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CA Intermediate · Corporate and Other Laws · The Foreign Exchange Management Act, 1999

Kiran Exports, a resident exporter, shipped goods to a buyer in Dubai. Under FEMA, which statement about the duty of an exporter is correct?

An exporter must furnish a declaration of the full export value and take all reasonable steps to realise and repatriate the export proceeds to India within the prescribed period and manner. Retaining proceeds abroad or shifting the duty to the buyer is not permitted under FEMA.

  1. AAn exporter must furnish a declaration of export value and, within the prescribed period, take all reasonable steps to realise and repatriate the full export value to IndiaCorrect
  2. BAn exporter may retain export proceeds abroad indefinitely
  3. COnly the buyer is responsible for the export declaration
  4. DExport realisation is required only if the value exceeds Rs 10 crore

Explanation

FEMA requires every exporter to furnish a declaration or information to the RBI or authority specified, containing the true full export value, and to take all reasonable steps to realise and repatriate the export proceeds within the period and manner prescribed. Option B contradicts this. Options C and D invent conditions.

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