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CS Executive · Capital Market and Securities Laws · Listing Obligations and Disclosure Requirements

Under Section 17A of the SCRA, listing permission for an issuer's securities is refused by the exchange. The issuer has received application money but repays none of it. After how many days from becoming liable to repay does the issuer and its defaulting director or trustee become jointly and severally liable for interest, and at what rate?

Liability for interest starts after the eighth day from when the issuer becomes liable to repay, and the rate is fifteen per cent per annum. The issuer and each director or trustee in default are jointly and severally liable under Section 17A(3) of the SCRA.

  1. AAfter eight days, at fifteen per cent per annumCorrect
  2. BAfter eight days, at twelve per cent per annum
  3. CAfter fifteen days, at eight per cent per annum
  4. DAfter thirty days, at fifteen per cent per annum

Explanation

Section 17A(3) says that if money is not repaid within eight days after the issuer becomes liable, the issuer and each director or trustee in default become jointly and severally liable from the expiry of the eighth day, with interest at fifteen per cent per annum. The options reversing or altering the numbers do not match the text.

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