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

The Central Government issues a notification under the IFSCA Act, 2019 setting up the International Financial Services Centres Authority. Which description of the legal character of the Authority is correct under the Act?

The Authority is a body corporate with perpetual succession and a common seal. It can make contracts, hold and dispose of movable and immovable property, and sue or be sued in its own name, so it has a separate legal identity.

  1. AA body corporate with perpetual succession and a common seal, able to sue and be sued in its own nameCorrect
  2. BA statutory committee of the Ministry of Finance with no separate legal existence
  3. CA registered company that must be incorporated under the Companies Act
  4. DA body that can hold only movable property and cannot enter into contracts

Explanation

Section 4(2) makes the Authority a body corporate with perpetual succession and a common seal. It can enter into contracts, acquire, hold and dispose of movable and immovable property, and sue and be sued by its name. The option limiting it to movable property is wrong because the Act expressly covers immovable property too.

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