Corporate and Other LawsQuestion 5363 of 221
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12. Considering the provisions of the FEMA, 1999 decide upon the process of releasing the containers from Italian ports by the Indian company.

Options

AAHBL shall have to obtain prior permission of Ministry of Surface Transport (DG Shipping) for payment of the det ention charges as it exceeds the rates as prescribed by Director General of Shipping.
BAHBL shall have to obtain prior permission of both Ministry of Surface Transport as well as Ministry of Finance, Department of Economic Affairs as the transaction involves payment of foreign exchange as detention charges.
CAHBL shall have to obtain prior permission of Ministry of Finance, Department of Economic Affairs for payment of the detention charges as it exceeds the rates as prescribed by Director General of Shipping.
DAHBL need not obtain permission from any government authorities in India as now the ship is at the Italian ports away from Indian Jurisdiction.
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Correct Answer

Option AAHBL shall have to obtain prior permission of Ministry of Surface Transport (DG Shipping) for payment of the det ention charges as it exceeds the rates as prescribed by Director General of Shipping.

All Options:

  • AAHBL shall have to obtain prior permission of Ministry of Surface Transport (DG Shipping) for payment of the det ention charges as it exceeds the rates as prescribed by Director General of Shipping.
  • BAHBL shall have to obtain prior permission of both Ministry of Surface Transport as well as Ministry of Finance, Department of Economic Affairs as the transaction involves payment of foreign exchange as detention charges.
  • CAHBL shall have to obtain prior permission of Ministry of Finance, Department of Economic Affairs for payment of the detention charges as it exceeds the rates as prescribed by Director General of Shipping.
  • DAHBL need not obtain permission from any government authorities in India as now the ship is at the Italian ports away from Indian Jurisdiction.

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Detailed Solution & Explanation

Under Schedule II of the Foreign Exchange Management (Current Account Transactions) Rules, 2000, prior approval of the Central Government (specifically the Ministry of Surface Transport / DG Shipping) is required for payment of detention charges exceeding the rates prescribed by the Director General of Shipping.
Since the detention charges to be paid by the seller exceed the prescribed rate, AHBL must obtain prior permission from the Ministry of Surface Transport (DG Shipping).
Hence, **Option A** is the correct answer.

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