Introduction of new IE Code based on Permanent Account Number (PAN) allotted by the Income-Tax Department - Instructions regarding - Customs - 084/99

Circular No. 84/99-Cus. Dated 16-12-1999 [From F. No. 450/121/99-Cus.IV] Government of India Ministry of Finance (Department of Revenue) Central Board of Excise Customs, New Delhi Subject : Introduction of new IE Code based on Permanent Account Number (PAN) allotted by the Income-Tax Department - Instructions regarding I am directed to say that Ministry of Finance, in consultation with the Ministry of Commerce, has decided that all persons dealing with various regulatory agencies, such as the Central Excise and Customs Department (including Service Tax Administration), Income Tax Department, Offices of Director General of Foreign Trade etc. should be identified with reference to a common identification number. Such common identification number to be used by various Departments will be based on the Permanent Account Number allotted by the Income Tax Department. A background note on this matter is enclosed for your information (see Annexure-I). 2. As you are aware, the Customs Department does not issue any such identification number to importers/exporters, but uses IE Code issued by Director General of Foreign Trade (DGFT) to the importers/exporters. The importers and exporters are required to mention the IE Codes in the Bills of Entry and the Shipping Bills. In pursuance of the above decisions, the DGFT have since issued instructions dated the 16th November, 1999 (see Annexure-II) requiring importers/exporters to furnish their PAN for allotting the new IE Code by the DGFT. 3. It is to be mentioned that w.e.f. 1-1-2000, the importers and exporters would be required to indicate on the customs documents (B/E S/B) both the existing IE Code issued by the DGFT and the PAN issued by the Income-Tax Department. However, from 1-4-2000, the IE Code issued by DGFT based on PAN alone will be used. 4. Appropriate Public Notices may kindly be issued in this behalf for the information of the trade. 5. Please acknowledge receipt of this circular. ANNEXURE-I Background Note on a Common Business Identifier for Importers/ Exporters, Central Excise assessees, Income-tax assessees, etc. Presently, different agencies of the Government use separate numbers for identification of individuals and businesses in relation to the activities concerning the agencies. The Director General of Foreign Trade (DGFT) allocates Importer Exporter Code No. (IEC No.) for identifying importers and exporters, the Income-tax Department issues the Permanent Account Number (PAN) for all Income-tax, Wealth tax assessees, the Central Excise Department is also registering the various manufacturers and allocating a separate series of registration numbers. The RBI separately used to allocate a CNX number for identification of the exporters. The main objective of allocating an alphanumerical number by the Government agencies is to identify the assessees/exporters/importers. It is also used to identify in some cases the concerned office where the person would be assessed or registered. Further an alphanumeric number helps in processing of the information relation to the assessee on computers. A Working Group comprising officers of the different Departments had examined the feasibility of adopting a Common Identifier by the various agencies. It was observed that the assessees will be considerably benefited if he has to obtain just one identification number for use by the various Government agencies. With the increasing import and export activity and universal extension of Modvat, it has become necessary to develop linkages between the import transactions, the manufacturing activity and the export transactions. Besides, maintaining a complete profile of the person concerned, wherein the records of his conduct with any of the Government Departments could be ascertained, such a linkage can help in verification of availment of Modvat, excise rebate on exports etc. Such a measure would be particularly helpful in introducing selective risk based assessment of import/export transactions instead of verification of each and every shipping bill or bill of entry. A common identifier would immediately help obtain an overall assessment of the assessee's credentials with different Government agencies. Various Government Departments particularly the DGFT, the Income-tax and the Customs and Excise Departments are presently engaged in computerisation of their operations. There is need to share information from the computers of one of the Departments with the other Departments. This exchange of information will be made easier if there are common identification numbers. It has been decided to adopt the Permanent Account Number issue by the Income-tax Department as the basis for the Common Identifier. PAN is a 10-digits alpha numeric code and can identify upto 96 crores business entities. Apart from being unique (PAN is issued centrally and is generated by the computer system), it has the widest application (more than 2 crores assessees as against about 3 lakhs importers exporters using IE Codes and about 1.2 lakhs Central Excise assessees using ECC Number). Further, since it is not dependent on the location of the office of registration, it will not get modified on account of re-organisation of jurisdiction of the concerned Department/offices. As per the decision of the Government, PAN will be the only identifier for cross-referencing with the other Departments though each Department is free to use any internal codes which it may consider necessary. This issues in public interest.