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CS Executive · Capital Market and Securities Laws · International Financial Services Centres Authority (IFSCA)

After IFSCA was constituted, a challenge was raised that an order it passed was invalid because one Member's seat on the Authority was vacant and a Member's appointment was later found to be defective. What is the legal position under the IFSCA Act, 2019?

The order remains valid. Under the Act, no act or proceeding of the Authority is invalid merely because of any vacancy or defect in its constitution or any defect in appointing a member, and no ratification by the Government is needed.

  1. AThe order stands, as no act or proceeding is invalid merely due to a vacancy or defect in constitution or in a member's appointmentCorrect
  2. BThe order is void because the Authority was not fully constituted
  3. CThe order is valid only if the Central Government ratifies it within thirty days
  4. DThe order is valid only if the defective Member did not vote

Explanation

Section 9 provides that no act or proceeding of the Authority is invalid merely because of a vacancy or defect in its constitution, or a defect in appointing a member. No ratification or non-voting condition is stated in the Act.

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