Section 23 FEMA 1999: Terms and Conditions of Service of Special Director (Appeals)
Section 23 of the Foreign Exchange Management Act, 1999 deals with the salary, allowances and other terms and conditions of service of the Special Director (Appeals). The present provision is substantially different from the original 1999 text because Section 23 was substituted by the Finance Act, 2017.
Updated: 27 September 2026
Current text of Section 23 of FEMA
23. Terms and conditions of service of Special Director (Appeals).
The salary and allowances payable to and the other terms and conditions of service of the Special Director (Appeals) shall be such as may be prescribed.
The expression "prescribed" is important. Section 2 of FEMA provides definitions used in the Act, while the rule-making framework in Section 46 authorises the Central Government to make rules. In particular, Section 46(2)(e) addresses the salary, allowances and other terms and conditions of service under Section 23.
What Section 23 means
Section 23 does not itself fix a rupee amount of salary or list every service condition. Instead, Parliament has stated the subject matter in the Act and left the detailed service conditions to be prescribed under the Central Government's rule-making power.
In practical terms, the section identifies the office covered by the provision - the Special Director (Appeals) - and makes salary, allowances and other service conditions matters to be governed by the applicable prescribed framework.
Who is the Special Director (Appeals)?
The Special Director (Appeals) is an appellate authority within Chapter V of FEMA. Section 17 governs appeals to the Special Director (Appeals), and Section 21 now prescribes the qualifications for appointment to that office.
Section 23 was substituted by the Finance Act, 2017
With effect from 26 May 2017, Section 165 of the Finance Act, 2017 substituted Section 23. The current provision refers only to the Special Director (Appeals). This change formed part of a wider restructuring of tribunal-related provisions in FEMA.
Historical position: Before the 2017 substitution, Section 23 also referred to the Chairperson and other Members of the Appellate Tribunal and contained a proviso protecting the Chairperson or a Member against disadvantageous variation of salary, allowances or other service conditions after appointment.
That earlier wording should not be presented as the current text of Section 23.
| Position | Scope of Section 23 |
|---|---|
| Current law | Salary, allowances and other terms and conditions of service of the Special Director (Appeals), as prescribed. |
| Before 26 May 2017 | Applied to the Chairperson, other Members and the Special Director (Appeals), with an additional protection concerning disadvantageous variation for the Chairperson or a Member. |
Frequently asked questions
What does Section 23 of FEMA provide?
It provides that the salary, allowances and other terms and conditions of service of the Special Director (Appeals) shall be as prescribed.
Does Section 23 still apply to the Chairperson and Members of the old Appellate Tribunal structure?
No. The wording that referred to the Chairperson and other Members was replaced when Section 23 was substituted by the Finance Act, 2017 with effect from 26 May 2017.
Does Section 23 itself state the salary of the Special Director (Appeals)?
No. The section delegates the detailed prescription of salary, allowances and service conditions to the applicable rules made under FEMA.
This page is a general statutory reference. For a proceeding or legal opinion, check the latest Act, applicable rules, notifications and case law relevant to the facts.