24 Questions
What is the primary purpose of the Securities Contracts (Regulation) Act, 1956?
To regulate the business of dealing in securities and prevent undesirable transactions
Under which section of the Act can the Securities Appellate Tribunal hear appeals?
Section 23JB
What is the purpose of Section 23K of the Act?
To credit sums realised by way of penalties to the Consolidated Fund of India
What is the purpose of Section 23N of the Act?
To grant immunity to those who disclose violations, fraud, or malpractices
Under which section of the Act can the Securities and Exchange Board of India make regulations?
Section 31
What is the purpose of Section 28 of the Act?
To exempt certain cases from the application of the Act
Under which section of the Act can the Central Government delegate powers to the Securities and Exchange Board of India?
Section 29A
What is the purpose of Section 26A of the Act?
To establish Special Courts for the trial of certain offences
What is the maximum time period for the Central Government to supersede the governing body of a recognised stock exchange?
7 days
What is the purpose of Section 6 of the Securities Contracts (Regulation) Act, 1956?
To call for periodical returns or direct inquiries to be made
What is the provision that deals with the power of the Central Government to issue directions to stock exchanges?
Section 12A
What is the purpose of Section 7 of the Securities Contracts (Regulation) Act, 1956?
To furnish annual reports to the Central Government by stock exchanges
What is the provision that deals with the power of the recognised stock exchange to make rules restricting voting rights?
Section 7A
What is the purpose of Section 4A of the Securities Contracts (Regulation) Act, 1956?
Corporatisation and demutualisation of stock exchanges
What is the provision that deals with the power of the Central Government to suspend the business of recognised stock exchanges?
Section 12
What is the purpose of Section 3 of the Securities Contracts (Regulation) Act, 1956?
Application for recognition of stock exchanges
What is the purpose of a Government security as per the Securities Contracts (Regulation) Act, 1956?
To raise a public loan
What is meant by 'demutualisation' under the Securities Contracts (Regulation) Act, 1956?
The segregation of ownership and management from the trading rights of members of a recognised stock exchange
What is included in the definition of a 'contract' under the Securities Contracts (Regulation) Act, 1956?
Contracts for or relating to the purchase or sale of securities
What is meant by 'corporatisation' under the Securities Contracts (Regulation) Act, 1956?
The succession of a recognised stock exchange by another stock exchange
What is a 'commodity derivative' under the Securities Contracts (Regulation) Act, 1956?
A contract for the delivery of goods as notified by the Central Government
What does 'goods' mean under the Securities Contracts (Regulation) Act, 1956?
Every kind of movable property excluding actionable claims, money and securities
When does the Securities Contracts (Regulation) Act, 1956 come into force?
On a date notified by the Central Government in the Official Gazette
What is a 'derivative' under the Securities Contracts (Regulation) Act, 1956?
All of the above
Study Notes
The Securities Contracts (Regulation) Act, 1956
Preliminary
- The Securities Contracts (Regulation) Act, 1956 is an Act to prevent undesirable transactions in securities by regulating the business of dealing therein.
- The Act extends to the whole of India and came into force on a date appointed by the Central Government.
- The Act defines various terms, including "contract", "corporatisation", "demutualisation", "derivative", "Government security", "goods", and "commodity derivative".
Definitions
- A "contract" refers to a contract for or relating to the purchase or sale of securities.
- "Corporatisation" means the succession of a recognised stock exchange by another stock exchange, being a company incorporated for the purpose of assisting, regulating or controlling the business of buying, selling or dealing in securities.
- "Demutualisation" refers to the segregation of ownership and management from the trading rights of the members of a recognised stock exchange in accordance with a scheme approved by the Securities and Exchange Board of India.
- A "derivative" includes a security derived from a debt instrument, share, loan, contract for differences, or any other form of security.
- A "Government security" means a security created and issued by the Central Government or a State Government for the purpose of raising a public loan.
- "Goods" means every kind of movable property other than actionable claims, money, and securities.
- A "commodity derivative" refers to a contract for the delivery of notified goods, which is not a ready delivery contract.
Arrangement of Sections
- The Act consists of 32 sections, divided into three parts: Preliminary, Recognised Stock Exchange, and Miscellaneous.
- The sections deal with topics such as application for recognition of stock exchanges, grant of recognition, withdrawal of recognition, powers of Central Government, and powers of recognised stock exchanges.
- The Act also provides for the establishment of Special Courts, appeal and revision, and validation of certain acts.
This quiz is based on the Securities Contracts (Regulation) Act, 1956, which deals with the regulation of securities contracts in India. It covers the preliminary sections, definitions, and interpretation of key terms.
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