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IFSCA - Regulations, Listing and Compliances · IFSCA Ecosystem and Regulatory Framework

IFSCA Members: Term, Removal, Meetings and Powers

Updated 11 October 2026 · Fact-checked

The IFSCA Act, 2019 makes the Authority the regulator that develops and regulates financial products, services and institutions in IFSCs. The Chairperson and Members serve three-year terms, can be re-appointed, and can be removed by the Central Government on listed grounds. Decisions are taken by majority vote at meetings.

Understand Powers, Functions and Term of Members

The International Financial Services Centres Authority is the single regulator for financial products, financial services and financial institutions in International Financial Services Centres (IFSCs). Its duty is set out in Section 12: to develop and regulate them by such measures as it deems fit.

The Act then gives the Authority powers and functions. They include regulating products, services and institutions already permitted by another regulator before the Act began, and regulating other products, services or institutions the Central Government notifies. The Authority can also recommend to the Central Government new products, services and institutions that may be permitted in an IFSC. It performs other functions as may be prescribed.

The Authority works through its Members. Section 6 fixes their term and conditions, Section 7 lists the grounds for removal, and Section 8 governs meetings. Other sections control the Authority itself. The Central Government can give policy directions (Section 21), can supersede the Authority (Section 22), and the Authority can delegate powers (Section 23) and make regulations (Section 28).

For an exam answer, think in layers: what the Authority does, who runs it, how they hold office, how they leave, and how they decide. Each layer has a section. Learn the section-to-subject match and the exact conditions, such as ages, notice periods and who must be heard.

Key rules to remember

Duty of the Authority (Section 12(1))
Develop and regulate financial products, financial services and financial institutions in IFSCs, by such measures as it deems fit
Subject to the provisions of the Act. Section 12(2) is without prejudice to this general duty.
Term of office (Section 6(1))
Chairperson and Member: 3 years from entering office; eligible for re-appointment
Proviso: no Chairperson after age 65; no whole-time member after age 62.
Resignation (Section 6(3)(a))
Written notice to the Central Government of not less than 3 months
Removal is separately under Section 7.
Post-service restriction (Section 6(4))
For 2 years after ceasing office, no employment under the Central or a State Government, and no appointment in a financial institution in the IFSCs, without previous approval of the Central Government
Does not apply to ex officio Members.
Removal grounds (Section 7)
(a) insolvent; (b) physically or mentally incapable; (c) convicted of offence involving moral turpitude in the Central Government's opinion; (d) financial or other interest prejudicial to functions; (e) abuse of position making continuance detrimental to public interest
Hearing is required only for clauses (d) and (e).
Decisions at meetings (Section 8(3))
Majority of Members present and voting; on a tie, Chairperson (or the person presiding) has a casting vote
If the Chairperson cannot attend, the Members present choose one of themselves to preside.
Interested Member (Section 8(4))
Disclose interest in writing as soon as possible; disclosure recorded in proceedings; Member takes no part in deliberation or decision on that matter
Applies to direct or indirect interest.
Supersession (Section 22)
By notification, with reasons, for a period not exceeding 6 months, after a reasonable opportunity to the Authority to make representations
Chairperson and Members vacate office; the Authority must be reconstituted by the end of the period; the notification and report are laid before Parliament.

How to solve Powers, Functions and Term of Members questions

Use this method for any question on the Authority's powers, Members, removal or meetings. Work from the facts to the section, then to a conclusion.

  1. 1Identify the subject of the question: function of the Authority, tenure, resignation, removal, meetings, delegation, direction or supersession.
  2. 2Match it to the section: 12, 6, 7, 8, 21, 22, 23 or 28. Name the section only when you are sure of it.
  3. 3State the rule in plain words with its exact conditions, such as three years, age limits, three months' notice, or the hearing proviso.
  4. 4Apply the rule to each fact in the problem. Check ages, dates, the type of Member, and which removal clause fits.
  5. 5Check for exceptions: ex officio Members, the hearing proviso for clauses (d) and (e), the casting vote, and the power that cannot be delegated (Section 28).
  6. 6Write a clear conclusion, and add a practical point if relevant, such as recording a disclosure in the minutes.

Quickest way: Section-map recall

When to use it: Use when you have little time and the question asks which provision applies or whether an act is valid.

  1. Write the map first: 12 functions, 6 term, 7 removal, 8 meetings, 21 directions, 22 supersession, 23 delegation, 28 regulations.
  2. Underline the key words in the facts, such as age, notice, tie vote, interest or insolvency.
  3. Pick the matching section and recall its one or two numbers.
  4. Write rule, application and conclusion in three short parts.

Common mistakes in Powers, Functions and Term of Members

  • Saying every removal needs a hearing.

    Students remember the natural justice idea and apply it to all grounds.

    Fix: The proviso to Section 7 requires a reasonable opportunity of being heard only for clause (d) and clause (e).

  • Mixing up the age limits of 65 and 62.

    Both numbers sit in one proviso.

    Fix: Chairperson: not after 65. Whole-time member: not after 62.

  • Confusing resignation notice with removal.

    Both end the term early and appear in Section 6(3).

    Fix: Resignation is the Member's act with at least three months' written notice. Removal is by the Central Government under Section 7.

  • Letting an interested Member vote.

    Students think disclosure alone is enough.

    Fix: Under Section 8(4) the Member must also stay out of deliberation and decision on that matter, and the disclosure must be recorded.

  • Treating supersession as permanent or as an end of the Authority.

    The word suggests abolition.

    Fix: It lasts for a period not exceeding six months, and the Authority must be reconstituted by the end of it. Former Members are not disqualified from re-appointment.

  • Saying all powers can be delegated.

    Section 23 sounds general.

    Fix: Delegation excludes the powers under Section 28, the power to make regulations.

Worked examples

Example 1

Mr. Rao, a whole-time Member of the Authority, is convicted of an offence which the Central Government considers involves moral turpitude. Can he be removed, and must he first be heard?

Show the solution
  1. Provision: Section 7 lets the Central Government remove a Member convicted of an offence which in its opinion involves moral turpitude (clause (c)).
  2. Analysis: the opinion on moral turpitude is the Central Government's.
  3. The hearing proviso covers only clauses (d) and (e). Clause (c) is not covered.
  4. Conclusion: the Act does not require a prior hearing for removal under clause (c).

Answer: Yes. The Central Government may remove him under Section 7(c), and the Act does not make a prior hearing mandatory for that ground.

Example 2

At a meeting of the Authority, four Members are present and voting. Two vote for a proposal and two against. One Member had disclosed in writing an interest in the matter and left the deliberation. How is the question decided?

Show the solution
  1. Provision: Section 8(4) bars a Member with an interest from taking part in deliberation or decision. His disclosure must be recorded.
  2. So he does not count among those voting. Assume the four present and voting are the other Members.
  3. Section 8(3): decisions are by majority of Members present and voting.
  4. With a 2-2 tie, the Chairperson has a casting vote. If the Chairperson is absent, the person presiding has it.
  5. Conclusion: the casting vote decides the matter.

Answer: The tie is resolved by the casting vote of the Chairperson, or of the person presiding in the Chairperson's absence. The interested Member takes no part, and the disclosure is recorded in the proceedings.

Exam tips

  • Learn the section-to-subject map. Questions often ask which section governs a situation.
  • Write numbers exactly: three years, 65, 62, three months, two years, six months.
  • In case questions, always name the type of Member, because the age limit and ex officio exceptions differ.
  • Add a compliance point where relevant, such as recording the disclosure or laying the notification before Parliament.
  • Keep the Section 12 duty in your own words and list the powers in order.

Practice questions from IFSCA Ecosystem and Regulatory Framework

Powers, Functions and Term of Members in other exams

The same ground in other exams, if you are preparing for more than one or want another angle on it.

Powers, Functions and Term of Members: frequently asked questions

What are the main functions of IFSCA under the IFSCA Act, 2019?

Its duty under Section 12 is to develop and regulate financial products, services and institutions in IFSCs. It regulates those already permitted before the Act and those notified by the Central Government. It also recommends new ones to the Central Government.

What is the term of office of IFSCA members?

The Chairperson and Members hold office for three years from entering office and can be re-appointed. No one can be Chairperson after 65 or a whole-time member after 62.

On what grounds can a Member of IFSCA be removed?

The Central Government may remove a Member who is insolvent, incapable, convicted of an offence involving moral turpitude, has a prejudicial interest, or has abused their position. A hearing is required for the last two grounds.

Can a former Member join a financial institution in an IFSC?

Not for two years after leaving office, unless the Central Government gives previous approval. The same applies to employment under the Central or a State Government. Ex officio Members are excluded.