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SEBI ACT 1992

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SEBI ACT 1992

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Securities and Exchange Board of India [SEBI] is made for protecting the interests of investors in securities and to promote the development of, and to regulate the securities market and for matters connected therewith or incidental thereto.

The Securities and Exchange Board of India Act, 1992′ [SEBI ACT 1992], an Act of the Parliament of India enacted for regulation and development of securities market in India, was enacted on April 4th, 1992 by Parliament of India. SEBI ACT 1992 was amended in the years 1995, 1999 and 2002 to meet the requirements of changing needs of the securities market.

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CHAPTERS of SEBI ACT 1992:

Preliminary

Short title, extent and commencement.

1. (1) This Act may be called the Securities and Exchange Board of India Act, 1992.

(2) It extends to the whole of India.

(3) It shall be deemed to have come into force on the 30th day of January 1992.

Definitions.


2. (1) In this Act, unless the context otherwise requires,

(a) ―Board‖ means the Securities and Exchange Board of India established under section 3;

(b) ―Chairman‖ means the Chairman of the Board;

1[(ba) ―collective investment scheme‖ means any scheme or arrangement which satisfies the
conditions specified in section 11AA;]

(c) ―existing Securities and Exchange Board‖ means the Securities and Exchange Board of India constituted under the Resolution of the Government of India in the Department of Economic Affairs No. 1(44) SE/86, dated the 12th day of April 1988;

(d) ―Fund‖ means the Fund constituted under section 14;

2[(da) Insurance Regulatory and Development Authority‖ means the Insurance Regulatory and Development Authority of India established under sub-section (1) of section 3 of the Insurance Regulatory and Development Authority Act, 1999;]

3[(db) Judicial Member‖ means a Member of the Securities Appellate Tribunal appointed under sub-section (1) of section 15MA and includes the Presiding Officer;]

(e) ―member‖ means a member of the Board and includes the Chairman;

(f) ―notification‖ means a notification published in the Official Gazette;

4[(fa) Pension Fund Regulatory and Development Authority‖ means the Pension Fund Regulatory and Development Authority established under subsection (1) of section 3 of the Pension Fund Regulatory and Development Authority Act, 2013;]

(g) ―prescribed‖ means prescribed by rules made under this Act;

(h) ―regulations‖ means the regulations made by the Board under this Act;

5[(ha) ―Reserve Bank‖ means the Reserve Bank of India constituted under section 3 of the Reserve Bank of India Act, 1934 (2 of 1934);]

(i) ―securities‖ has the meaning assigned to it in section 2 of the Securities Contracts (Regulation) Act, 1956 (42 of 1956);

6[(j) Technical Member‖ means a Technical Member appointed under sub-section (1) of section 15MB.]

7[(2) Words and expressions used and not defined in this Act but defined in the Securities Contracts (Regulation) Act, 1956 (42 of 1956) 8[or the Depositories Act, 1996], shall have the meanings respectively assigned to them in that Act].

Establishment of the Securities and Exchange Board of India

Establishment and incorporation of Board:


1. (1) With effect from such date as the Central Government may, by notification, appoint, there shall be established, for the purposes of this Act, a Board by the name of the Securities and Exchange Board of India.

(2) The Board shall be a body corporate by the name aforesaid, having perpetual succession and a common seal, with power subject to the provisions of this Act, to acquire, hold and dispose of property, both movable and immovable, and to contract, and shall, by the said name, sue or be sued.

(3) The head office of the Board shall be at Bombay.

(4) The Board may establish offices at other places in India.

Management of the Board:


2. (1) The Board shall consist of the following members, namely:—

    (a) A Chairman.

    (b) two members from amongst the officials of the 9[Ministry] of the Central Government dealing with Finance 10[and administration of the Companies Act, 1956 (1 of 1956)].

    (c) one member from amongst the officials of 11[the Reserve Bank];

    12[(d)five other members of whom at least three shall be the whole-time members,] to be
    appointed by the Central Government.


(2) The general superintendence, direction and management of the affairs of the Board shall vest in a Board of members, which may exercise all powers and do all acts and things which may be exercised or done by the Board.

(3) Save as otherwise determined by regulations, the Chairman shall also have powers of general superintendence and direction of the affairs of the Board and may also exercise all powers and do all acts and things which may be exercised or done by that Board.

(4) The Chairman and members referred to in clauses (a) and (d) of sub-section (1) shall be appointed by the Central Government and the members referred to in clauses (b) and (c) of that sub-section shall be nominated by the Central Government and the 13[Reserve Bank] respectively.

(5) The Chairman and the other members referred to in clauses (a) and (d) of sub-section (1) shall be persons of ability, integrity and standing who have shown capacity in dealing with problems relating to securities market or have special knowledge or experience of law, finance, economics, accountancy, administration or in any other discipline which, in the opinion of the Central Government, shall be useful to the Board.

Term of office and conditions of service of Chairman and members of the Board:


3. (1) The term of office and other conditions of service of the Chairman and the members referred to in clause (d) of sub-section (1) of section 4 shall be such as may be prescribed.

(2) Notwithstanding anything contained in sub-section (1), the Central Government shall have the right to terminate the services of the Chairman or a member appointed under clause (d) of sub-section (1) of section 4, at any time before the expiry of the period prescribed under subsection (1), by giving him notice of not less than three months in writing or three months‘ salary and allowances in lieu thereof, and the Chairman or a member, as the case may be, shall also have the right to relinquish his office, at any time before the expiry of the period prescribed under sub-section (1), by giving to the Central Government notice of not less than three months in writing.

Removal of member from office:


4. 14[* * *] The Central Government shall remove a member from office if he—

    (a) is, or at any time has been, adjudicated as insolvent;

    (b) is of unsound mind and stands so declared by a competent court;

    (c) has been convicted of an offence which, in the opinion of the Central Government, involves a moral turpitude;

    (d) 15[* * *]

    (e) has, in the opinion of the Central Government, so abused his position as to render his continuation in office detrimental to the public interest :

    Provided that no member shall be removed under this clause unless he has been given a reasonable opportunity of being heard in the matter.


Meetings:


5. (1) The Board shall meet at such times and places, and shall observe such rules of procedure in regard to the transaction of business at its meetings (including quorum at such meetings) as may be provided by regulations.

(2) The Chairman or, if for any reason, he is unable to attend a meeting of the Board, any other member is chosen by the members present from amongst themselves at the meeting shall preside at the meeting.

(3) All questions which come up before any meeting of the Board shall be decided by a majority votes of the members present and voting, and, in the event of an equality of votes, the Chairman, or in his absence, the person presiding, shall have a second or casting vote.

16[Member not to participate in meetings in certain cases.
5A. Any member, who is a director of a company and who as such director has any direct or indirect pecuniary interest in any matter coming up for consideration at a meeting of the Board, shall, as soon as possible after relevant circumstances have come to his knowledge, disclose the nature of his interest at such meeting and such disclosure shall be recorded in the proceedings of the Board, and the member shall not take any part in any deliberation or decision of the Board with respect to that matter.]

Vacancies, etc., not to invalidate proceedings of Board:


6. No act or proceeding of the Board shall be invalid merely by reason of—

    (a) any vacancy in, or any defect in the constitution of, the Board; or

    (b) any defect in the appointment of a person acting as a member of the Board; or

    (c) any irregularity in the procedure of the Board not affecting the merits of the case.


Officers and employees of the Board:


7. (1) The Board may appoint such other officers and employees as it considers necessary for the efficient discharge of its functions under this Act.

(2) The term and other conditions of service of officers and employees of the Board appointed under sub-section (1) shall be such as may be determined by regulations.

Transfer of Assets, Liabilities, etc., of the Existing Securities and Exchange Board to the Board


1. (1) On and from the date of establishment of the Board,—

    (a) any reference to the existing Securities and Exchange Board in any law other than this Act or in any contract or other instruments shall be deemed as a reference to the Board.

    (b) all properties and assets, movable and immovable, of, or belonging to, the existing Securities and Exchange Board, shall vest in the Board.

    (c) all rights and liabilities of the existing Securities and Exchange Board shall be transferred to, and be the rights and liabilities of, the Board.

    (d) without prejudice to the provisions of clause (c), all debts, obligations and liabilities incurred, all contracts entered into and all matters and things engaged to be done by, with or for the existing Securities and Exchange Board immediately before that date, for or in connection with the purpose of the said existing Board shall be deemed to have been incurred, entered into, or engaged to be done by, with or for, the Board.

    (e) all sums of money due to the existing Securities and Exchange Board immediately before that date shall be deemed to be due to the Board.

    (f) all suits and other legal proceedings instituted or which could have been instituted by or against the existing Securities and Exchange Board immediately before that date may be continued or may be instituted by or against the Board; and

    (g) every employee holding any office under the existing Securities and Exchange Board immediately before that date shall hold his office in the Board by the same tenure and upon the same terms and conditions of service as respects remuneration, leave, provident fund, retirement and other terminal benefits as he would have held such office if the Board had not been established and shall continue to do so as an employee of the Board or until the expiry of the period of six months from that date if such employee opts not to be the employee of the Board within such period.


(2) Notwithstanding anything contained in the Industrial Disputes Act, 1947 (14 of 1947), or in any other law for the time being in force, absorption of any employee by the Board in its regular service under this section shall not entitle such employee to any compensation under that Act or other law and no such claim shall be entertained by any court, tribunal or other authority.


POWERS AND FUNCTIONS OF THE BOARD

Functions of Board

1.(1) Subject to the provisions of this Act, it shall be the duty of the Board to protect the interests of investors in securities and to promote the development of, and to regulate the securities market, by such measures as it thinks fit.

(2) Without prejudice to the generality of the foregoing provisions, the measures referred to therein may provide for—

    (a) regulating the business in stock exchanges and any other securities markets.

    (b) registering and regulating the working of stock brokers, sub-brokers, share transfer agents, bankers to an issue, trustees of trust deeds, registrars to an issue, merchant bankers, underwriters, portfolio managers, investment advisers and such other intermediaries who may be associated with securities markets in any manner.

    17[(ba) registering and regulating the working of the depositories, 18[participants], custodians of securities, foreign institutional investors, credit rating agencies and such other intermediaries as the Board may, by notification, specify in this behalf;]

    (c) registering and regulating the working of 19[venture capital funds and collective investment schemes], including mutual funds.

    (d) promoting and regulating self-regulatory organizations.

    (e) prohibiting fraudulent and unfair trade practices relating to securities markets.

    (f) promoting investors‘ education and training of intermediaries of securities markets.

    (g) prohibiting insider trading in securities.

    (h) regulating the substantial acquisition of shares and take over of companies.

    (i) calling for information from, undertaking inspection, conducting inquiries and audits of the 20[stock exchanges, mutual funds, other persons associated with the securities market], intermediaries and self-regulatory organizations in the securities market.

    21[(ia) calling for information and records from any person including any bank or any other authority or board or corporation established or constituted by or under any Central or State Act which, in the opinion of the Board, shall be relevant to any investigation or inquiry by the Board in respect of any transaction in securities;]

    22[(ib) calling for information from, or furnishing information to, other authorities, whether in India or outside India, having functions similar to those of the Board, in the matters relating to the prevention or detection of violations in respect of securities laws, subject to the provisions of other laws for the time being in force in this regard: Provided that the Board, for the purpose of furnishing any information to any authority outside India, may enter into an arrangement or agreement or understanding with such authority with the prior approval of the Central Government;]

    (j) performing such functions and exercising such powers under the provisions of 23[* * *] the Securities Contracts (Regulation) Act, 1956 (42 of 1956), as may be delegated to it by the Central Government;

    (k) levying fees or other charges for carrying out the purposes of this section.

    (l) conducting research for the above purposes.

    24[(la) calling from or furnishing to any such agencies, as may be specified by the Board, such information as may be considered necessary by it for the efficient discharge of its functions;]

    (m) performing such other functions as may be prescribed.


25[(2A) Without prejudice to the provisions contained in sub-section (2), the Board may take measures to undertake inspection of any book, or register, or other document or record of any listed public company or a public company (not being intermediaries referred to in section 12) which intends to get its securities listed on any recognised stock exchange where the Board has reasonable grounds to believe that such company has been indulging in insider trading or fraudulent and unfair trade practices relating to securities market.]

26[(3) Notwithstanding anything contained in any other law for the time being in force while exercising the powers under 27[clause (i) or clause (ia) of sub-section (2) or subsection (2A)], the The board shall have the same powers as are vested in a civil court under the Code of Civil The procedure, 1908 (5 of 1908), while trying a suit, in respect of the following matters, namely:—

    (i) the discovery and production of books of account and other documents, at such place
    and such time as may be specified by the Board.

    (ii) summoning and enforcing the attendance of persons and examining them on oath.

    (iii) inspection of any books, registers and other documents of any person referred to in section 12, at any place;]

    28[(iv) inspection of any book, or register, or other document or record of the company referred to in sub-section (2A).

    (v) issuing commissions for the examination of witnesses or documents.]


29[(4) Without prejudice to the provisions contained in sub-sections (1), (2), (2A) and (3) and section 11B, the Board may, by an order, for reasons to be recorded in writing, in the interests of investors or securities market, take any of the following measures, either pending investigation or inquiry or on completion of such investigation or inquiry, namely:—

    (a) suspend the trading of any security in a recognized stock exchange.

    (b) restrain persons from accessing the securities market and prohibit any person associated with the securities market to buy, sell or deal in securities.

    (c) suspend any office-bearer of any stock exchange or self-regulatory organization from holding such a position.

    (d) impound and retain the proceeds or securities in respect of any transaction which is under investigation.

    (e) attach, after passing of an order on an application made for approval by the Judicial Magistrate of the first class having jurisdiction, for a period not exceeding one month, one or more bank account or accounts of any intermediary or any person associated with the securities market in any manner involved in a violation of any of the provisions of this Act, or the rules or the regulations made thereunder : Provided that only the bank account or accounts or any transaction entered therein, so far as it relates to the proceeds actually involved in a violation of any of the provisions of this Act, or the rules or the regulations made thereunder shall be allowed to be attached.

    (f) direct any intermediary or any person associated with the securities market in any manner not to dispose of or alienate an asset forming part of any transaction which is under investigation.


Provided that the Board may, without prejudice to the provisions contained in sub-section (2) or sub-section (2A), take any of the measures specified in clause (d) or clause (e) or clause (f), in respect of any listed public company or a public company (not being intermediaries referred to in section 12) which intends to get its securities listed on any recognised stock exchange where the Board has reasonable grounds to believe that such company has been indulging in insider trading or fraudulent and unfair trade practices relating to securities market :

Provided further that the Board shall, either before or after passing such orders, give an opportunity of hearing to such intermediaries or persons concerned.]

30[(5) The amount disgorged, pursuant to a direction issued, under section 11B of this Act or section 12A of the Securities Contracts (Regulation) Act, 1956 or section 19 of the Depositories Act, 1996, as the case may be, shall be credited to the Investor Protection and Education Fund established by the Board and such amount shall be utilized by the Board in accordance with the regulations made under this Act.]

31[Board to regulate or prohibit the issue of the prospectus, offer document or advertisement soliciting money for the issue of securities.

1A.(1) Without prejudice to the provisions of the Companies Act, 1956 (1 of 1956), the Board
may, for the protection of investors,—

(a) specify, by regulations—

    (i) the matters relating to the issue of capital, transfer of securities and other matters incidental thereto. and

    (ii) the manner in which such matters shall be disclosed by the companies.


(b) by general or special orders—

    (i) prohibit any company from issuing prospectus, any offer document, or advertisement soliciting money from the public for the issue of securities.

    (ii) specify the conditions subject to which the prospectus, such offer document or
    advertisement, if not prohibited, may be issued.


(2) Without prejudice to the provisions of section 21 of the Securities Contracts (Regulation) Act, 1956 (42 of 1956), the Board may specify the requirements for listing and transfer of securities and other matters incidental thereto.]

32[Collective investment scheme.

1AA. (1) Any scheme or arrangement which satisfies the conditions referred to in sub-section (2) 33[or sub-section (2A)] shall be a collective investment scheme:


34[Provided that any pooling of funds under any scheme or arrangement, which is not registered with the Board or is not covered under sub-section (3), involving a corpus amount of one hundred crore rupees or more shall be deemed to be a collective investment scheme.]

(2) Any scheme or arrangement made or offered by any 35[person] under which,—

    (i) the contributions, or payments made by the investors, by whatever name called, are pooled and utilized for the purposes of the scheme or arrangement.

    (ii) the contributions or payments are made to such scheme or arrangement by the investors with a view to receive profits, income, produce or property, whether movable or immovable, from such scheme or arrangement.

    (iii) the property, contribution or investment forming part of scheme or arrangement, whether identifiable or not, is managed on behalf of the investors.

    (iv) the investors do not have day-to-day control over the management and operation of the scheme or arrangement.


36[(2A)] Any scheme or arrangement made or offered by any person satisfying the conditions as may be specified in accordance with the regulations made under this Act.]

(3) Notwithstanding anything contained in sub-section (2) 37[or sub-section (2A)], any scheme or
arrangement—


    (i) made or offered by a co-operative society registered under the Co-operative Societies Act, 1912 (2 of 1912) or a society being a society registered or deemed to be registered under any law relating to co-operative societies for the time being in force in any State.

    (ii) under which deposits are accepted by non-banking financial companies as defined in clause (f) of section 45-I of the Reserve Bank of India Act, 1934 (2 of 1934).

    (iii) being a contract of insurance to which the Insurance Act, 1938 (4 of 1938), applies.

    (iv) providing for any Scheme, Pension Scheme or the Insurance Scheme framed under the Employees Provident Fund and Miscellaneous Provisions Act, 1952 (19 of 1952).

    (v) under which deposits are accepted under section 58A of the Companies Act, 1956 (1 of 1956).

    (vi) under which deposits are accepted by a company declared as a Nidhi or a mutual benefit society under section 620A of the Companies Act, 1956 (1 of 1956).

    (vii) falling within the meaning of Chit business as defined in clause (d) of section 2 of the Chit Fund Act, 1982 (40 of 1982).

    (viii) under which contributions made are in the nature of subscription to a mutual fund;

    38[(ix) such other scheme or arrangement which the Central Government may, in consultation with the Board, notify,] shall not be a collective investment scheme.]


39[Power to issue directions.

1B. Save as otherwise provided in section 11, if after making or causing to be made an inquiry, the Board is satisfied that it is necessary,—

    (i) in the interest of investors, or orderly development of securities market; or

    (ii) to prevent the affairs of any intermediary or other persons referred to in section 12 being
    conducted in a manner detrimental to the interest of investors or securities market; or

    (iii) to secure the proper management of any such intermediary or person.


it may issue such directions,—

    (a) to any person or class of persons referred to in section 12, or associated with the securities market; or

    (b) to any company in respect of matters specified in section 11A, as may be appropriate in the interests of investors in securities and the securities market.]


40[Explanation.—For the removal of doubts, it is hereby declared that the power to issue directions under this section shall include and always be deemed to have been included the power to direct any person, who made profit or averted loss by indulging in any transaction or activity in contravention of the provisions of this Act or regulations made thereunder, to disgorge an amount equivalent to the wrongful gain made or loss averted by such
contravention.]

41[Investigation.

1C. (1) Where the Board has reasonable ground to believe that—

    (a) the transactions in securities are being dealt with in a manner detrimental to the investors or the securities market; or

    (b) any intermediary or any person associated with the securities market has violated any of the provisions of this Act or the rules or the regulations made or directions issued by the Board thereunder, it may, at any time by order in writing, direct any person (hereafter in this section referred to as the Investigating Authority) specified in the order to investigate the affairs of such intermediary or persons associated with the securities market and to report thereon to the Board.


(2) Without prejudice to the provisions of sections 235 to 241 of the Companies Act, 1956 (1 of 1956), it shall be the duty of every manager, managing director, officer and other employee of the company and every intermediary referred to in section 12 or every person associated with the securities market to preserve and to produce to the Investigating Authority or any person authorised by it in this behalf, all the books, registers, other documents and record of, or relating to, the company or, as the case may be, of or relating to, the intermediary or such person, which are in their custody or power.

(3) The Investigating Authority may require any intermediary or any person associated with securities market in any manner to furnish such information to, or produce such books, or registers, or other documents, or record before him or any person authorised by it in this behalf as it may consider necessary if the furnishing of such information or the production of such books, or registers, or other documents, or record is relevant or necessary for the purposes of its investigation.

(4) The Investigating Authority may keep in its custody any books, registers, other documents and record produced under sub-section (2) or sub-section (3) for six months and thereafter shall return the same to any intermediary or any person associated with securities market by whom or on whose behalf the books, registers, other documents, and record are produced :

Provided that the Investigating Authority may call for any book, register, other document and record if they are needed again :

Provided further that if the person on whose behalf the books, registers, other documents, and record are produced requires certified copies of the books, registers, other documents and record produced before the Investigating Authority, it shall give certified copies of such books. registers, other documents, and record to such person or on whose behalf the books, registers, other documents, and record were produced.

(5) Any person, directed to make an investigation under sub-section (1), may examine on oath, any manager, managing director, officer and other employee of any intermediary or any person associated with securities market in any manner, in relation to the affairs of his business and may administer an oath accordingly and for that purpose may require any of those persons to appear before it personally.

(6) If any person fails without reasonable cause or refuses—

    (a) to produce to the Investigating Authority or any person authorized by it in this behalf any book, register, other documents, and record which is his duty under sub-section (2) or sub-section (3) to produce; or

    (b) to furnish any information which is his duty under sub-section (3) to furnish; or

    (c) to appear before the Investigating Authority personally when required to do so under sub-section (5) or to answer any question which is put to him by the Investigating Authority in pursuance of that sub-section; or

    (d) to sign the notes of any examination referred to in sub-section (7), he shall be punishable with imprisonment for a term which may extend to one year, or with fine, which may extend to one crore rupees, or with both, and also with a further fine which may extend to five lakh rupees for every day after the first during which the failure or refusal continues.


(7) Notes of any examination under sub-section (5) shall be taken down in writing and shall be read over to, or by, and signed by, the person examined, and may thereafter be used in evidence against him.

(8) Where in the course of investigation, the Investigating Authority has reasonable ground to believe that the books, registers, other documents and record of, or relating to, any intermediary or any person associated with the securities market in any manner, may be destroyed, mutilated, altered, falsified or secreted, the Investigating Authority may make an application to 42[the Magistrate or Judge of such designated court in Mumbai, as may be notified by the Central Government] for an order for the seizure of such books, registers, other documents and record.

43[(8A) The authorized officer may requisition the services of any police officer or any officer of the Central Government, or of both, to assist him for all or any of the purposes specified in sub-
section (8) and it shall be the duty of every such officer to comply with such requisition.]


(9) After considering the application and hearing the Investigating Authority, if necessary, 44[the Magistrate or Judge of the Designated Court] may, by order, authorize the Investigating Authority –

    (a) to enter, with such assistance, as may be required, the place or places where such books, registers, other documents, and record are kept.

    (b) to search that place or those places in the manner specified in the order; and

    (c ) to seize books, registers, other documents, and record, it considers necessary for the purposes of the investigation:


Provided that 45[the Magistrate or Judge of the Designated Court] shall not authorise seizure of books, registers, other documents and record, of any listed public company or a public company (not being the intermediaries specified under section 12) which intends to get its securities listed on any recognised stock exchange unless such company indulges in insider trading or market manipulation.

(10) The Investigating Authority shall keep in its custody the books, registers, other documents and record seized under this section for such period not later than the conclusion of the investigation as it considers necessary and thereafter shall return the same to the company or the other body corporate, or, as the case may be, to the managing director or the manager or any other person, from whose custody or power they were seized and inform 46[the Magistrate or Judge of the Designated Court] of such return:

Provided that the Investigating Authority may, before returning such books, registers, other documents and record as aforesaid, place identification marks on them or any part thereof.

(11) Save as otherwise provided in this section, every search or seizure made under this section shall be carried out in accordance with the provisions of the Code of Criminal Procedure, 1973 (2 of 1974) relating to searches or seizures made under that Code.

Cease and desist proceedings.

1D. If the Board finds, after causing an inquiry to be made, that any person has violated, or is likely to violate, any provisions of this Act, or any rules or regulations made thereunder, it may pass an order requiring such person to cease and desist from committing or causing such violation:

Provided that the Board shall not pass such order in respect of any listed public company or a public company (other than the intermediaries specified under section 12) which intends to get its securities listed on any recognized stock exchange unless the Board has reasonable grounds to believe that such company has indulged in insider trading or market manipulation.]


REGISTRATION CERTIFICATE

Registration of stock brokers, sub-brokers, share transfer agents, etc.

1. (1) No stock broker, sub-broker, share transfer agent, banker to an issue, trustee of trust deed, registrar to an issue, merchant banker, underwriter, portfolio manager, investment adviser and such other intermediary who may be associated with securities market shall buy, sell or deal in securities except under, and in accordance with, the conditions of a certificate of registration obtained from the Board in accordance with the 47[regulations] made under this Act:

Provided that a person buying or selling securities or otherwise dealing with the securities market as a stockbroker, sub-broker, share transfer agent, banker to an issue, trustee of trust deed, registrar to an issue, merchant banker, underwriter, portfolio manager, investment adviser and such other intermediary who may be associated with securities market immediately before the establishment of the Board for which no registration certificate was necessary prior to such establishment, may continue to do so for a period of three months from such establishment or, if he has made an application for such registration within the said period of three months,
till the disposal of such application:

48[Provided further that any certificate of registration, obtained immediately before the commencement of the Securities Laws (Amendment) Act, 1995, shall be deemed to have been obtained from the Board in accordance with the regulations providing for such registration.

    (1A) No depository, 49[participant,] custodian of securities, foreign institutional investor, credit rating agency, or any other intermediary associated with the securities market as the Board may by notification in this behalf specify, shall buy or sell or deal in securities except under and in accordance with the conditions of a certificate of registration obtained from the Board in accordance with the regulations made under this Act:

    Provided that a person buying or selling securities or otherwise dealing with the securities market as a depository, 50[participant,] custodian of securities, foreign institutional investor or credit rating agency immediately before the commencement of the Securities Laws (Amendment) Act, 1995, for which no certificate of registration was required prior to such commencement, may continue to buy or sell securities or otherwise deal with the securities market until such time regulations are made under clause (d) of sub-section (2) of section 30.

    (1B) No person shall sponsor or cause to be sponsored or carry on or caused to be carried on any venture capital funds or collective investment schemes including mutual funds unless he obtains a certificate of registration from the Board in accordance with the regulations:

    Provided that any person sponsoring or causing to be sponsored, carrying or causing to be carried on any venture capital funds or collective investment schemes operating in the securities market immediately before the commencement of the Securities Laws (Amendment) Act, 1995, for which no certificate of registration was required prior to such commencement, may continue to operate till such time regulations are made under clause (d) of sub-section (2) of section 30.]

    51[Explanation- For the removal of doubts, it is hereby declared that, for purposes of this section, a collective investment scheme or mutual fund shall not include any unit-linked insurance policy or scrips or any such instrument or unit, by whatever name called, which provides a component of investment besides the component of insurance issued by an insurer.]


(2) Every application for registration shall be in such manner and on payment of such fees as may be determined by regulations.

(3) The Board may, by order, suspend or cancel a certificate of registration in such manner as may be determined by regulations:

Provided that no order under this subsection shall be made unless the person concerned has
been given a reasonable opportunity of being heard.

PROHIBITION OF MANIPULATIVE AND DECEPTIVE DEVICES, INSIDER TRADING AND SUBSTANTIAL ACQUISITION OF SECURITIES OR CONTROL

Prohibition of manipulative and deceptive devices, insider trading and substantial acquisition of securities or control.

1A. No person shall directly or indirectly—

    (a) use or employ, in connection with the issue, purchase or sale of any securities listed or proposed to be listed on a recognized stock exchange, any manipulative or deceptive device or contrivance in contravention of the provisions of this Act or the rules or the regulations made thereunder.

    (b) employ any device, scheme or artifice to defraud in connection with the issue or dealing in securities which are listed or proposed to be listed on a recognized stock exchange.

    (c) engage in any act, practice, course of business which operates or would operate as fraud or deceit upon any person, in connection with the issue, dealing in securities which are listed or proposed to be listed on a recognised stock exchange, in contravention of the provisions of this Act or the rules or the regulations made thereunder.

    (d) engage in insider trading.

    (e) deal in securities while in possession of material or non-public information or communicate such material or non-public information to any other person, in a manner which is in contravention of the provisions of this Act or the rules or the regulations made thereunder.

    (f) acquire control of any company or securities more than the percentage of the equity share capital of a company whose securities are listed or proposed to be listed on a recognized stock exchange in contravention of the regulations made under this Act.]

FINANCE, ACCOUNTS AND AUDIT

Grants by the Central Government:
1. The Central Government may, after due appropriation made by Parliament by law in this behalf, make to the Board grants of such sums of money as that Government may think fit for being utilized for the purposes of this Act.

Fund.

2. (1) There shall be constituted a Fund to be called the Securities and Exchange Board of India General Fund and there shall be credited thereto—

    (a) all grants, fees, and charges received by the Board under this Act; 53 [* * *]

    (aa) 54[* * *]

    (b) all sums received by the Board from such other sources as may be decided upon by the Central Government.


(2) The Fund shall be applied for meeting—

    (a) the salaries, allowances and other remuneration of the members, officers and other employees of the Board;

    (b) the expenses of the Board in the discharge of its functions under section 11;

    (c) the expenses on objects and for purposes authorized by this Act.


Accounts and audit.

3. (1) The Board shall maintain proper accounts and other relevant records and prepare an annual statement of accounts in such form as may be prescribed by the Central Government in consultation with the Comptroller and Auditor-General of India.

(2) The accounts of the Board shall be audited by the Comptroller and Auditor-General of India at such intervals as may be specified by him and any expenditure incurred in connection with such audit shall be payable by the Board to the Comptroller and Auditor-General of India.

(3) The Comptroller and Auditor-General of India and any other person appointed by him in connection with the audit of the accounts of the Board shall have the same rights and privileges and authority in connection with such audit as the Comptroller and Auditor-General generally has in connection with the audit of the Government accounts and, in particular, shall have the right to demand the production of books, accounts, connected vouchers and other documents and papers and to inspect any of the offices of the Board.

(4) The accounts of the Board as certified by the Comptroller and Auditor-General of India or any other person appointed by him in this behalf together with the audit report thereon shall be forwarded annually to the Central Government and that Government shall cause the same to be laid before each House of Parliament.

PENALTIES AND ADJUDICATION

The penalty for failure to furnish information, return, etc.

3A. If any person, who is required under this Act or any rules or regulations made
thereunder,—

    (a) to furnish any document, return or report to the Board, fails to furnish the same, he shall be liable to 56[a penalty 57[which shall not be less than one lakh rupees but which may extend to one lakh rupees for each day during which such failure continues subject to a maximum of one crore rupees]];

    (b) to file any return or furnish any information, books or other documents within the time specified therefor in the regulations, fails to file return or furnish the same within the time specified therefor in the regulations, he shall be liable to 58[a penalty 59[which shall not be less than one lakh rupees but which may extend to one lakh rupees for each day during which such failure continues subject to a maximum of one crore rupees]];

    (c) to maintain books of account or records, fails to maintain the same, he shall be liable to 60[a penalty 61[which shall not be less than one lakh rupees but which may extend to one lakh rupees for each day during which such failure continues subject to a maximum of one crore rupees]].


Penalty for failure by any person to enter into an agreement with clients.

3B. If any person, who is registered as an intermediary and is required under this Act or any rules or regulations made thereunder to enter into an agreement with his client, fails to enter into such agreement, he shall be liable to 62[a penalty 63[which shall not be less than one lakh rupees but which may extend to one lakh rupees for each day during which such failure continues subject to a maximum of one crore rupees]].

64[Penalty for failure to redress investors’ grievances.

3C. If any listed company or any person who is registered as an intermediary, after having been called upon by the Board in writing, to redress the grievances of investors, fail to redress such grievances within the time specified by the Board, such company or intermediary shall be liable to a penalty 65[which shall not be less than one lakh rupees but which may extend to one lakh rupees for each day during which such failure continues subject to a maximum of one crore rupees].

The penalty for certain defaults in case of mutual funds.

3D.If any person, who is—

    (a) required under this Act or any rules or regulations made thereunder to obtain a certificate of registration from the Board for sponsoring or carrying on any collective investment scheme, including mutual funds, sponsors or carries on any collective investment scheme, including mutual funds, without obtaining such certificate of registration, he shall be liable to 66[a penalty 67[which shall not be less than one lakh rupees but which may extend to one lakh rupees for each day during which he sponsors or carries on any such collective investment scheme including mutual funds subject to a maximum of one crore rupees]];

    (b) registered with the Board as a collective investment scheme, including mutual funds, for sponsoring or carrying on any investment scheme, fails to comply with the terms and conditions of the certificate of registration, he shall be liable to 68[a penalty 69[which shall not be less than one lakh rupees but which may extend to one lakh rupees for each day during which such failure continues subject to a maximum of one crore rupees]];

    (c) registered with the Board as a collective investment scheme, including mutual funds, fails to make an application for listing of its schemes as provided for in the regulations governing such listing, he shall be liable to 70[a penalty 71[which shall not be less than one lakh rupees but which may extend to one lakh rupees for each day during which such failure continues subject to a maximum of one crore rupees]].

    (d) registered as a collective investment scheme, including mutual funds, fails to despatch unit certificates of any scheme in the manner provided in the regulation governing such despatch, he shall be liable to 72[a penalty 73[which shall not be less than one lakh rupees but which may extend to one lakh rupees for each day during which such failure continues subject to a maximum of one crore rupees]].

    (e) registered as a collective investment scheme, including mutual funds, fails to refund the application monies paid by the investors within the period specified in the regulations, he shall be liable to 74[a penalty 75[which shall not be less than one lakh rupees but which may extend to one lakh rupees for each day during which such failure continues subject to a maximum of one crore rupees]].

    (f) registered as a collective investment scheme, including mutual funds, fails to invest money collected by such collective investment schemes in the manner or within the period specified in the regulations, he shall be liable to 76[a penalty 77[which shall not be less than one lakh rupees but which may extend to one lakh rupees for each day during which such failure continues subject to a maximum of one crore rupees]].


The penalty for failure to observe rules and regulations by an asset management company.

3E. Where any asset management company of a mutual fund registered under this Act, fails to comply with any of the regulations providing for restrictions on the activities of the asset management companies, such asset management company shall be liable to 78[a penalty 79[which shall not be less than one lakh rupees but which may extend to one lakh rupees for each day during which such failure continues subject to a maximum of one crore rupees]].

CA penalty for default in case of stockbrokers.

3F. If any person, who is registered as a stockbroker under this Act,—

    (a) fails to issue contract notes in the form and manner specified by the stock exchange of which such a broker is a member, he shall be liable to 80[a penalty which shall not be less than one lakh rupees but which may extend to] for which the contract note was required to be issued by that broker.

    (b) fails to deliver any security or fails to make payment of the amount due to the investor in the manner within the period specified in the regulations, he shall be liable to 81[a penalty 82[which shall not be less than one lakh rupees but which may extend to one lakh rupees for each day during which he sponsors or carries on any such collective investment scheme including mutual funds subject to a maximum of one crore rupees]].
    (c) charges an amount of brokerage which is in excess of the brokerage specified in the regulations, he shall be liable to 83[a penalty 84[which shall not be less than one lakh rupees but which may extend to five times the amount of brokerage]] charged in excess of the specified brokerage, whichever is higher.


the penalty for insider trading.

3G.If any insider who,—

    (i) either on his own behalf or on behalf of any other person, deals in securities of a body corporate listed on any stock exchange on the basis of any unpublished price-sensitive information; or

    (ii) communicates any unpublished price-sensitive information to any person, with or without his request for such information except as required in the ordinary course of business or under any law; or

    (iii) counsels, or procures for any other person to deal in any securities of any body corporate on the basis of unpublished price-sensitive information, shall be liable to a penalty 85[which shall not be less than ten lakh rupees but which may extend to twenty-five crore rupees or three times the amount of profits made out of insider trading, whichever is higher].


The penalty for non-disclosure of acquisition of shares and takeovers.

3H.If any person, who is required under this Act or any rules or regulations made thereunder, fails to,—

    (i) disclose the aggregate of his shareholding in the body corporate before he acquires any shares of that body corporate; or

    (ii) make a public announcement to acquire shares at a minimum price; or

    86[(iii) make a public offer by sending a letter of offer to the shareholders of the concerned company; or

    (iv) make payment of consideration to the shareholders who sold their shares pursuant to a letter of offer,]

    he shall be liable to a penalty 87[which shall not be less than ten lakh rupees but which may extend to twenty-five crore rupees or three times the amount of profits made out of such failure, whichever is higher]


88[Penalty for fraudulent and unfair trade practices.

3HA. If any person indulges in fraudulent and unfair trade practices relating to securities, he shall be liable to a penalty 89[which shall not be less than five lakh rupees but which may extend to twenty-five crore rupees or three times the amount of profits made out of such practices, whichever is higher].


The penalty for contravention where no separate penalty has been provided.

3HB. Whoever fails to comply with any provision of this Act, the rules or the regulations made or directions issued by the Board thereunder for which no separate penalty has been provided, shall be 90[liable to a penalty which shall not be less than one lakh rupees but which may extend to one crore rupees.]

Power to adjudicate.

3-I.

    (1) For the purpose of adjudging under sections 3A, 3B, 3C, 3D, 3E, 3F, 3G 91[,3H,3HA and 3HB], the Board shall appoint any officer not below the rank of a Division Chief to be an adjudicating officer for holding an inquiry in the prescribed manner after giving any a person concerned a reasonable opportunity of being heard for the purpose of imposing any penalty.

    (2) While holding an inquiry the adjudicating officer shall have power to summon and enforce the attendance of any person acquainted with the facts and circumstances of the case to give evidence or to produce any document which in the opinion of the adjudicating officer, may be useful for or relevant to the subject-matter of the inquiry and if, on such inquiry, he is satisfied that the person has failed to comply with the provisions of any of the sections specified in subsection (1), he may impose such penalty as he thinks fit in accordance with the provisions of any of those sections.

    92[(3) The Board may call for and examine the record of any proceedings under this section and if it considers that the order passed by the adjudicating officer is erroneous to the extent it is not in the interests of the securities market, it may, after making or causing to be made such inquiry as it deems necessary, pass an order enhancing the quantum of penalty, if the circumstances of the case so justify:
    Provided that no such order shall be passed unless the person concerned has been given an opportunity of being heard in the matter:

    Provided further that nothing contained in this subsection shall be applicable after an expiry of a period of three months from the date of the order passed by the adjudicating officer or disposal of the appeal under section 3T, whichever is earlier.]


Factors to be taken into account by the adjudicating officer.

3J. While adjudging quantum of penalty under section 3-I, the adjudicating officer shall have due regard to the following factors, namely:—

    (a) the amount of disproportionate gain or unfair advantage, wherever quantifiable, made as a result of the default;

    (b) the amount of loss caused to an investor or group of investors as a result of the default;

    (c) the repetitive nature of the default.
    93[ Explanation.—For the removal of doubts, it is clarified that the power of an adjudicating officer to adjudge the quantum of penalty under sections 3A to 3E, clauses (b) and (c) of section 3F, 3G, 3H and 3HA shall be and shall always be deemed to have been exercised under the provisions of this section.] 94[Crediting sums realized by way of penalties to Consolidated Fund of India.


3JA. All sums realized by way of penalties under this Act shall be credited to the Consolidated
Fund of India.]

95[Settlement of administrative and civil proceedings.

[3JB. (1) Notwithstanding anything contained in any other law for the time being in force, any person, against whom any proceedings have been initiated or may be initiated under section 11, section 11B, section 11D, sub-section (3) of section 12 or section 3-I, may file an application in writing to the Board proposing for settlement of the proceedings initiated or to be initiated for the alleged defaults.

(2) The Board may, after taking into consideration the nature, gravity and impact of defaults, agree to the proposal for settlement, on payment of such sum by the defaulter or on such other terms as may be determined by the Board in accordance with the regulations made under this Act.

(3) The settlement proceedings under this section shall be conducted in accordance with the procedure specified in the regulations made under this Act.

(4) No appeal shall lie under section 3T against any order passed by the Board or adjudicating officer, as the case may be, under this section.]

ESTABLISHMENT, JURISDICTION, AUTHORITY AND PROCEDURE OF 96[SECURITIES] APPELLATE TRIBUNAL

Establishment of Securities Appellate Tribunals.

97[3K. (1) The Central Government shall, by notification, establish a Tribunal to be known as the Securities Appellate Tribunal to exercise the jurisdiction, powers, and authority conferred on it by or under this Act or any other law for the time being in force.

(2) The Central Government shall also specify in the notification referred to in sub-section (1), the matters and places in relation to which the Securities Appellate Tribunal may exercise jurisdiction.]

98[Composition of Securities Appellate Tribunal.

3L. (1) The Securities Appellate Tribunal shall consist of a Presiding Officer and such number of Judicial Members and Technical Members as the Central Government may determine, by notification, to exercise the powers and discharge the functions conferred on the Securities Appellate Tribunal under this Act or any other law for the time being in force.

(2) Subject to the provisions of this Act,—

    (a) the jurisdiction of the Securities Appellate Tribunal may be exercised by Benches thereof;

    (b) a Bench may be constituted by the Presiding Officer of the Securities Appellate Tribunal with two or more Judicial or Technical Members as he may deem fit:

    Provided that every Bench constituted shall include at least one Judicial Member and one Technical Member;

    (c) the Benches of the Securities Appellate Tribunal shall ordinarily sit at Mumbai and may also sit at such other places as the Central Government may, in consultation with the Presiding Officer, notify.


(3) Notwithstanding anything contained in sub-section (2), the Presiding Officer may transfer a Judicial Member or a Technical Member of the Securities Appellate Tribunal from one Bench to another Bench.]

Qualification for appointment as Presiding Officer or Member of Securities Appellate Tribunal.

3M. 99[ A person shall not be qualified for appointment as the Presiding Officer or a Judicial Member or a Technical Member of the Securities Appellate Tribunal unless he—

    (a) is, or has been, a Judge of the Supreme Court or a Chief Justice of a High Court or a Judge of High Court for at least seven years, in the case of the Presiding Officer; and

    (b) is, or has been, a Judge of High Court for at least five years, in the case of a Judicial Member;
    or

    (c) in the case of a Technical Member––


    (i) is, or has been, a Secretary or an Additional Secretary in the Ministry or Department of the Central Government or any equivalent post in the Central Government or a State Government; or

    (ii) is a person of proven ability, integrity and standing to have special knowledge and professional experience, of not less than fifteen years, in the financial sector including securities market or pension funds or commodity derivatives or insurance.]

    100[3MA. The Presiding Officer and Judicial Members of the Securities Appellate Tribunal shall be appointed by the Central Government in consultation with the Chief Justice of India or his nominee.


3MB. (1) The Technical Members of the Securities Appellate Tribunal shall be appointed by the
Central Government on the recommendation of a Search-cum-Selection Committee consisting of the following, namely:––

    (a) Presiding Officer, Securities Appellate Tribunal—Chairperson;

    (b) Secretary, Department of Economic Affairs—Member;

    (c) Secretary, Department of Financial Services—Member; and

    (d) Secretary, Legislative Department or Secretary, Department of Legal Affairs—Member.


(2) The Secretary, Department of Economic Affairs shall be the Convener of the Search-cum-Selection Committee.


(3) The Search-cum-Selection Committee shall determine its procedure for recommending the names of persons to be appointed under sub-section (1).

3MC. (1) No appointment of the Presiding Officer, a Judicial Member or a Technical Member of the Securities Appellate Tribunal shall be invalid merely by reason of any vacancy or any a defect in the constitution of the Search cum- Selection Committee.

(2) A member or part-time member of the Board or the Insurance Regulatory and Development Authority or the Pension Fund Regulatory and Development Authority, or any person at senior management level equivalent to the Executive Director in the Board or in such Authorities, shall not be appointed as Presiding Officer or Member of the Securities Appellate Tribunal, during his service or tenure as such with the Board or with such Authorities, as the case may be, or within two years from the date on which he ceases to hold office as such in the Board or in such Authorities.

(3) The Presiding Officer or such other member of the Securities Appellate Tribunal, holding office on the date of commencement of Part VIII of Chapter VI of the Finance Act, 2017 shall continue to hold office for such term as he was appointed and the other provisions of this Act shall apply to such Presiding Officer or such other member, as if Part VIII of Chapter VI of the Finance Act, 2017 had not been enacted.]

101[Tenure of office of Presiding Officer and other Members of Securities Appellate Tribunal.

3N. The Presiding Officer or every Judicial or Technical Member of the Securities Appellate
Tribunal shall hold office for a term of five years from the date on which he enters upon his office, and shall be eligible for reappointment for another term of maximum five years: Provided that no Presiding Officer or the Judicial or Technical Member shall hold office after he has attained the age of seventy years.]

Salary and allowances and other terms and conditions of service of Presiding Officers.

3-O. The salary and allowances payable to and the other terms and conditions of service including pension, gratuity and other retirement benefits of the 102[Presiding Officer and other Members] of a Securities Appellate Tribunal shall be such as may be prescribed:
Provided that neither the salary and allowances nor the other terms and conditions of service of the 103[Presiding Officer and other Members of a Securities Appellate Tribunal] shall be varied to their disadvantage after appointment. Filling up of vacancies.

3P. If, for reason other than temporary absence, any vacancy occurs in the 104[office of the
Presiding Officer or any other Member] of a Securities Appellate Tribunal, then the Central Government shall appoint another person in accordance with the provisions of this Act to fill the vacancy and the proceedings may be continued before the Securities Appellate Tribunal from the stage at which the vacancy is filled.

105[3PA. In the event of occurrence of any vacancy in the office of the Presiding Officer of the Securities Appellate Tribunal by reason of his death, resignation or otherwise, the senior-most Judicial Member of the Securities Appellate Tribunal shall act as the Presiding Officer until the date on which a new Presiding Officer is appointed in accordance with the provisions of this Act.]

Resignation and removal.

3Q.(1) The 106[Presiding Officer or any other Member] of a Securities Appellate Tribunal may, by notice in writing under his hand addressed to the Central Government, resign his office:

Provided that 107[the Presiding Officer or any other Member] shall, unless he is permitted by the Central Government to relinquish his office sooner, continue to hold office, until the expiry of three months from the date of receipt of such notice or until a person duly appointed as his successor enters upon his office or until the expiry of his term of office, whichever is the earliest.

(2) 108[ The Central Government may, after an inquiry made by the Judge of the Supreme Court, remove the Presiding Officer or Judicial Member or Technical Member of the Securities Appellate Tribunal, if he—


    (a) is, or at any time has been adjudged as an insolvent;

    (b) has become physically or mentally incapable of acting as the Presiding Officer, Judicial or Technical Member;

    (c) has been convicted of any offense which, in the opinion of the Central Government, involves moral turpitude;

    (d) has, in the opinion of the Central Government, so abused his position as to render his continuation in office detrimental to the public interest; or

    (e) has acquired such financial interest or other interest as is likely to affect prejudicially his functions as the Presiding Officer or Judicial or Technical Member: Provided that he shall not be removed from office under clauses (d) and (e), unless he has been given a reasonable opportunity of being heard in the matter.]


(3) The Central Government may, by rules, regulate the procedure for the investigation of misbehavior or incapacity of the 109[Presiding Officer or any other Member].

110[3QA. Notwithstanding anything contained in this Act, the qualifications, appointment, term of office, salaries and allowances, resignation, removal and the other terms and conditions of service of the Presiding Officer and other Members of the Appellate Tribunal appointed after the commencement of Part XIV of Chapter VI of the Finance Act, 2017, shall be governed by the provisions of section 184 of that Act:


Provided that the Presiding Officer and Member appointed before the commencement of Part XIV of Chapter VI of the Finance Act, 2017, shall continue to be governed by the provisions of this Act and the rules made thereunder as if the provisions of section 184 of the Finance Act, 2017 had not come into force.]

Orders constituting Appellate Tribunal to be final and not to invalidate its proceedings.

3R. No order of the Central Government appointing any person as the 111[Presiding Officer or a Member] of a Securities Appellate Tribunal shall be called in question in any manner, and no act or proceeding before a Securities Appellate Tribunal shall be called in question in any manner on the ground merely of any defect in the constitution of a Securities Appellate Tribunal.

Staff of the Securities Appellate Tribunal.

3S. (1) The Central Government shall provide the Securities Appellate Tribunal with such
officers and employees as that Government may think fit.

(2) The officers and employees of the Securities Appellate Tribunal shall discharge their functions under the general superintendence of the Presiding Officer.


(3) The salaries and allowances and other conditions of service of the officers and employees of the Securities Appellate Tribunal shall be such as may be prescribed. Appeal to the Securities Appellate Tribunal.

3T. 112[(1) Save as provided in sub-section
(2), any person aggrieved,—

    (a) by an order of the Board made, on and after the commencement of the Securities Laws (Second Amendment) Act, 1999, under this Act, or the rules or regulations made thereunder; or

    (b) by an order made by an adjudicating officer under this Act113[; or], 114[―(c) by an order of the Insurance Regulatory and Development Authority or the Pension Fund Regulatory and Development Authority,]
    may prefer an appeal to a Securities Appellate Tribunal having jurisdiction in the matter.

    115[(2) ********]


(3) Every appeal under sub-section (1) shall be filed within a period of forty-five days from the date on which a copy of the order made by the 116[Board or the Adjudicating Officer 117[or the Insurance Regulatory and Development Authority or the Pension Fund Regulatory and Development Authority], as the case, maybe,] is received by him and it shall be in such form and be accompanied by such fee as may be prescribed :

Provided that the Securities Appellate Tribunal may entertain an appeal after the expiry of the said period of forty-five days if it is satisfied that there was sufficient cause for not filing it within that period.

(4) On receipt of an appeal under sub-section (1), the Securities Appellate Tribunal may, after giving the parties to the appeal, an opportunity of being heard, pass such orders thereon as it thinks fit, confirming, modifying or setting aside the order appealed against.

(5) The Securities Appellate Tribunal shall send a copy of every order made by it to the 118[Board, 119[or the Insurance Regulatory and Development Authority or the Pension Fund Regulatory and Development Authority, as the case may be] the] parties to the appeal and to the concerned Adjudicating Officer.

(6) The appeal filed before the Securities Appellate Tribunal under sub-section (1) shall be dealt with by it as expeditiously as possible and endeavor shall be made by it to dispose of the appeal finally within six months from the date of receipt of the appeal.


Procedure and powers of the Securities Appellate Tribunal.

3U.(1) The Securities Appellate Tribunal shall not be bound by the procedure laid down by the Code of Civil Procedure, 1908 (5 of 1908), but shall be guided by the principles of natural justice and, subject to the other provisions of this Act, and of any rules, the Securities Appellate Tribunal shall have powers to regulate their own procedure including the places at which they shall have their settings.

(2) The Securities Appellate Tribunal shall have, for the purposes of discharging their functions under this Act, the same powers as are vested in a civil court under the Code of Civil Procedure, 1908 (5 of 1908), while trying a suit, in respect of the following matters, namely :—

    (a) summoning and enforcing the attendance of any person and examining him on oath;

    (b) requiring the discovery and production of documents;

    (c) receiving evidence on affidavits;

    (d) issuing commissions for the examination of witnesses or documents;

    (e) reviewing its decisions;

    (f) dismissing an application for default or deciding it ex parte ;

    (g) setting aside any order of dismissal of any application for default or any order passed by it ex parte ;

    (h) any other matter which may be prescribed.


(3) Every proceeding before the Securities Appellate Tribunal shall be deemed to be a judicial proceeding within the meaning of sections 193 and 228, and for the purposes of section 196 of the Indian Penal Code (45 of 1860), and the Securities Appellate Tribunal shall be deemed to be a civil court for all the purposes of section 195 and Chapter XXVI of the Code of Criminal Procedure, 1973 (2 of 1974).

120[(4) Where Benches are constituted, the Presiding Officer of the Securities Appellate Tribunal may, from time to time make provisions as to the distribution of the business of the Securities Appellate Tribunal amongst the Benches and also provide for the matters which may be dealt with, by each Bench.

(5) On the application of any of the parties and after notice to the parties, and after hearing such of them as he may desire to be heard, or on his own motion without such notice, the Presiding Officer of the Securities Appellate Tribunal may transfer any case pending before one Bench, for disposal, to any other Bench.

(6) If a Bench of the Securities Appellate Tribunal consisting of two members differ in opinion on any point, they shall state the point or points on which they differ, and make a reference to the Presiding Officer of the Securities Appellate Tribunal who shall either hear the point or points himself or refer the case for hearing only on such point or points by one or more of the other members of the Securities Appellate Tribunal and such point or points shall be decided according to the opinion of the majority of the members of the Securities Appellate Tribunal who have heard the case, including those who first heard it.]


121[Right to legal representation.

3V.The appellant may either appear in person or authorize one or more chartered accountants
or company secretaries or cost accountants or legal practitioners or any of its officers to present his or its case before the Securities Appellate Tribunal.

Explanation.—For the purposes of this section,—


    (a) ―chartered accountant‖ means a chartered accountant as defined in clause (b) of sub-section (1) of section 2 of the Chartered Accountants Act, 1949 (38 of 1949) and who has obtained a certificate of practice under sub-section (1) of section 6 of that Act;

    (b) ―company secretary‖ means a company secretary as defined in clause (c) of sub-section (1) of section 2 of the Company Secretaries Act, 1980 (56 of 1980) and who has obtained a certificate of practice under sub-section (1) of section 6 of that Act;

    (c) ―cost accountant‖ means a cost accountant as defined in clause (b) of sub-section (1) of section 2 of the Cost and Works Accountants Act, 1959 (23 of 1959) and who has obtained a certificate of practice under sub-section (1) of section 6 of that Act;

    (d) ―legal practitioner‖ means an advocate, vakil or any attorney of any High Court, and includes a leader in practice.]


Limitation.

3W. The provisions of the Limitation Act, 1963 (36 of 1963), shall, as far as may be, apply to an appeal made to a Securities Appellate Tribunal.

122[Presiding Officer, Members and staff of Securities Appellate Tribunals to be public servants.

3X. The Presiding Officer, Members and other officers and employees of a Securities Appellate Tribunal shall be deemed to be public servants within the meaning of section 21 of the Indian Penal Code (45 of 1860).]

Civil Court not to have jurisdiction.

3Y. No civil court shall have jurisdiction to entertain any suit or proceeding in respect of any matter which an adjudicating officer appointed under this Act or a Securities Appellate Tribunal constituted under this Act is empowered by or under this Act to determine and no injunction shall be granted by any court or other authority in respect of any action taken or to be taken in pursuance of any power conferred by or under this Act.

123[Appeal to Supreme Court.

3Z. Any person aggrieved by any decision or order of the Securities Appellate Tribunal may file an appeal to the Supreme Court within sixty days from the date of communication of the decision or order of the Securities Appellate Tribunal to him on any question of law arising out of such order :

Provided that the Supreme Court may, if it is satisfied that the applicant was prevented by sufficient cause from filing the appeal within the said period, allow it to be filed within a further period not exceeding sixty days.]

MISCELLANEOUS

Power of Central Government to issue directions:

1. (1) Without prejudice to the foregoing provisions of this Act 124[or the Depositories Act, 1996], the Board shall, in the exercise of its powers or the performance of its functions under this Act, be bound by such directions on questions of policy as the Central Government may give in writing to it from time to time :

Provided that the Board shall, as far as practicable, be given an opportunity to express its views before any direction is given under this subsection.

(2) The decision of the Central Government whether a question is one of policy or not shall be final.

Power of Central Government to supersede the Board.

2. (1) If at any time the Central Government is of opinion—

    (a) that on account of a grave emergency, the Board is unable to discharge the functions and duties imposed on it by or under the provisions of this Act; or

    (b) that the Board has persistently made default in complying with any direction issued by the Central Government under this Act or in the discharge of the functions and duties imposed on it by or under the provisions of this Act and as a result of such default the financial position of the Board or the administration of the Board has deteriorated; or

    (c) that circumstances exist which render it necessary in the public interest so to do, the Central Government may, by notification, supersede the Board for such period, not exceeding six months, as may be specified in the notification.


(2) Upon the publication of a notification under sub-section (1) superseding the Board,—


    (a) all the members shall, as from the date of supersession, vacate their offices as such;

    (b) all the powers, functions and duties which may, by or under the provisions of this Act, be exercised or discharged by or on behalf of the Board, shall until the Board is reconstituted under sub-section (3), be exercised and discharged by such person or persons as the Central Government may direct; and

    (c) all property owned or controlled by the Board shall until the Board is reconstituted under sub-section (3), vest in the Central Government.


(3) On the expiration of the period of supersession specified in the notification issued under sub-section (1), the Central Government may reconstitute the Board by a fresh appointment and in such case any person or persons who vacated their offices under clause (a) of sub-section (2), shall not be deemed disqualified for appointment :

Provided that the Central Government may, at any time, before the expiration of the period of supersession, take action under this subsection.

(4) The Central Government shall cause a notification issued under sub-section (1) and a full report of any action taken under this section and the circumstances leading to such action to be laid before each House of Parliament at the earliest.

Returns and reports.

3. (1) The Board shall furnish to the Central Government at such time and in such form and manner as may be prescribed or as the Central Government may direct, such returns and statements and such particulars in regard to any proposed or existing programme for the promotion and development of the securities market, as the Central Government may, from time to time, require.

(2) Without prejudice to the provisions of sub-section (1), the Board shall, within 125[ninety] days after the end of each financial year, submit to the Central Government a report in such form, as may be prescribed, giving a true and full account of its activities, policy, and programmes during the previous financial year.

(3) A copy of the report received under sub-section (2) shall be laid, as soon as may be after it is received, before each House of Parliament.

Delegation.

4. The Board may, by general or special order in writing delegate to any member, officer of the Board or any other person subject to such conditions, if any, as may be specified in the order, such of its powers and functions under this Act (except the powers under section 29) as it may deem necessary.

Appeals.

5. (1) Any person aggrieved by an order of the Board made 126[, before the commencement of the Securities Laws (Second Amendment) Act, 1999,] under this Act, or the rules or regulations made there under may prefer an appeal to the Central Government within such time as may be prescribed.

(2) No appeal shall be admitted if it is preferred after the expiry of the period prescribed
therefor:

Provided that an appeal may be admitted after the expiry of the period prescribed therefor if the appellant satisfies the Central Government that he had sufficient cause for not preferring the appeal within the prescribed period.

(3) Every appeal made under this section shall be made in such form and shall be accompanied by a copy of the order appealed against and by such fees as may be prescribed.

(4) The procedure for disposing of an appeal shall be such as may be prescribed:

Provided that before disposing of an appeal, the appellant shall be given a reasonable opportunity of being heard.

127[Bar of jurisdiction.

5A. No order passed by the Board 128[or the Adjudicating Officer] under this Act shall be appealable except as provided in 129[ section 3T or ] section 20 and no civil court shall have jurisdiction in respect of any matter which the Board 130[or the Adjudicating Officer] is empowered by, or under, this Act to pass any order and no injunction shall be granted by any court or other authority in respect of any action taken or to be taken in pursuance of any order passed by the Board 131[or the Adjudicating Officer] by, or under, this Act.]

Savings.

6 . Nothing in this Act shall exempt any person from any suit or other proceedings which might, apart from this Act, be brought against him.

Members, officers and employees of the Board to be public servants.

7. All members, officers and other employees of the Board shall be deemed, when acting or purporting to act in pursuance of any of the provisions of this Act, to be public servants within the meaning of section 21 of the Indian Penal Code (45 of 1860).

Protection of action taken in good faith.

8. No suit, prosecution or other legal proceedings shall lie against the Central Government 132[or Board] or any officer of the Central Government or any member, officer or other employee of the Board for anything which is in good faith done or intended to be done under this Act or the rules or regulations made thereunder.


133[Offences.

9. (1) Without prejudice to any award of penalty by the adjudicating officer under this Act, if any person contravenes or attempts to contravene or abets the contravention of the provisions of this Act or of any rules or regulations made there under, he shall be punishable with imprisonment for a term which may extend to 134[ten years, or with fine, which may extend to twenty-five crore rupees or with both].

(2) If any person fails to pay the penalty imposed by the adjudicating officer or fails to comply with any of his directions or orders, he shall be punishable with imprisonment for a term which shall not be less than one month but which may extend to 135[ten years, or with fine, which may extend to twenty-five crore rupees or with both].

136[Composition of certain offenses.

9A. Notwithstanding anything contained in the Code of Criminal Procedure, 1973 (2 of 1974), any offense punishable under this Act, not being an offense punishable with imprisonment only, or with imprisonment and also with fine, may either before or after the institution of any proceeding, be compounded by a Securities Appellate Tribunal or a court before which such proceedings are pending.

Power to grant immunity.

9B. (1) The Central Government may, on a recommendation by the Board, if the Central Government is satisfied, that any person, who is alleged to have violated any of the provisions of this Act or the rules or the regulations made there under, has made a full and true disclosure in respect of the alleged violation, grant to such person, subject to such conditions as it may think fit to impose, immunity from prosecution for any offense under this Act, or the rules or the regulations made thereunder or also from the imposition of any penalty under this Act with respect to the alleged violation:

Provided that no such immunity shall be granted by the Central Government in cases where the proceedings for the prosecution for any such offense have been instituted before the date of receipt of an application for grant of such immunity:

Provided further that recommendation of the Board under this subsection shall not be binding upon the Central Government.

(2) An immunity granted to a person under sub-section (1) may, at any time, be withdrawn by the Central Government, if it is satisfied that such person had, in the course of the proceedings, not complied with the condition on which the immunity was granted or had given false evidence, and thereupon such person may be tried for the offence with respect to which the immunity was granted or for any other offence of which he appears to have been guilty in connection with the contravention and shall also become liable to the imposition of any penalty under this Act to which such person would have been liable, had not such immunity been granted.]

Exemption from tax on wealth and income.


10. Notwithstanding anything contained in the Wealth-tax Act, 1957 (27 of 1957), the Income-tax Act, 1961 (43 of 1961) or any other enactment for the time being in force relating to tax on wealth, income, profits or gains—

    (a) the Board;

    (b) the existing Securities and Exchange Board from the date of its constitution to the date of establishment of the Board,


shall not be liable to pay wealth-tax, income-tax or any other tax in respect of their wealth, income, profits or gains derived.

Cognizance of offenses by courts.

11. (1) No court shall take cognizance of any offense punishable under this Act or any rules or regulations made there under, save on a complaint made by the Board 137[* * *].

138[(2) *****]

139[ Establishment of Special Courts.

11A. (1) The Central Government may, for the purpose of providing a speedy trial of offenses
under this Act, by notification, establish or designate as many Special Courts as may be necessary.

(2) A Special Court shall consist of a single judge who shall be appointed by the Central A government with the concurrence of the Chief Justice of the High Court within whose jurisdiction the judge to be appointed is working.
(3) A person shall not be qualified for appointment as a judge of a Special Court unless he is, immediately before such appointment, holding the office of a Sessions Judge or an Additional Sessions Judge, as the case may be.


Offenses triable by Special Courts.

11B. Notwithstanding anything contained in the Code of Criminal Procedure, 1973, all offenses under this Act committed prior to the date of commencement of the Securities Laws (Amendment) Act, 2014 or on or after the date of such commencement, shall be taken cognizance of and tried by the Special Court established for the area in which the offense is committed or where there are more Special Courts than one for such area, by such one of them as may be specified in this behalf by the High Court concerned.


Appeal and revision.

11C. The High Court may exercise, so far as may be applicable, all the powers conferred by Chapters XXIX and XXX of the Code of Criminal Procedure, 1973 on a High Court, as if a Special Court within the local limits of the jurisdiction of the High Court were a Court of Session trying cases within the local limits of the jurisdiction of the High Court.

Application of Code to proceedings before Special Court.

11D. (1) Save as otherwise provided in this Act, the provisions of the Code of Criminal Procedure, 1973 shall apply to the proceedings before a Special Court and for the purposes of the said provisions, the Special Court shall be deemed to be a Court of Session and the person conducting prosecution before a Special Court shall be deemed to be a Public Prosecutor within the meaning of clause (u) of section 2 of the Code of Criminal Procedure, 1973.

(2) The person conducting prosecution referred to in sub-section (1) should have been in practice as an advocate for not less than seven years or should have held a post, for a period of not less than seven years, under the Union or a State, requiring special knowledge of law. Transitional provisions.

11E. Any offense committed under this Act, which is triable by a Special Court shall, until a Special Court is established, be taken cognizance of and tried by a Court of Session exercising jurisdiction over the area, notwithstanding anything contained in the Code of Criminal procedure, 1973:

Provided that nothing contained in this section shall affect the powers of the High Court under section 407 of the Code of Criminal Procedure, 1973 to transfer any case or class of cases taken cognizance by a Court of Session under this section.]

Offences by companies.

12. (1) Where an offense under this Act has been committed by a company, every person who at
the time the offense was committed was in charge of, and was responsible to, the company for the conduct of the business of the company, as well as the company, shall be deemed to be guilty of the offense and shall be liable to be proceeded against and punished accordingly:

Provided that nothing contained in this sub-section shall render any such person liable to any punishment provided in this Act if he proves that the offense was committed without his knowledge or that he had exercised all due diligence to prevent the commission of such offense.

(2) Notwithstanding anything contained in sub-section (1), where an offense under this Act has been committed by a company and it is proved that the offence has been committed with the consent or connivance of, or is attributable to any neglect on the part of, any director, manager, secretary or other officers of the company, such director, manager, secretary or other officers shall also be deemed to be guilty of the offense and shall be liable to be proceeded against and punished accordingly.

Explanation: For the purposes of this section,—

    (a) ―company‖ means any body corporate and includes a firm or other association of individuals; and

    (b) ―director‖, in relation to a firm, means a partner in the firm.


Power to exempt.

13. 140[***]

141[ Recovery of amounts.

13A. (1) If a person fails to pay the penalty imposed by the adjudicating officer or fails to comply with any direction of the Board for a refund of monies or fails to comply with a direction of disgorgement order issued under section 11B or fails to pay any fees due to the Board, the Recovery Officer may draw up under his signature a statement in the specified form specifying the amount due from the person (such statement being hereafter in this Chapter referred to as certificate) and shall proceed to recover from such person the amount specified in the certificate by one or more of the following modes, namely:—


    (a) attachment and sale of the person’s movable property;

    (b) attachment of the person’s bank accounts;

    (c) attachment and sale of the person’s immovable property;

    (d) arrest of the person and his detention in prison;

    (e) appointing a receiver for the management of the person’s movable and immovable properties,


and for this purpose, the provisions of sections 220 to 227, 228A, 229, 232, the Second and Third Schedules to the Income-tax Act, 1961 and the Income-tax (Certificate Proceedings) Rules, 1962, as in force from time to time, in so far as may be, apply with necessary modifications as if the said provisions and the rules made thereunder were the provisions of this Act and referred to the amount due under this Act instead of to income-tax under the Income-tax Act, 1961.

Explanation 1.— For the purposes of this subsection, the person’s movable or immovable property or monies held in bank accounts shall include any property or monies held in bank accounts which has been transferred directly or indirectly on or after the date when the amount specified in certificate had become due, by the person to his spouse or minor child or son’s wife or son’s minor child, otherwise than for adequate consideration, and which is held by, or stands in the name of, any of the persons aforesaid; and so far as the movable or immovable property or monies held in bank accounts so transferred to his minor child or his son’s minor child is concerned, it shall, even after the date of attainment of majority by such minor child or son’s minor child, as the case may be, continue to be included in the person’s movable or immovable property or monies held in bank accounts for recovering any amount due from the person under this Act.

Explanation 2.— Any reference under the provisions of the Second and Third Schedules to the Income-tax Act, 1961 and the Income-tax (Certificate Proceedings) Rules, 1962 to the assessee shall be construed as a reference to the person specified in the certificate.

Explanation 3.— Any reference to appeal in Chapter XVIID and the Second Schedule to the Income-tax Act, 1961, shall be construed as a reference to appeal before the Securities Appellate Tribunal under section 3T of this Act.

(2) The Recovery Officer shall be empowered to seek the assistance of the local district administration while exercising the powers under sub-section (1).

(3) Notwithstanding anything contained in any other law for the time being in force, the recovery of amounts by a Recovery Officer under sub-section (1), pursuant to non-compliance with any direction issued by the Board under section 11B, shall have precedence over any other claim against such person.

(4) For the purposes of sub-sections (1), (2) and (3), the expression ̳ ̳Recovery Officer‘‘ means any officer of the Board who may be authorized, by general or special order in writing, to exercise the powers of a Recovery Officer.]

Power to make rules.

14. (1) The Central Government may, by notification, make rules for carrying out the purposes of this Act.

(2) In particular, and without prejudice to the generality of the foregoing power, such rules may provide for all or any of the following matters, namely:—

    (a) the term of office and other conditions of service of the Chairman and the members under sub-section (1) of section 5;

    (b) the additional functions that may be performed by the Board under section 11;

    (c)142[* * *]

    (d) the manner in which the accounts of the Board shall be maintained under section 3;
    143[(da) the manner of inquiry under sub-section (1) of section 3-I;

    (db) the salaries and allowances and other terms and conditions of service of the 144[Presiding Officers, Members] and other officers and employees of the Securities Appellate Tribunal under section 3-O and sub-section (3) of section 3S;

    (dc) the procedure for the investigation of misbehavior or incapacity of the 145[Presiding Officers, or other Members] of the Securities Appellate Tribunal under sub-section (3) of section 3Q;

    (dd) the form in which an appeal may be filed before the Securities Appellate Tribunal under section 3T and the fees payable in respect of such appeal;]

    (e) the form and the manner in which returns and report to be made to the Central Government under section 18;

    (f) any other matter which is to be, or may be, prescribed, or in respect of which provision is to be, or may be, made by rules.


Power to make regulations.

15. (1) The Board may, 146[***] by notification, make regulations consistent with this Act and the rules made thereunder to carry out the purposes of this Act.

(2) In particular, and without prejudice to the generality of the foregoing power, such regulations may provide for all or any of the following matters, namely:—

    (a) the times and places of meetings of the Board and the procedure to be followed at such meetings under sub-section (1) of section 7 including quorum necessary for the transaction of business;

    (b) the terms and other conditions of service of officers and employees of the Board under sub-section (2) of section 9;

    147[(c) the matters relating to the issue of capital, transfer of securities and other matters incidental thereto and the manner in which such matters shall be disclosed by the companies under section 11A;

    148[(ca) the utilization of the amount credited under sub-section (5) of section 11;


    (cb) the fulfillment of other conditions relating to collective investment scheme under sub- section (2A) of section 11AA;]


    ((d) the conditions subject to which certificate of registration is to be issued, the amount of fee to be paid for the certificate of registration and the manner of suspension or cancellation of the certificate of registration under section 12.]

    149[(da) the terms determined by the Board for settlement of proceedings under sub-section (2) and the procedure for conducting of settlement proceedings under sub-section (3) of section 3JB;

    (db) any other matter which is required to be, or may be, specified by regulations or in respect of which provision is to be made by regulations.]


Rules and regulations to be laid before Parliament.

16. Every rule and every regulation made under this Act shall be laid, as soon as may be after it is made, before each House of Parliament, while it is in session, for a total period of thirty days which may be comprised in one session or in two or more successive sessions, and if, before the expiry of the session immediately following the session or the successive sessions aforesaid, both Houses agree in making any modification in the rule or regulation or both Houses agree that the rule or regulation should not be made, the rule or regulation shall thereafter have effect only in such modified form or be of no effect, as the case may be; so, however, that any such modification or annulment shall be without prejudice to the validity of anything previously done under that rule or regulation.

Application of other laws not barred.

17. The provisions of this Act shall be in addition to, and not in derogation of, the provisions of any other law for the time being in force.

Amendment of certain enactments.

18. [Repealed by Repealing & Amending Act, 2001.]

Power to remove difficulties.

19. (1) If any difficulty arises in giving effect to the provisions of this Act, the Central Government may, by order, published in the Official Gazette, make such provisions not inconsistent with the provisions of this Act as may appear to be necessary for removing the difficulty :

Provided that no order shall be made under this section after the expiry of five years from the commencement of this Act.

(2) Every order made under this section shall be laid, as soon as may be after it is made, before each House of Parliament.

150[Validation of certain acts.

19A. Any act or thing done or purporting to have been done under the principal Act, in respect of calling for information from, or furnishing information to, other authorities, whether in India or outside India, having functions similar to those of the Board and in respect of settlement of administrative and civil proceedings, shall, for all purposes, be deemed to be valid and effective as if the amendments made to the principal Act had been in force at all material times.]
Repeal and saving.

20. (1) The Securities and Exchange Board of India Ordinance, 1992 (Ord. 5 of 1992), is hereby repealed.

(2) Notwithstanding such repeal, anything is done or any action taken under the said Ordinance shall be deemed to have been done or taken under the corresponding provisions of this Act.

Section 3
The establishment and incorporation of Board

Section 4

The management of the Board

Section 5

The term of office and conditions of service of Chairman and members of the Board

Section 6

The removal of the member of the office

Section 7

Regarding meetings

Section 8

Proceeding of the Board with respect to any vacancy of the board

Section 10

Transfer of Assets, Liabilities etc. of the existing Securities and Exchange Board to the Board

Section 11

The functions and duties of the Securities Exchange Board of India

Section 12

Registration of stock brokers, sub-brokers, share transfer agents, etc.

Section 15

Provisions related with penalties
Some important rules/regulations/guidelines prescribed by the SEBI are given hereunder:

1. SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2009

2. SEBI (Central Listing Authority) Regulations, 2003

3. SEBI (Delisting of Securities) Guidelines, 2003

4. SEBI (Employees Stock Option Scheme and Employees Stock Purchase Scheme) Guidelines, 1999

5. SEBI (Issue of Sweat Equity) Regulations, 2002

6. SEBI (Buy-Back of Securities) Regulations, 1998

7. SEBI (Substantial Acquisition of Shares and Takeover) Regulations, 1997

8. SEBI (Prohibition of Fraudulent and Unfair Trade Practices relating to Securities Markets) Regulations, 2003

9. SEBI (Prohibition of Fraudulent and Unfair Trade Practices relating to Securities Markets) Regulations, 1995

10. SEBI (Mutual Funds) Regulations, 1996

11. SEBI (Collective Investment Schemes) Regulations, 1999

12. SEBI Guidelines for Foreign Institutional Investors

13. SEBI (FIIs) Regulations, 1995

14. SEBI (Venture Capital Funds) Regulations, 1996

15. SEBI (Foreign Venture Capital Funds) Regulations

16 SEBI (Depositories and Participants) Regulations, 1996

17. SEBI (Custodian of Securities) Regulations, 1996

18. SEBI (Credit Rating Agencies) Regulations, 1999

19. SEBI (Merchant Bankers) Rules, 1992

20. SEBI (Merchant Bankers) Regulations, 1992/SEBI (Registrars to an issue and Share Transfer Agents) Rules, 1993

21. SEBI (Registrars to an issue and Share Transfer Agents) Regulation, 1993

22. SEBI (Underwriters) Rules, 1993

23. SEBI (Underwriters) Regulations, 1993

24. SEBI (Debenture Trustees) Rules, 1993

25. SEBI (Debenture Trustees) Regulations, 1993/SEBI (Bankers to an Issue) Rules, 1994

26. SEBI (Bankers to an Issue) Regulations, 1994

27. SEBI (Stock Brokers and Sub-Brokers) Rules, 1992

28. SEBI (Stock Brokers and Sub-Brokers) Regulations, 1992

29. SEBI (Portfolio Manager) Rules, 1993

30. SEBI (Portfolio Manager) Regulations, 1993

31. SEBI (Ombudsman) Regulations, 2003.

SCHEDULES UNDER SECURITIES AND EXCHANGE BOARD OF INDIA (ISSUE OF CAPITAL AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2009

Schedule I

Inter-se Allocation of Responsibilities

Schedule II

The format of Agreement between Lead Merchant Bankers to the Issue and Issuer/Issuing Company

Schedule III

Mandatory Collection Centres

Schedule IV

Fees to be paid along with Offer Document (Includes two parts)

  • Part A: Fees to be Paid along with Draft Offer Document or in case of a Fast Track Issue, along with Offer Document

  • Part B: Fees to be paid along with Updated Offer Document


Schedule V

The manner of Submission of Soft Copy of Draft Offer document and Offer Document to the Board

Schedule VI

Formats of Due Diligence Certificates (Contains Six forms)

  • Form A: Format of Due Diligence Certificate to be Given by Lead Merchant Banker along with Draft Offer Document

  • Form B: Format of Due Diligence Certificate to be given by Debenture Trustee along with Draft Offer Document

  • Form C: Format of Due Diligence Certificate to be given by Merchant Banker at the Time of Registering Offer Document with the Registrar of Companies/ Filing Letter of Offer with the Designated StockExchange.

  • Form D: Format of Due Diligence Certificate to be given by Merchant Banker Immediately Before Opening of the Issue,

  • Form E: Format of Due Diligence Certificate to be given by Merchant Banker after Opening of the Issue but Before Closure of Subscription

  • Form F: Additional Confirmations/ Certification to be given by Merchant Banker in Due Diligence Certificate to be given along with Offer Document for Fast Track Issue

  • Form G: Format of Due Diligence Certificate to be given by Merchant Banker along with Final Post Issue Report


Schedule VII

Nature of Updation/ Changes in the Offer Document and Consequent Steps therein Requiring Filing of Updated Offer Document

Schedule VIII

Disclosures in Offer Document, Abridged Prospectus and Abridged Letter of Offer (Contains Six parts)

  • Part A: Disclosures in Red Herring Prospectus, Shelf Prospectus, and Prospectus

  • Part B: Certain Disclosures Not Mandatory in case of Fast Track Public Issue

  • Part C : Certain Disclosures Not Mandatory in case of Further Public Offer

  • Part D : Disclosures in Abridged Prospectus

  • Part E : Disclosures in Letter of Offer

  • Part F : Disclosures in Abridged Letter of Offer


Schedule IX

The format of Report to be submitted by Monitoring Agency

Schedule X

Facilities or Services included in the term “Infrastructure Sector”

Schedule XI

Book Building Process (Contains Four parts)

  • Part A: Book Building Process Requirements

  • Part B: Format of Bid Data displayed on the Stock Exchange

  • Part C: Illustration regarding Allotment to Qualified Institutional Buyers other than Anchor Investors

  • Part D: Alternate method of book building


Schedule XII

The format of Report for Green Shoe Option

Schedule XIII

Formats of Advertisements for Public Issue (Contains Three parts)

  • Part A: Format of Pre-Issue Advertisement for Public Issue (Fixed Price/ Book built)

  • Part B: Format of Issue Opening Advertisement for Public Issue (Fixed Price/ Book built)

  • Part C : Format of Issue Closing Advertisement for Public Issue (Fixed Price/ Book built)


Schedule XIV

Illustration Explaining Minimum Application Size

Schedule XV

Illustration Explaining Procedure of Allotment

Schedule XVI

Formats of Post Issue Reports (Contains Four parts)

  • Part A : Format of Initial Post Issue Report for Public Issue

  • Part B : Format of Initial Post Issue Report for Rights Issue

  • Part C : Format of Final Post Issue Report for Public Issue

  • Part D : Format of Final Post Issue Report for Rights Issue


Schedule XVII

Format of Underwriting Devolvement Statement

Schedule XVIII

Disclosures in Placement Document

Schedule XIX

Disclosures in Prospectus and Abridged Prospectus for Issue of Indian Depository Receipts (Contains Three parts)

  • Part A : Disclosures in Prospectus for Issue of Indian Depository Receipts

  • Part B: Disclosures in Abridged Prospectus for Issue of Indian Depository Receipts

  • Part C: Format of the Due Diligence Certificate to be filed by the Lead Manager For IDR Issues


Schedule XX

Amendments to Other Regulations


Important Sections of Securities Laws (Amendment) Bill, 2003

Section 23A

Failure to furnish information, books etc. or maintain books, records etc. as required under listing agreement or byelaws of an exchange.


Section 23B

Failure to enter into an agreement with the client

Section 23C

Failure to redress the grievances of investors by a broker, sub-broker, a listed or proposed to be listed company, after being called upon to do so by SEBI or Exchange

Section 23F

Dematerialization in excess of the listed securities

Section 23G

Failure or neglect by an Exchange to furnish periodical returns or to comply with any direction of SEBI.