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CMA Final · Indirect Tax Laws and Practice · Export Promotion Schemes under Foreign Trade Policy

Meera Software Pvt Ltd exports software services and takes no benefit under the foreign trade policy. The services are not specified services or specified technologies. Under section 7 of the FT(D&R) Act, 1992, which statement is correct?

No IEC is needed. For services or technology, the proviso to section 7 requires an Importer-Exporter Code only where the provider takes benefits under the foreign trade policy or deals with specified services or technologies. Meera Software does neither.

  1. AAn IEC is not necessary for this export of servicesCorrect
  2. BAn IEC is always necessary for any export of services
  3. CAn IEC is necessary only if the value exceeds Rs 1 crore
  4. DAn IEC is necessary only for imports of services

Explanation

The proviso to section 7 requires an IEC for services or technology only when the provider takes benefits under the foreign trade policy or deals with specified services or technologies. Neither condition is met here, so no IEC is needed. A value threshold does not appear in the section.

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