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

Sagar Impex was penalised under the FTDR Act, 1992 and has not paid. Which of the following is a recovery step the Act expressly permits, in the sequence it prescribes?

The certificate route to the Collector, for recovery as arrears of land revenue, is available only if the amount cannot be recovered by deduction from money owing or by detaining or selling goods under customs control. It is a fallback, not the first step. IEC suspension is a separate additional remedy.

  1. AThe Director General may straight away send a certificate to the Collector for recovery as arrears of land revenue, without trying other modes
  2. BRecovery as arrears of land revenue through the Collector applies only if the amount cannot be recovered by deduction from money owing, or by detaining or selling goods under customs controlCorrect
  3. CRecovery is possible only by suspension of the IEC and no other mode
  4. DRecovery can be made only through a civil suit

Explanation

Section 11(5) lists deduction from money owing and detention or sale of goods under customs control first. Only if recovery fails under clauses (a), (b) and (c) may a certificate go to the Collector to recover as arrears of land revenue or property be detained. IEC suspension under sub-section (7) is additional, not the only remedy.

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