Skip to content

CMA Intermediate · Direct and Indirect Taxation · Exemption from Tax

Under Section 11(1) of the CGST Act, 2017, the Government may exempt goods or services generally by notification. Which of the following is a condition for exercising this power?

The Government can exempt goods or services by notification only when it is satisfied that this is necessary in the public interest and acts on the recommendations of the GST Council. The exemption may be absolute or conditional, and may be full or partial.

  1. AThe Government must be satisfied that it is necessary in the public interest and must act on the recommendations of the CouncilCorrect
  2. BThe Government may act on its own without the Council if the exemption is only partial
  3. CThe exemption can only be absolute and cannot carry any conditions
  4. DThe exemption can be granted only for goods and never for services

Explanation

Section 11(1) requires the Government to be satisfied that exemption is necessary in the public interest and to act on the Council's recommendations. The exemption may be absolute or conditional, whole or part, and may cover goods, services or both. The option allowing action without the Council is wrong because the recommendation is always required.

Did you get it right without looking?

One question tells you little. A timed set on Exemption from Tax shows your real accuracy, how long you take and where you lose marks.

Practise Exemption from TaxFree diagnostic mock

More Exemption from Tax questions