Skip to content

CMA Intermediate · Direct and Indirect Taxation · Exemption from Tax

Which combination correctly distinguishes section 11(1) and section 11(2) of the CGST Act, 2017?

Section 11(1) empowers a general exemption by notification for specified descriptions, absolute or conditional. Section 11(2) empowers a special order made in each case under exceptional circumstances stated in the order. Both require public interest and the Council's recommendations.

  1. ASection 11(1) is a special order for exceptional circumstances; section 11(2) is a general notification for specified descriptions
  2. BSection 11(1) is a general notification which may carry conditions; section 11(2) is a special order in each case, stating circumstances of an exceptional nature, and applies to payment of tax on goods or services on which tax is leviableCorrect
  3. CBoth are general notifications, but only section 11(2) needs the Council's recommendation
  4. DBoth are special orders, but only section 11(1) permits conditions

Explanation

Section 11(1) allows a general exemption by notification, absolute or conditional, for goods or services of a specified description. Section 11(2) allows a special order in each case under exceptional circumstances that must be stated in the order. Both need the Council's recommendation and public interest, so the options reversing roles or Council need are wrong.

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