CS Executive · Capital Market and Securities Laws · Basics of Capital Market
Arjun Traders wants to understand the legal basis of SEBI. SEBI was first constituted as an administrative body in 1988 and later acquired statutory status. Under which enactment did it become a statutory body?
SEBI became a statutory body under the Securities and Exchange Board of India Act, 1992. Before that it functioned as an administrative body from 1988. The SCRA 1956 regulates securities contracts and exchanges, and the Depositories Act 1996 governs depositories, so neither created SEBI.
- ASecurities and Exchange Board of India Act, 1992Correct
- BSecurities Contracts (Regulation) Act, 1956
- CCompanies Act, 1956
- DDepositories Act, 1996
Explanation
SEBI received statutory powers through the SEBI Act, 1992. The SCRA, 1956 regulates stock exchanges and securities contracts but did not create SEBI. The Depositories Act governs depositories and was enacted later.
Did you get it right without looking?
One question tells you little. A timed set on Basics of Capital Market shows your real accuracy, how long you take and where you lose marks.
More Basics of Capital Market questions
- Which of the following best explains why a well-developed secondary market supports the functioning of the primary market?
- Kaveri Auto Ltd, a listed company, offers new equity shares only to its existing shareholders in the ratio of 1 share for every 5 held, at a…
- Sunrise Textiles Ltd, an unlisted company, offers its shares to the general public for the first time through a prospectus to raise funds fo…
- Meera, a retail investor in Pune, wants to know which statutory body primarily regulates stock exchanges, mutual funds and other intermediar…
- Arjun's company wants to raise funds through a public issue of equity shares. Which regulator's framework, together with the Companies Act, …
- Meera, a retail investor, buys 200 shares of a listed company directly from another investor through a stock exchange platform, with no fres…