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Critical Analysis of Securities Law (Ammendment) Act
Authors: Kritika Bhargava
Number of views: 739
The need for a separate Securities Laws Act was felt by the government against the backdrop of lakhs of small
investors being duped by numerous fraudulent investment schemes across the country, like in the alleged Saradha scam in
West Bengal. For this, government promulgated first ordinance related to it in July 2013. The ordinance sought to grant these
additional powers to SEBI. The ordinance was promulgated for second time in September 2013 and for third time in January
2014. But all the time bill failed to be passed in Parliament. The bill proposes to amend the SEBI Act, 1992, Securities
Contracts (Regulation) Act, 1956, and the Depositories Act, 1996. It empowers SEBI to regulate any pooling of funds of Rs 100
crore and above, that are not overseen by any regulator under law; conduct search-and-seizure operations on any suspected
securities law violator's premises after obtaining permission from a magistrate or judge of a court in Mumbai (the initial
ordinance had empowered the SEBI chairman to authorize such operations and had removed the need for seeking judicial
permission), recover monetary penalties imposed by it through attachment and sale of assets, arrest and detain an individual
for any failure to comply with its orders, call for information and records from any person, including banks or other authority,
to aid its investigation, establish special courts for speedy trials of offences under the SEBI Act, re-examine an adjudicating
officer's orders and raise the penalty amount if it is in the interest of the securities market and enter into agreements for
exchange of information with foreign financial regulators. The author will use doctrinal method of research for this article.
The author will highlight some of the main amendments in Securities law amendment bill 2014.