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CS Executive · Capital Market and Securities Laws · Securities Contracts (Regulation) Act, 1956

Zenith Stock Exchange proposes bye-laws that regulate or prohibit blank transfers and budlas or carry-over facilities, and that fix the days for settlements. Which statement about the power under section 9 is correct?

Regulating or prohibiting blank transfers and budlas or carry-over facilities, and fixing settlement days, are matters the bye-laws of a recognised stock exchange may provide for under section 9(2), without prejudice to the general bye-law power and subject to SEBI approval.

  1. AThese matters are outside section 9 and need a SEBI regulation only
  2. BOnly a clearing house may regulate them, not the exchange
  3. CThese are matters the bye-laws may specifically provide for under section 9(2)Correct
  4. DThe exchange may deal with them only after the Central Government notifies them

Explanation

Section 9(2) lists, among other matters, regulation or prohibition of blank transfers (e), budlas or carry-over facilities (g) and fixing or postponing settlement days (h). The list is without prejudice to the general power. So the exchange can legitimately provide for them, subject to SEBI approval.

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