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

IFSCA imposes a monetary penalty on a unit in an IFSC for a contravention. Which statement reflects the IFSCA Act, 2019 on collection and credit of the penalty?

Penalties are collected in the foreign currency equivalent, converted at the RBI-notified rate on the date of the order imposing the penalty. All sums realised by way of penalties or fines are credited to the Consolidated Fund of India in Indian rupees.

  1. AThe penalty is collected only in Indian rupees at a fixed rate and credited to the IFSCA Fund
  2. BThe penalty is collected in the foreign currency equivalent, using the RBI-notified rate on the date of the order, and the sums realised are credited to the Consolidated Fund of India in Indian rupeesCorrect
  3. CThe penalty is collected in foreign currency and retained by the Authority for its expenses
  4. DThe penalty is collected in the foreign currency equivalent, using the RBI rate on the date of payment, and credited to the IFSCA Fund

Explanation

Penalties, fines, fees and settlement amounts are collected in the foreign currency equivalent. The conversion uses the RBI-notified rate on the date of the order imposing the penalty. Sums realised as penalties or fines are credited to the Consolidated Fund of India in rupees, not to the Authority's Fund.

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