CA Final · Indirect Tax Laws · Warehousing
Bharat Spirits Ltd warehoused imported goods under a bond executed under section 59. Over the next months, part of the goods was cleared for home consumption and the rest was exported. All duty, interest and other amounts due on the goods have been paid. Which statement correctly describes the position under section 73?
The proper officer must cancel the bond as discharged in full and deliver it, on demand, to the person entitled. Section 73 applies once all goods are cleared, exported, transferred or otherwise accounted for and all amounts due are paid.
- AThe proper officer shall cancel the bond as discharged in full and, on demand, deliver the cancelled bond to the person entitled to receive itCorrect
- BThe bond continues in force until the warehouse licence of the premises is surrendered
- CThe bond is cancelled only after the importer furnishes a fresh security equal to thrice the duty
- DThe bond can be cancelled only by the Board and not by the proper officer
Explanation
Section 73 provides that when the whole of the goods covered by the bond have been cleared for home consumption, exported, transferred or otherwise duly accounted for, and all amounts due are paid, the proper officer shall cancel the bond as discharged in full and deliver it on demand. The other options add conditions that the section does not contain.
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