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CS Executive · Capital Market and Securities Laws · Securities Contracts (Regulation) Act, 1956

Meghdoot Textiles Ltd's equity shares are listed on a recognised stock exchange on the company's own application. Under the Securities Contracts (Regulation) Act, 1956, what must the company comply with in respect of that listing?

The company must comply with the conditions of the listing agreement with the stock exchange on which its securities are listed. The Act places this duty on any person on whose application securities are listed, so it is the listing agreement, not Articles or other exchanges' bye-laws, that governs.

  1. AThe conditions of the listing agreement with that stock exchangeCorrect
  2. BOnly the Companies Act provisions on allotment
  3. CThe bye-laws of every recognised stock exchange in India
  4. DConditions fixed by the company's own Articles of Association

Explanation

The Act states that where securities are listed on the application of any person on a recognised stock exchange, that person must comply with the conditions of the listing agreement with that exchange. The other options name sources of obligation that the section does not prescribe for listing conditions.

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