cases penalty proceedings under the FTDR Act. A Bank Guarantee or Bond executed at the time of licence issuance secures this liability, and DGFT or Customs can invoke it on default.

Yes, if your goods satisfy the Rules of Origin criteria specified under the relevant agreement and you obtain a valid Certificate of Origin from the prescribed issuing authority. Rules of Origin generally require a minimum threshold of local value addition or a specified change in tariff classification during manufacture — simply routing goods through a country that is party to the FTA, without genuine local processing, does not qualify. India has FTAs and CEPAs with multiple trading partners, each with its own Rules of Origin criteria that must be checked product by product.

Yes. PNPC has an operating office in Dubai alongside our Chennai, Bangalore, and Hyderabad offices in India. For India-UAE trade flows, we coordinate the Indian-side compliance (exporter's IEC, EDPMS realisation, Customs classification for export) with the UAE-side position (UAE Customs import procedures, UAE VAT treatment on the import, and CEPA preferential access where applicable) as a single engagement rather than two disconnected advisory relationships.

DGFT's ITC-HS Schedule classifies every product as Free, Restricted, Prohibited, or State Trading Enterprise (STE)-canalised. Free items require no specific licence beyond a valid IEC. Restricted items require a specific import or export licence from DGFT regardless of IEC status. Prohibited items cannot be imported or exported at all except in narrowly defined exempted circumstances. STE-canalised items can only be traded through the designated State Trading Enterprise. The exact categorisation is product- and HS-code-specific and is periodically updated, so it must be checked against the current ITC-HS Schedule rather than assumed from general product knowledge.

For exports: the Shipping Bill, commercial invoice, packing list, and, where applicable, a Certificate of Origin, export licence (for restricted goods), and any product-specific certification (such as FSSAI for food products or BIS for certain manufactured goods). For imports: the Bill of Entry, commercial invoice, packing list, Bill of Lading or Airway Bill, and any import licence or certification required for the specific HS classification. Customs cross-checks these against the declared classification and value, and against your IEC status on the DGFT system in real time through system integration.

Yes. PNPC represents clients in responding to Customs Show Cause Notices, DGFT deficiency letters, and Directorate of Revenue Intelligence (DRI) or Special Valuation Branch (SVB) inquiries — drafting the formal response, coordinating supporting documentation, and, where the matter proceeds to a personal hearing, preparing the client or appearing alongside authorised representation as the specific proceeding requires.

We recommend an annual structured review at minimum — re-checking IEC and RCMC status, EDPMS ageing, HS classification consistency across the year's shipments, and incentive scheme utilisation — even for businesses with no active compliance issue. We also recommend a review whenever trade volume scales meaningfully, a new product line or export market is added, or a related-party trade relationship is introduced, since each of these changes the compliance profile.

GST is directly relevant. Imports attract IGST at the point of Customs clearance (in addition to Basic Customs Duty), which is available as input tax credit subject to normal GST conditions. Exports are typically zero-rated under GST — either under a Letter of Undertaking (LUT) without payment of IGST, or with payment of IGST followed by a refund claim. RoDTEP and Duty Drawback claims are also reconciled against GST return data by the relevant systems, so a mismatch between your GST filings and your Customs Shipping Bill data can hold up an incentive claim even when the underlying trade transaction is entirely legitimate.

An AD Category-I bank is specifically authorised by RBI under FEMA to handle foreign exchange transactions, including trade-related remittances and receipts. Your IEC and export/import transactions must be routed through an AD Category-I bank account held in the entity's name — a regular domestic-only account cannot process the FIRC, BRC, and EDPMS reporting functions that trade compliance depends on. Most major Indian banks operate AD Category-I licensed branches or divisions for this purpose.

Partially. Services exporters still need a valid IEC, still need to realise export proceeds within the prescribed FEMA timeline, and still generate FIRC records that must reconcile with their invoicing. However, they do not deal with Customs classification, Shipping Bills, or physical port clearance, and the DGFT incentive landscape for pure service exports has been restructured under FTP 2023 — so the specific advisory scope for a services exporter is narrower than for a goods trader, focused mainly on the FEMA/EDPMS realisation side and IEC maintenance.

An LUT is a GST document filed with the tax authorities that allows an exporter to ship goods or services without paying IGST upfront, instead of paying IGST and later claiming a refund. It must be renewed annually (for each financial year) on the GST portal. While this is a GST compliance matter rather than a Customs or FEMA one, it is directly relevant to export cash flow, and we typically review LUT status as part of a comprehensive trade compliance health check since a lapsed LUT forces an exporter into the more cash-intensive pay-and-refund route.

Both models are available depending on the client's need. A one-time comprehensive trade compliance health check or a specific matter (a classification review, an SVB response, an FTA eligibility assessment) is typically quoted as a fixed-fee project. Ongoing compliance calendar management — IEC/RCMC renewal tracking, EDPMS monitoring, periodic classification and incentive review — is typically structured as an annual retainer. The exact scope and fee are confirmed in writing before any engagement begins.

Yes. For businesses scaling trade volume quickly — a new export market, a significant new product line, or a step-change in transaction count — we help design the internal compliance workflow: standardised HS classification documentation, a checklist for new counterparty onboarding (including related-party flagging), EDPMS monitoring cadence, and a compliance calendar integrated with the business's own operations rather than sitting solely with an external advisor.

A CHA is licensed and skilled at the mechanical filing of Bills of Entry and Shipping Bills, coordinating physical clearance, and managing port logistics. A CHA is generally not positioned to advise on the FEMA realisation timeline implications of your payment terms, the transfer pricing consistency between your Customs and Income-tax positions, or whether your trade pattern is leaving DGFT incentive schemes unclaimed. The two roles are complementary, not substitutes — we frequently work alongside a client's existing CHA rather than replacing that relationship.

DRI inquiries are typically triggered by intelligence-based risk indicators — a significant, sudden change in declared value or classification pattern for a product, data-analytics flags comparing declared values against comparable import data, related-party transactions without adequate valuation documentation, or specific intelligence about undervaluation, misdeclaration, or circumvention of anti-dumping duty. A well-documented, consistently classified, and properly valued trade operation significantly reduces the likelihood of being flagged, though DRI inquiries can also arise from broader sector-wide investigations unrelated to any specific fault of an individual importer.

Yes. E-commerce exports still require a valid IEC and are subject to the same Customs Shipping Bill and FEMA realisation framework as any other export, with some procedural nuances around courier-mode Shipping Bills for low-value parcel shipments versus standard export documentation for larger consignments. We advise e-commerce exporters on IEC/RCMC maintenance, HS classification for their product catalogue, and EDPMS realisation tracking, which can be more fragmented across many small-value shipments than in traditional bulk export.

We begin with an initial trade profile review — a conversation covering what you trade, with whom, on what payment terms, and what compliance touchpoints (IEC, RCMC, existing DGFT licences) already exist. From there we scope either a comprehensive health check or a specific matter, confirm the fee in writing, and proceed. There is no requirement to have all your documentation perfectly organised before the first conversation — that assessment is itself part of the engagement.

Because trade compliance genuinely spans three regulators, and the businesses that get into difficulty are usually the ones whose Customs advisor, banker, and DGFT filer never talk to each other. PNPC has advised on FEMA, Customs, and DGFT-adjacent matters as a practising CA firm since 1986, across offices in Chennai, Bangalore, Hyderabad, and Dubai — which means the same team sees your classification decision, your FEMA realisation position, and your incentive scheme eligibility together, and can flag when a decision made for one purpose creates friction for another.