|Consider the following functions of the Foreign Exchange Management Act (FEMA)
|1. FEMA restricts activities such as payments made to any person outside India and receipts from them.
|2. FEMA imposes restriction on people living in India who carry out transactions in foreign exchange, foreign security or who own or hold immovable property abroad.
|3. FEMA regulates the exporters to furnish their export details to RBL. Which of the statements given above is/are correct?
A) 1, 2 and 3
B) 1 and 3
C) 2 and 3
D) Only 1
Correct Answer: A
Solution :[a] The Foreign Exchange Management Act, 1999 (FEMA) is an Act to consolidate and amend the law relating to foreign exchange with the objective of facilitating external trade and payments and for promoting the orderly development and maintenance of foreign exchange market in India. Unlike other laws where everything is permitted unless specifically prohibited, under this act everything was prohibited unless specifically permitted. Hence the tenor and tone of the Act was very drastic. It required imprisonment even for minor offences. Under FERA a person was presumed guilty unless he proved himself innocent, whereas under other laws a person is presumed innocent unless he is proven guilty.
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