Powers of Central Government (SEBI) over Stock exchanges

Central Government (Securities and Exchange Board of India) exercise the following powers over stock exchanges.

1. Periodical Returns: All recognized stock exchanges have to submit periodical returns with regard to its activities to SEBI.

2. Preservation of Books of Accounts: Books of Accounts, for a period of 5 years have to be preserved by members as well as Stock exchanges.

3. The Books of Accounts can be inspected by SEBI at any time.

4. Any information can be sought: SEBI can call for additional information or explanation from any stock exchange or any member with regard to any matter.

5. SEBI can appoint one or more persons for making enquiry regarding the affairs of the governing body of stock exchange or any member of the stock exchange and submit a report within the specified time.

6. During such enquiry, every individual in the stock exchange will have to submit documents pertaining to the stock exchange and furnish whatever information called for.

7. Stock exchanges should furnish a copy of its annual report to SEBI.

8. Restriction of voting rights: Any restrictions imposed on the voting rights of the members or any regulation in the voting rights or any restriction in the right of any member by the Stock exchange will be valid only when it is approved by SEBI.

9. SEBI can direct all or any particular stock exchanges to make rules or amend rules after an inquiry being conducted on the affairs of the stock exchange.

10. When a stock exchange fails to comply with the orders of SEBI, then the government may stipulate time for complying with the conditions.

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