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CS Executive · Capital Market and Securities Laws · Securities and Exchange Board of India

Under Section 3 of the SEBI Act, 1992, which statement about the establishment and status of the Board is correct?

Section 3 provides that the Board is established from a date notified by the Central Government and is a body corporate with perpetual succession and a common seal. It can hold property, contract, and sue or be sued in its name.

  1. AThe Board is established from a date appointed by the Central Government by notification, and is a body corporate with perpetual succession and a common sealCorrect
  2. BThe Board is established from 30 January 1992 by operation of Section 1 and has no power to hold property
  3. CThe Board is a body corporate but cannot sue or be sued in its own name
  4. DThe Board has its head office at Delhi and may not set up offices elsewhere

Explanation

Section 3(1) makes establishment effective from a date the Central Government appoints by notification. Section 3(2) makes the Board a body corporate with perpetual succession and a common seal, able to hold property, contract, and sue or be sued. Section 3(3) puts the head office at Bombay and Section 3(4) allows offices elsewhere in India.

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