AD Code AD Code

AD Code for Export in India- Steps to Apply and Registration

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Like the economies of all other countries, India's economy is primarily reliant on exports. Exporters must get an AD (Authorised Dealer) Code in order to send goods and services outside of India. The meaning of an AD code, how to apply for one, register one, how to export from India, and whether exporters can amend their registered AD codes are all covered in this blog post.

Introduction:

India’s exports of goods and services are crucial to the country’s economy. But exporting could be a little difficult, especially for new exporters. Obtaining an Authorised Dealer Code is a necessary step in the exporting process. This code must be obtained by any individual or business wishing to export goods or services from India. In this blog, we’ll examine the definition of an Authorised Dealer code, how to apply for AD code registration, how to register one, how to export from India, and if exporters are permitted to modify their registered AD code.

What is an AD Code?

Indian businesses involved in overseas trade are given a special code called an Authorised Dealer Code by the Reserve Bank of India (RBI). This 14-digit numerical code is used in all exports and imports involving foreign exchange. All importers and exporters in India are required to use the AD code. It is used to track all foreign exchange transactions related to import and export activities.

The Importance of AD Code in Import-Export Business

The AD code is important for the following reasons:

Customs Clearance: The AD code is required for customs clearance of all goods imported or exported from India. Without the AD code, customs clearance cannot be obtained.

Foreign Exchange Transactions: The AD code is mandatory for all foreign exchange transactions related to import and export activities. This includes payments for imports, receipts for exports, and remittances related to these transactions.

Banking Transactions: The AD code is required for all banking transactions related to import and export activities. This includes opening letters of credit, making payments, and receiving payments.

Documents Required for AD Code 

Documents Required for AD Code  

Before applying for an AD Code, gather the following documents to ensure a smooth process:

    • Bank Certificate: Your authorized dealer (AD) bank will issue this certificate in a specific format following Customs Public Notice No. 93/2020 (dated July 29, 2020). You can find a reference copy of the format online or consult your bank for details.
    • Company Identification Proofs:
    • Submit a copy of your company’s Permanent Account Number (PAN) card with a company seal and authorized signatory’s signature.
    • Provide a copy of your Import Export Code (IEC) certificate, also stamped and signed by a company official.
    • Include a copy of your Goods and Services Tax (GST) certificate issued by the relevant authority, along with the company seal and signature.
    • Bank Account Verification: A cancelled cheque from your company’s bank account is required. This cheque should display your company name and account details for verification purposes.
    • Digital Signature Certificate (DSC): For online submissions, a Class 3 Digital Signature Certificate (DSC) is mandatory. You can obtain this certificate from a licensed Certifying Authority. The DSC ensures the authenticity and security of your online application.
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How Do You Apply for an AD Code?

An application for an Authorised Dealer Code must be submitted by the individual or corporate organisation to their specific bank. The application must have certain details including the name of the business, its address, and a valid PAN card number. After the application is submitted, the bank will review the data before giving the AD code.

Steps to Register an AD Code:

The following are the steps for AD code registration:

Step 1: Gather all the required documentation, which includes a cancelled cheque, a PAN card, and an IEC (Import Export Code).

Step 2: Fill out the Authorised Dealer Code Application form, then hand it and the required documentation over to the bank.

Step 3: After receiving the application, the bank will review the information and provide the AD Code.

ICEGATE AD Code Registration Procedure 

Ready to register your Authorised Dealer (AD) Code on ICEGATE? Here’s a breakdown of the process:

  • Step 1: Head to the official ICEGATE website and sign in using your registered user ID and password.
  • Step 2: Once logged in, locate the “Filing Services” section on the ICEGATE homepage. Look for “e-Sanchit” within this section and click on it.
  • Step 3: In the e-Sanchit section, you’ll find an option to upload documents. Make sure you have all the necessary documents for AD Code registration prepared beforehand (refer to the “Documents Required for AD Code” section for details). Upload these documents following the specified guidelines.
  • Step 4: Upon successful upload, the system will generate a Document Reference Number (DRN) and an Invoice Reference Number (IRN). Keep a note of these numbers for future reference.
  • Step 5:  Return to the ICEGATE main page and find the “Financial Services” section. Within this section, locate and select “Bank Account Management.”  From there, choose “AD Code Registration” to proceed.
  • Step 6:  You’ll be presented with an online AD Code registration form. Carefully and accurately fill in all the required details on the form. This includes company information, contact details, PAN Card information, IEC Certificate details, GST Certificate details, and any other relevant information requested.
  • Step 7: Once you’ve double-checked all the information you entered for accuracy, submit the completed AD Code registration form. The ICEGATE system will then process your registration request.
  • Step 8:  After submitting your application, you may receive a confirmation email or notification on the ICEGATE portal acknowledging your registration request. It’s important to stay updated on the status of your AD Code registration and follow up with the relevant authorities if needed.

How to Export from India?

India needs to undertake these steps in order to export goods and services:

To obtain an IEC (Import Export Code), one must get in touch with the Director-General of Foreign Trade (DGFT).

Step 2: Select the appropriate product or service to export and look for possible clients.

Step 3: Consult with the buyer and reach an understanding over the specifics of the contract.

Step 4: Obtain the necessary permits, licences, and approvals for exporting the product or service.

Step 5: Prepare the necessary documents, such as invoices, packing lists, and bills of lading.

Step 6: Make plans for the delivery of the good or service to the customer.

Complete the necessary documents with the customs office and obtain clearance in step seven.

Can Exporter Make Some Changes in or Modify the Registered Authorised Dealer Code?

Yes, an exporter may alter or change an authorised dealer Authorised Dealer code that has been registered. To accomplish this, the exporter must send their particular bank a written request along with the necessary documentation. The bank will review the data and change the Authorised Dealer code if necessary.

Conclusion:

Exporting from India opens doors to exciting global markets, but the legalities can feel overwhelming. This guide clarified the concept of Authorised Dealer (AD) codes, their role in exporting, and the registration process. We also covered the option to change your AD code if needed.

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  • We’ll handle the AD code registration process, ensuring your business is export-ready.
  • From navigating regulations to licenses and permits, we’ll guide you every step of the way.
  • We’ll handle the often-daunting paperwork, so you can focus on your export strategy.

FAQs:

1. How long is an AD code valid for export transactions in India?

An AD code is valid for as long as the entity holds a current account with the bank that issued the code. There is no expiry date for an AD code.

2. Can one AD code be used for multiple ports?

Yes, once an AD code is registered against an Import-Export Code (IEC) at any port, the same code can be used for all ports. There is no requirement for separate registration for each port

3. Are there any penalties for not registering or using an AD code during export transactions?

Yes, there are penalties for not registering or using an AD code during export transactions. The penalties can range from fines to imprisonment, depending on the severity of the offence.

4. How can I verify the authenticity of an AD code?

The authenticity of an AD code can be verified by checking the code against the list of authorized dealers provided by the Reserve Bank of India (RBI). The list is available on the RBI website.

5. Can I modify or update details after registering an AD code?

Yes, details can be modified or updated after registering an AD code. The process for modifying or updating details may vary depending on the bank that issued the code. It is important to contact the bank for specific instructions on how to modify or update details.

6. Who is responsible for ensuring an AD code is attached to export documentation?

The exporter is responsible for ensuring that the AD code is attached to all export documentation. This includes invoices, bills of lading, and other shipping documents.

7. Is there a difference between AD codes for exporters and importers?

No, there is no difference between AD codes for exporters and importers. The same AD code can be used for both import and export transactions.

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About the Author

Sneha Ramesh, Business Development Legal Consultant at Vakilsearch, combines expertise in business law with strategic development. With a proven record in mergers, acquisitions, and partnerships, she aligns legal frameworks with growth objectives. Known for her reliable advice, Sneha ensures compliance, manages risks, and supports sustainable business expansion.

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