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CA Final · Indirect Tax Laws · Importation and Exportation of Goods

The Central Government is satisfied that an uncontrolled export of a certain agricultural product would cause a domestic shortage. Which statement about its power under section 11 of the Customs Act, 1962 is correct?

The Central Government can prohibit the export by notification in the Official Gazette, either absolutely or subject to conditions, because preventing shortage of goods is a listed purpose in section 11(2). It covers exports as well as imports and needs a notification.

  1. AIt may prohibit export only absolutely and not subject to conditions
  2. BIt may prohibit by notification in the Official Gazette, absolutely or subject to conditions, if necessary for a purpose such as the prevention of shortage of goods of any descriptionCorrect
  3. CIt may prohibit by executive order without notification for any purpose it chooses
  4. DIt may prohibit only imports, not exports, under section 11

Explanation

Section 11(1) empowers the Central Government by notification in the Official Gazette to prohibit import or export of specified goods, absolutely or subject to conditions, if necessary for a purpose in sub-section (2), which includes prevention of shortage of goods of any description. It covers both import and export and requires notification.

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