Skip to content

CS Executive · Capital Market and Securities Laws · Laws Governing Depositories and Depository Participants

SEBI considers that a depository's bye-laws on dispute resolution are inadequate. The depository ignores SEBI's written order to amend them within the specified period. Under the Depositories Act, 1996, what can SEBI do?

SEBI may itself make, amend or revoke the bye-laws, either in the form specified in its order or with such modifications as it thinks fit. This power arises under Section 26(4) when the depository fails or neglects to comply with SEBI's written order within the specified period.

  1. AMake or amend the bye-laws itself, in the form in its order or with modifications it thinks fitCorrect
  2. BOnly impose a monetary penalty, with no power over the bye-laws
  3. CRefer the matter to the Central Government to amend the bye-laws
  4. DWait for the depository's next general meeting to vote on the order

Explanation

Section 26(3) lets the Board direct a depository by written order to make, amend or revoke bye-laws. Under 26(4), on failure to comply in time, the Board may itself make, amend or revoke them in the form specified or with modifications it thinks fit. Referral to the Central Government is not provided.

Did you get it right without looking?

One question tells you little. A timed set on Laws Governing Depositories and Depository Participants shows your real accuracy, how long you take and where you lose marks.

Practise Laws Governing Depositories and Depository ParticipantsFree diagnostic mock

More Laws Governing Depositories and Depository Participants questions