In our experience working with many exporters/importers, we have realised that not enough attention is paid to the compliances to be undertaken after availing the benefits from Customs / DGFT. As a result, such exporters/importers knowingly or unknowingly get entangled into the circle of Denied Entity List i.e. blacklisting and it is difficult to come out of it.
# What are general instances leading to Denied Entity List?
- If an Authorisation holder violates any condition of such Authorisation or fails to fulfill export obligation, or fails to deposit the requisite amount within the period specified in demand notice issued by Department of Revenue and /or DGFT
- If any licence has been obtained by fraud, forgery, mis-declaration etc. firm shall be placed in DEL and licensing authority shall suspend the IE code of the firm
- In connection with any investigation, if external agencies like DRI, CBI, ED etc. basis the evidence furnished to the satisfaction of licensing authority, recommend to withhold further licensing facilities he shall place the firm in the DEL after issuing a speaking order against the erring firm
# What is the effect on the firm getting black-listed i.e. DEL?
The firm may be refused grant or renewal of a license, certificate, scrip or any instrument bestowing financial or fiscal benefits. Further, all new licences, scrips, certificates, instruments etc will be blocked from printing/ issue/renewal.
# Sharing our experience
In our practical experience with one of our client, it so happened that the client could not submit documents relating to completion of export obligation within the prescribed time frame under policy. Therefore, they were put under “Denied Entity List” and also denied export incentives like MEIS.
Client approached us to resolve the said matter, but we had hard time resolving the matter successfully. Finally, after our constant efforts and fighting the legal battle, we got our client firm name removed from Denied Entity List, restoring eligibility to avail export incentives.
We highly recommend firms / organisations dealing into export – import to be cautious and be compliant specially after availing any licensing benefits, otherwise the consequences are quite harsh!
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