BATF Service Providers in an IFSC must maintain minimum office accommodation measured by carpet area. Carpet area must be computed at 60 square feet for each employee, creating an employee-linked office-space compliance standard. The criterion applies to providers of book-keeping, accounting, taxation and financial crime compliance services and requires the prescribed minimum space within the IFSC as the minimum office-space threshold.

HON'BLE MR. P.A. AUGUSTIAN, MEMBER (JUDICIAL) AND HON'BLE MR. PULLELA NAGESWARA RAO, MEMBER (TECHNICAL) For the Appellant : Mr. M.S. Nagaraja, Advocate For the Respondent : Mr. P. Saravana Perumal ORDER Per: P.A. Augustian M/s Deccan Charters Limited, Bangalore, the Appellants, are operating Non-scheduled Air Transport Service under Non-Scheduled Operator's Permit No 26/2008 dated 07.10.2008 issued by the DGCA, Ministry of Civil Aviation. The Appellants have leased air... ... ...

BATF Service Providers must appoint IFSC-based Principal and Compliance Officers. The Principal Officer is responsible for overall IFSC activities, while the Compliance Officer reports to the Board of Directors or organisational head and oversees policies, procedures, record maintenance, and regulatory implementation. Both roles require prescribed professional qualifications or recognised degrees. Principal Officers require at least five years' relevant experience and Compliance Officers require at least three years. Principal Officers providing financial crime compliance services must also hold a relevant financial crime compliance qualification.

Service-recipient eligibility for BATF services requires the provider to ensure that each recipient is a non-resident. The provider must also ensure that the recipient is not from a jurisdiction identified in the Financial Action Task Force public statement as a high-risk jurisdiction subject to a call for action. These conditions restrict the permitted recipient base for book-keeping, accounting, taxation and financial crime compliance services.

Regulation 9 applies a safeguarding condition to BATF Service Providers: BATF Services must not be offered through the transfer or receipt of existing contracts or work arrangements from group entities in India. The scope of such transfers or receipts is determined in accordance with Part B of the First Schedule.

Regulation 8 requires an applicant to ensure that its IFSC business is not established by splitting up, reconstructing, or reorganising a business already in existence in India. The determination of whether an existing Indian business has been split up, reconstructed, or reorganised must follow the requirements in Part A of the First Schedule. The prohibition applies to each specified method of establishing the IFSC business.

Fit and proper requirements require a BATF Service Provider to ensure that the entity and its principal officer, directors, partners, designated partners, key managerial personnel and controlling shareholders maintain fairness, integrity, financial integrity, good reputation, character and honesty. Disqualifications include relevant criminal convictions, pending recovery proceedings, winding-up for malfeasance, undischarged insolvency, regulatory restraints or orders within stipulated periods, unsoundness of mind, financial unsoundness, wilful default, fugitive economic offender status, and other specified disqualifications.

Registration may be granted to a BATF Service Provider subject to specified conditions. If deficiencies prevent grant, the applicant must be informed and given thirty days to rectify them, with a reasonable opportunity to make written submissions before rejection. A certificate remains valid unless cancelled or surrendered, and surrender requires approval. The BATF Service Provider must report material changes in previously furnished information.

Registration for BATF Services requires an application for a certificate of registration in the prescribed format and manner, accompanied by the specified non-refundable fee. Incomplete applications are liable to rejection. Applicants must be established in an IFSC as a company or limited liability partnership, and their promoters must be from jurisdictions not identified in the Financial Action Task Force public statement as high-risk jurisdictions subject to a call for action.

BATF Services in an IFSC require a certificate of registration, except for an Ancillary Service Provider. An Ancillary Service Provider intending to provide such services must communicate its willingness to operate within sixty days of commencement, in the specified form and manner. Until it receives a letter of continuation, the provider must comply with the requirements under regulations 8 and 9.

BATF Services comprise book-keeping, accounting, taxation and financial crime compliance services within the IFSC regulatory framework. A BATF Service Provider is an entity registered to undertake any or all of those service categories. Book-keeping excludes payroll and taxation services, while accounting includes non-assurance financial statement work and related valuation support but excludes auditing. Taxation services include consultation, planning, return preparation and filing, and financial crime compliance services cover AML/CFT measures and FATF-related activities.

Regulation 2 establishes the objective of creating a regulatory framework for developing, registering and operating book-keeping, accounting, taxation and financial crime compliance services from International Financial Services Centres.

The International Financial Services Centres Authority (Book-keeping, Accounting, Taxation and Financial Crime Compliance Services) Regulations, 2024 are made under the International Financial Services Centres Authority Act, 2019. Regulation 1 prescribes their formal title and provides that they take effect on the date of publication in the Official Gazette.

From commencement, specified insurance regulatory instruments, together with circulars and guidelines issued under them, cease to apply in International Financial Services Centres. The non-applicability covers insurance business matters including capital, policyholder protection, outsourcing, disclosures, expenses, and commission. Prior actions under the displaced framework are preserved through deeming under corresponding provisions. Existing IIOs and IIIOs must meet additional requirements within three months, subject to an extended period specified by the Authority.

Registered persons who inadvertently filed a NIL refund claim may reapply for the same period, subject to prescribed conditions. A subsequent-period refund claim under the same category prevents reapplication only for specified unutilized input tax credit refund categories. Eligible persons must file under the "Any Other" category, submit required supporting documents, and, where required, debit the admissible amount from the electronic credit ledger through FORM GST DRC-03 before issuance of the refund and payment orders.

The Authority may issue guidance notes or circulars to clarify difficulties in applying or interpreting insurance business control and conduct requirements. On a fee-backed application, it may relax strict enforcement of any requirement where reasons are recorded in writing.

Regulation 21 authorises the Authority to specify norms, procedures, processes and modes of compliance for IIOs or IIIOs, as relevant, to implement the regulatory framework and incidental matters. These operational requirements apply to management control, administrative control and market conduct in the insurance business.

Every IIO must furnish information concerning regulatory requirements to the Authority or policyholders in the prescribed manner, at prescribed intervals and in prescribed forms. IIOs must follow fairness to policyholders, international best practices and transparency to strengthen trust in insurance mechanisms and promote insurance awareness and literacy.

Every IIO and IIIO must formulate a Board-approved policy safeguarding policyholders' interests. The policy must address insurance awareness, fulfilment of policyholder obligations, prevention of mis-selling and unfair practices, accurate product disclosures, service parameters, grievance redressal, complaint resolution, sale and service practices, and transparent claims settlement. Every IIO must publish and update Board-approved service parameters and turnaround times on its website, and submit the policy when directed.

IIOs and IIIOs must issue advertisements using fair, honest and transparent practices that preserve public confidence. Advertising communications must be relevant, fair, simple, truthful, accurate, capable of substantiation, and compliant with applicable advertising standards and Indian law. Each entity is responsible for the accuracy of advertisements issued on its behalf. An IIO must ensure that policies issued to policyholders conform to its advertisements.