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

Zenith Polymers Ltd, a listed company, breaches the listing conditions applicable to it. Under the Securities Contracts (Regulation) Act, 1956, what is the penalty range for such a failure?

The penalty for failing to comply with listing or delisting conditions under Section 23E of the SCRA is not less than five lakh rupees and may extend to twenty-five crore rupees. The minimum was introduced by a 2014 amendment replacing the earlier cap-only wording.

  1. ANot less than five lakh rupees but may extend to twenty-five crore rupeesCorrect
  2. BNot exceeding twenty-five crore rupees, with no minimum amount
  3. CNot less than twenty-five lakh rupees but may extend to five crore rupees
  4. DA fixed penalty of five lakh rupees only

Explanation

Section 23E provides a penalty of at least five lakh rupees which may extend to twenty-five crore rupees. The older wording 'not exceeding twenty-five crore rupees' was substituted in 2014, so option 2 is outdated and wrong.

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