Skip to content

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

SEBI finds that a depository's bye-laws lack a procedure for resolving disputes involving the depository, issuer, company or a beneficial owner. SEBI directs it by written order to amend its bye-laws within 60 days, but the depository does nothing. What may SEBI do under the Depositories Act, 1996?

SEBI may itself make or amend the bye-laws. When a depository fails or neglects to comply with a written order within the specified period, the Board can make, amend or revoke the bye-laws in the form specified or with modifications it thinks fit.

  1. AOnly impose a penalty and wait for the depository to act
  2. BMake or amend the bye-laws itself, in the form specified in the order or with such modifications as it thinks fitCorrect
  3. CRefer the matter to the issuer to amend the bye-laws
  4. DCancel the depository's securities admitted without any further step

Explanation

The Board may direct a depository by written order to make, amend or revoke bye-laws within a specified period. If the depository fails or neglects to comply, the Board may itself make, amend or revoke the bye-laws, in the form in the order or with modifications it thinks fit. The penalty-only option ignores this express power.

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