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CS Executive · Capital Market and Securities Laws · Secondary Market in India

SEBI penalises a trader, Ravi Nair, and the amount is realised under the SEBI Act, 1992. Where must the sum realised by way of penalties under that Act be credited?

The penalty must be credited to the Consolidated Fund of India. Section 15JA of the SEBI Act, 1992 states that all sums realised by way of penalties under the Act go to that Fund, not to SEBI's own reserves or to investors.

  1. ATo the Investor Protection Fund of the stock exchange
  2. BTo the Consolidated Fund of IndiaCorrect
  3. CTo the general reserve of SEBI
  4. DTo the investors who suffered the loss

Explanation

Section 15JA of the SEBI Act provides that all sums realised by way of penalties under the Act are credited to the Consolidated Fund of India. SEBI does not retain them, and they are not paid to exchanges or investors by this provision.

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