Skip to content

CMA Intermediate · Direct and Indirect Taxation · Exemption from Tax

Under the CGST Act, 2017, which statement correctly describes the power of the Government to grant a general exemption by notification under section 11(1)?

The Government may exempt goods or services of a specified description by notification when satisfied it is in the public interest, acting on the Council's recommendations. The exemption can be absolute or subject to conditions specified in the notification, from a date the notification specifies.

  1. AIt may be exercised on the recommendations of the Council, in public interest, absolutely or subject to specified conditionsCorrect
  2. BIt may be exercised without the Council's recommendation if the Government considers it expedient
  3. CIt can only be granted absolutely and never subject to conditions
  4. DIt can only be granted for a specified person and not for goods or services of a specified description

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 subject to conditions, and it applies to goods or services of a specified description. The option dropping the Council's role or barring conditions contradicts the text.

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