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CA Final · Indirect Tax Laws · Foreign Trade Policy

Vikram Overseas failed to pay a penalty imposed under the FT(D&R) Act, 1992. Which action can the Adjudicating Authority take specifically against its Importer-Exporter Code Number under section 11?

The Adjudicating Authority may suspend Vikram Overseas's Importer-Exporter Code until the penalty is paid or recovered. Section 11(7) provides this temporary suspension for non-payment, rather than permanent cancellation, transfer or conversion of the code.

  1. ACancel the IEC permanently without any possibility of revival
  2. BSuspend the IEC until the penalty is paid or recoveredCorrect
  3. CTransfer the IEC to another firm
  4. DConvert the IEC into a restricted code valid for exports only

Explanation

Section 11(7) provides that the IEC of a person who fails to pay a penalty may be suspended by the Adjudicating Authority till the penalty is paid or recovered. Permanent cancellation is not what the sub-section provides. Nothing authorises transfer or conversion of the IEC.

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