Information technology (IT) simplified export import functioning in India. It made all working of Custom department and Banking system very easy and systematic.
There are three revolutionary changes witnessed by Indian exporters/importers which transforms physical documentation into digitalization.
Directorate General Foreign Trade (DGFT) launched eBRC platform in 2012, RBI launched EDPMS and IDPMS system in 2014 and 2016 respectively.
eBRC platform introduced by Directorate General of Foreign Trade (DGFT) in 2012. Prior to eBRC era, it was quite cumbersome task to get Bank Realization Certificate (BRC) from AD. Once export gets inward remittance from overseas vendors, Original physical Exchange Control Copy of shipping bills needs to be submitted along with BRC application, thereafter AD was issuing BRC to exporter.
Export Data Processing and Monitoring System (EDPMS) was launched by RBI in March 2014 to monitor payments against Export Bill (Shipping Bill) . It is a system where all export transactions are captured and followed up till their realization. Outstanding get recorded by AD mentioned in shipping bill at the time of export.
AD send reminders to exporter if inward remittance not received within time period of 6 months.
If exporter continuous ignored communication from AD, then AD is liable to report to RBI for default of such exporters, thereafter RBI initiate panel action against violation of FEMA provisions.
IDPMS (IMPORT DATA PROCESSING AND MONITORING SYSTEM) LAUNCHED BY RESERVE BANK OF INDIA (RBI) IN 2016
This was the revolutionary step for digital control of Import towards a paperless documentation. Prior to IT based IDPMS era, importers and custom department required to keep original copies of bill of entry (Original for custom, duplicate for availing CENVAT Credit, Triplicate exchange control copy for making foreign remittance against imported goods). If importer lost triplicate copy, it required huge documentation process to make remittance against import. Bank mandatorily required Exchange Control Copy to avoid double payment against single bill of entry.
Post IDPMS era, importer does not require to keep original bill of entry, photocopy of bill of entry is enough for availing Input Tax Credit (ITC) and Bank also does not ask for original bill of entry for making foreign remittances.
In order to enhance ease of doing business and facilitate efficient data processing for payment of import transactions and effective monitoring thereof, Import Data Processing and Monitoring System has been developed in consultation with the customs authorities and other stakeholders.
RBI does not directly interact with imports. RBI interact with importers through Authorized Dealer (AD).
An Authorized Dealer (AD) is any person specifically authorized by the Reserve Bank under Section 10(1) of FEMA, 1999, to deal in foreign exchange or foreign securities
If we will have to start import transactions with overseas vendors, you would have to first get your self registered with Directorate General of Foreign Trade (DGFT) and get a Import Export Code (IEC). You would have to register AD code with Custom Department. For registering Code with Custom, you would have to submit details of AD code of your banker on banker letter head.
Primary data on import transactions from Customs and SEZ will first flow to the RBI secured server and thereupon depending on the AD code shall be shared with the respective banks for taking the transactions forward. The AD bank shall enter every subsequent activity, viz. document submission, outward remittance data, etc. in IDPMS so as to update the RBI database on real time basis.
All transactions are being updating in IDPMS, so there is no risk of double remittance, as a result no need of physical exchange control copy of bill of entry. If you will proceed double remittance by mistake, bank will deny for such remittance because after remittance it will automatically remove from outstanding list and will shift to settled bill of entry.
If you will not make foreign remittance within time limit as per RBI guideline, AD will send you reminders for settlement of outstanding to overseas vendors. If you will ignore such reminders, AD will be liable to intimate RBI for default of FEMA. RBI will initiate penal action against importer towards violation of FEMA.
Pushkar Mer 