Skip to content

CS Executive · Capital Market and Securities Laws · Securities Market Intermediaries

SEBI proposes to cancel the certificate of registration of a registered merchant banker. Under Section 12(3) of the SEBI Act, 1992, which condition applies?

SEBI may suspend or cancel a certificate of registration by order, but only after giving the person concerned a reasonable opportunity of being heard. Section 12(3) makes the hearing a mandatory proviso, and it does not require any prior court order.

  1. ASEBI may suspend or cancel by order, but only after giving the person a reasonable opportunity of being heardCorrect
  2. BSEBI may cancel without any hearing if the order is recorded in writing
  3. CSEBI may suspend but never cancel a certificate
  4. DSEBI must first obtain a court order before cancelling

Explanation

Section 12(3) allows the Board to suspend or cancel a certificate by order in the manner determined by regulations, with the proviso that no such order shall be made unless the person has been given a reasonable opportunity of being heard. No court order is required.

Did you get it right without looking?

One question tells you little. A timed set on Securities Market Intermediaries shows your real accuracy, how long you take and where you lose marks.

Practise Securities Market IntermediariesFree diagnostic mock

More Securities Market Intermediaries questions