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CS Executive · Setting Up of Business, Industrial and Labour Laws · Setting up of Business outside India and Issues Relating thereto

Under Section 37A of FEMA, an Authorised Officer suspects that foreign security worth a prescribed amount held abroad by Kabir breaches Section 4. Which statement is correct?

The Authorised Officer may seize equivalent value situated within India after recording reasons in writing, and must place the order with relevant material before the Competent Authority within thirty days of seizure. The 180 days applies to the Competent Authority's disposal, and seizure is barred below the prescribed value.

  1. AHe may, after recording reasons in writing, seize value equivalent situated within India, and must place the order before the Competent Authority within thirty daysCorrect
  2. BHe may seize the foreign security itself abroad without recording reasons
  3. CHe must place the order before the Competent Authority within one hundred eighty days of seizure
  4. DHe may seize even if the aggregate value is below the prescribed value

Explanation

Section 37A(1) allows seizure of equivalent value within India after recording reasons, and 37A(2) requires placing the order before the Competent Authority within thirty days. The 180 days is the period for the Competent Authority to dispose of the matter, and no seizure is allowed below the prescribed value.

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