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

IFSCA imposes a penalty on a unit in an IFSC for a contravention. Under the IFSCA Act, 2019, how are the penalty collected and the sums realised dealt with?

Penalties are collected in the foreign currency equivalent, converted at the rate notified by the RBI on the date of the order imposing the penalty. All sums realised are credited to the Consolidated Fund of India in Indian rupees, not to the IFSCA Fund.

  1. ACollected in the foreign currency equivalent at the RBI-notified rate on the date of the order, and credited to the Consolidated Fund of India in rupeesCorrect
  2. BCollected only in rupees and credited to the IFSCA Fund
  3. CCollected in foreign currency at the rate on the date of the contravention, and kept by IFSCA as its income
  4. DCollected in foreign currency and credited to the Reserve Bank of India

Explanation

Section 13(5) requires collection in the foreign currency equivalent, using the RBI-notified rate on the date of the order imposing the penalty. Section 13(6) requires sums realised to be credited to the Consolidated Fund of India in Indian rupees. The IFSCA Fund holds grants, fees and charges, not penalties.

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