Skip to content

CMA Final · Corporate and Economic Laws · Foreign Exchange Management Act, 1999

Section 9 of FEMA exempts certain matters from the restrictions of sections 4 and 8. Which statement is correct?

Possession of foreign currency or foreign coins up to a limit specified by the Reserve Bank is exempt. Section 9 releases such possession from sections 4 and 8, but other exemptions, like gifts or earnings, also operate only within RBI-specified limits.

  1. APossession of foreign currency or coins up to a limit specified by the Reserve Bank is exemptCorrect
  2. BAny foreign exchange acquired by gift is exempt without any limit
  3. CForeign exchange acquired before 8 July 1947 is exempt only if held in India
  4. DExemption applies to sections 3 and 4 only

Explanation

Section 9(a) exempts possession of foreign currency or coins up to the limit the Reserve Bank specifies. Gifts under 9(e) are exempt only up to an RBI limit. Pre-1947 exchange under 9(c) is held outside India with RBI permission. The exemption is from sections 4 and 8, not 3.

Did you get it right without looking?

One question tells you little. A timed set on Foreign Exchange Management Act, 1999 shows your real accuracy, how long you take and where you lose marks.

Practise Foreign Exchange Management Act, 1999Free diagnostic mock

More Foreign Exchange Management Act, 1999 questions