The governing body of the regional university also voted to relocate the Vice Chancellor's office from the USP's main campus in Suva, Fiji, to the its Alafua Campus in Apia, Samoa.
Professor Ahluwalia and his wife were forced to leave Fiji in early February after the government claimed the couple had breached provisions in their work permits.
It was the latest in a series of efforts to sideline Professor Ahluwalia following his allegations of serious mismanagement and abuse of office at the USP.
The council has now also voted to stipulate that the Canadian academic's contract as VC be a three-year term.
The five representatives of Fiji's government to the council attempted unsuccessfully to garner support to block the three motions.
However Islands Business reports that the strongest support Fiji's government received was when eight council members voted against a three-year term for Professor Ahluwalia's new contract as VC.
The additional three votes against the motion came from the representatives of Australia, New Zealand and the Council chair, Winston Thompson of Fiji.
Thompson and the Australian representative also voted with the Fiji bloc against the relocation of the VC's office to Samoa.
Having spearheaded the campaign to remove Professor Ahluwalia as VC, both Thompson and the chair of the Council's audit and risk sub-committee, Mahmood Khan, also of Fiji, have been cited for insubordination and of working against the interest of the Council and the USP.
Since Fiji authorities removed he and his wife form their Suva residence in the middle of the night and deported them, Professor Ahluwalia has been living in Nauru.