Borrowing and leverage by Venture Capital Schemes are permitted only where the placement memorandum discloses the maximum leverage and calculation methodology. Leverage must comply with those disclosures, and any deviation requires consent of investors holding at least two-thirds in value. A Fund Management Entity proposing to employ leverage must maintain a comprehensive risk-management framework appropriate to the scheme's size, complexity and risk profile.

Venture Capital Scheme placement memoranda must disclose investment objectives, targeted investors, corpus, strategy, methodology, tenure, fees, expenses, risk-management practices, and relevant FME and scheme details. The FME must provide annual Net Asset Value and portfolio disclosures from the financial year investment activities commence, subject to the specified exclusion for certain investments. Portfolio disclosure is due within one month after each financial year ends. Material information identified by the FME or fiduciaries must be communicated immediately.

Venture Capital schemes are subject to corpus limits and must deploy at least 80 per cent of their corpus in eligible Investee Companies or qualifying schemes. Follow-on investment in older Investee Companies is permitted only under specified conditions, including consistency with the scheme's stated strategy, exclusion of certain investors from later rounds, and preservation of the scheme's fully diluted beneficial-interest level. Related-party investments and securities transactions generally require investor approval, subject to a disclosed fund of funds exception. Differential distribution rights through senior, junior or subordinate units must follow the applicable framework.

Venture Capital scheme investments are confined to specified securities, debt, money-market instruments, securitised debt, limited liability partnerships and other specified financial products or assets. Investments in units of other Venture Capital schemes, retail schemes, restricted schemes or alternative investment funds require placement memorandum disclosure. Pending deployment, monies may be placed in specified liquid investments. Contributor monies received before the first close must be invested only in permissible instruments that preserve capital and provide adequate liquidity, consistently with disclosed investment objectives and placement memorandum terms.

Venture Capital schemes must operate solely as close-ended schemes, with the amount proposed to be raised and a minimum three-year tenure disclosed in the placement memorandum. A scheme may be constituted as a company, limited liability partnership, or trust. Tenure extensions require investor approval, and extensions beyond two years require express consent from willing investors and an exit opportunity for dissenting investors.

Venture Capital Schemes are limited to fifty investors and permit investment by persons meeting the prescribed minimum threshold or by Accredited Investors. Employees, directors and designated partners of the Fund Management Entity may invest subject to a reduced threshold, while Accredited Investors are exempt from minimum investment requirements. Joint investors must each meet the applicable minimum contribution, with specified family relationships permitted to satisfy the general threshold on an aggregate basis. Registered Fund Management Entities may use restricted schemes to target more investors or accept lower application sizes.

Section 98(2) of the GST framework bars admission of an advance-ruling application where identical questions are already pending or decided in proceedings concerning the applicant. A show-cause notice and investigation addressing service classification, applicable tax treatment and input tax credit constitute parallel statutory proceedings. The bar may apply even where those proceedings arise after the application was filed, because a merits determination cannot continue once the same issues are under adjudication. Disclosure of such material developments is integral to assessing the application's maintainability.

A Fund Management Entity may launch Venture Capital schemes by private placement after filing a placement memorandum and the applicable fee. Green-channel filing permits investor subscriptions upon communication that the memorandum has been taken on record, which is treated as a Certificate of Registration for Income Tax Act purposes. The memorandum remains valid for twelve months, subject to successive six-month extensions where the minimum corpus is not achieved. Material changes must be immediately reported to the Authority.

Venture Capital Schemes must be filed with the Authority as a venture capital fund under the Category I Alternative Investment Fund framework. Such a filed scheme may be construed as a venture capital fund for purposes of the Income Tax Act, the Foreign Exchange Management Act, and related statutory instruments.

A Fund Management Entity may launch schemes but must appoint fiduciaries before filing the scheme document. The required fiduciaries are directors for a company, designated partners for a limited liability partnership, and trustees for a trust. Every fiduciary must meet fit and proper requirements. Appointment of a fiduciary for a retail scheme requires prior approval, and all fiduciaries must comply with the applicable Code of Conduct and obligations.

Surrender of registration permits a Fund Management Entity to apply to the Authority for voluntary surrender of its certificate of registration. The surrender becomes effective only when accepted by the Authority, and filing an application alone does not terminate registration.

Registration of a Fund Management Entity remains valid for the period specified by the Authority, unless earlier suspended, cancelled, or surrendered and taken on record by the Authority.

Registration applications for Fund Management Entities may be refused only after deficiencies are communicated and the applicant is allowed 30 days to rectify them. If the deficiencies are not rectified to the Authority's satisfaction within that period, the Authority may refuse registration and must communicate the refusal with reasons.

Registration of a Fund Management Entity is conditional on regulatory compliance by the entity and its relevant officers and personnel. The entity must promptly notify the Authority of material changes in previously provided information or particulars affecting its registration. A registered entity cannot change its registration category without prior approval from the Authority.

Grant of Certificate of Registration as a Fund Management Entity may be made by the Authority after receiving all required information and being satisfied that the applicant qualifies under the appropriate category. Grant is subject to payment of the applicable registration fee.

Furnishing of information for Fund Management Entity registration permits the Authority to seek further information or clarifications about the applicant, the fund, proposed fund management activities, or related matters when considering a registration application. The applicant may be required to appear for personal representation, and the Authority may inspect the applicant's office before granting a certificate of registration.

Infrastructure requirements for registration of a Fund Management Entity require adequate office space, equipment, communication facilities and manpower to effectively conduct activities in an IFSC. These facilities must be commensurate with the scale of its IFSC operations. The office must be dedicated and secured, and access must be restricted to authorised persons of the Fund Management Entity.

Registration of a Fund Management Entity requires the applicant and its principal officers, management personnel and controlling shareholders to remain fit and proper at all times. The standard requires fairness, integrity, financial integrity, reputation, character and honesty. Disqualifications include convictions or pending proceedings for specified offences, insolvency, wilful default, regulatory recovery action, market-access restrictions, malfeasance-related winding-up, fugitive economic offender status and other specified grounds. Persons declared not fit and proper remain ineligible for registration until they satisfy the prescribed criteria.

Entities seeking registration as Fund Management Entities must continuously maintain the net worth prescribed in the Second Schedule or any amount specified by the Authority. A branch operating in the IFSC may maintain the required minimum net worth at the parent-entity level, subject to the parent ensuring adequate funds for day-to-day branch operations. This minimum net worth is separate from, and additional to, net worth requirements applicable to other activities within or outside the IFSC.

Every Fund Management Entity must designate an IFSC-based principal officer responsible for overall fund management, risk management and compliance. Registered FMEs require a compliance officer, while retail FMEs and FMEs crossing the prescribed assets-under-management threshold require an additional fund-management KMP, subject to stated exceptions. Principal officers and KMPs must meet prescribed educational, professional, experience and certification requirements. Fund portfolio proposals must be initiated from the IFSC office, staffing must be proportionate to operations, and KMP appointments and changes must follow the prescribed manner.