Cabinet DecisionsLegislation Updates

The Union Cabinet approved for withdrawing of the International Financial Services Centres Authority, 2019 Bill which was introduced in the Rajya Sabha on 12thFebruary, 2019 and pending in the Rajya Sabha and introducing the International Financial Services Centres Authority Bill, 2019 in the Lok Sabha in the ensuing session of the Parliament.

Benefits

Currently, the banking, capital markets and insurance sectors in IFSC are regulated by multiple regulators i.e. RBI, SEBI and IRDAI. The dynamic nature of business in the IFSCs necessitates a high degree of inter-regulatory coordination.  It also requires clarifications and frequent amendments in the existing regulations governing financial activities in IFSCs.

The development of financial services and products in IFSCs would require focused and dedicated regulatory interventions.  Hence a need is felt for having a unified financial regulator for IFSCs in India to provide a world-class regulatory environment to financial market participants.

Further, this would also be essential from an ease of doing business perspective. The unified authority would also provide the much-needed impetus to further development of IFSC in India in-sync with the global best practices.

Background

The Union Cabinet in its meeting held on February 6, 2019, had approved the proposal for the establishment of a unified authority for regulating all financial services through the introduction of the International Financial Services Centres Authority Bill 2019 in the Parliament.  Subsequently, the International Financial Services Centres Authority Bill, 2019 was introduced in the Rajya Sabha on February 12, 2019, by the then Hon’ble Minister of State (Finance).

The Lok Sabha Secretariat has now conveyed that this is a Finance Bill under Article 117(1) of the Constitution and that it should be introduced in Lok Sabha accordingly with the recommendation of the President under Article 117(1) and 274(1) of the Constitution.


Ministry of Finance

[Press Release dt. 20-11-2019]

[Source: PIB]

Hot Off The PressNews

Supreme Court: The Centre told the 5-judge bench of Ranjan Gogoi, CJ and N V Ramana, D Y Chandrachud, Deepak Gupta and Sanjiv Khanna, JJ that Finance Bill of 2017 was certified as a Money Bill by the Speaker of the Lok Sabha and judicial review of that decision cannot be done.

Attorney General K K Venugopal told the Court that petitioners’ contention that certification of Finance Bill of 2017 as Money Bill was not right cannot be a ground for a challenge to the Bill. He said:

“The Act of 2017 deals with various aspects of finance. Speaker of the House gave the certification that Finance Act was a Money Bill. Finance Act of 2017 was passed by the Parliament as a Money Bill irrespective of the objections in Rajya Sabha.”

He added that “Certification of a particular Act as a Money Bill is an internal functions of the Parliament. If there is any dispute, the Speaker can applies his mind and takes a decision. No one can questions the bonafide of the Speaker and all members abide by the decision.”

Submitting that Supreme Court has repeatedly held in its verdicts that certification cannot be questioned and courts cannot inquire into the decision taken by Parliament, the AG said:

“This aspect is consistent with the broad parameters of separation of powers given in the Constitution. Similarly, Parliament cannot interfere with the affairs of judiciary.”

He also submitted that the Finance Bill comprises of amendments to several Acts and statutes and the petitioners have challenged only one particular aspect saying it cannot be termed as Money Bill.

“The certification of Money Bill is for the whole Finance Bill and saying that a part of the Bill does not qualify for the Money Bill cannot be held to be correct.”

On March 27, the Court had said:

“If we hold that it was not a money bill, then the matter rests there but if it is being held by the court that it was a money bill then subsequent issues which pertains to affairs of tribunal will be dealt,”

The Court clarified that it is not going to hear 20 lawyers on the same point repeatedly saying,

“this anarchy has to stop in the Supreme Court. Lawyers are arguing and arguing for 20 days on the same point”.

It asked the petitioners to discuss among themselves and sort it out as who will advance the arguments and if needed someone else can supplement on a particular point.

The Court will continue hearing the matter on April 2, 2019.

(Source: PTI)


Also read: Integrated Nodal Agency for all Tribunals: 5-judge SC bench seeks Centre’s view