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The organisation, management, membership and functioning of stock exchanges in India are governed by the provisions of:
  • a)
    The Securities Contracts (Regulation) Act, 1956.
  • b)
    The Securities Council (Regulation) Act, 1956.
  • c)
    The Securities Contracts (Regulation) Act, 1965.
  • d)
    The Securities Council (Regulation) Act, 1965.
Correct answer is option 'A'. Can you explain this answer?
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The organisation, management, membership and functioning of stock exch...
The organisation, management, membership and functioning of stock exchanges in India are governed by the provisions of The Securities Contracts (Regulation) Act, 1956.
This Act permits only recognized stock exchanges to function under the rules, regulations and by laws approved by the Central Government. At present there are 24 stock exchange in India.
The stock exchanges of India have the following organisational form:
  • Voluntary non-profit making associations
  • Public limited company
  • Company limited by guarantee
The governing body is responsible for policy formulation and proper functioning of the exchange, having wide range of powers viz.
  • Elect the office bearers and set up committees
  • Admit and expel members
  • Manage the properties and finance of the exchange
  • Interpret rules, regulations and by-laws
  • Adjudicate disputes
  • Conduct the affairs of the exchange
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The organisation, management, membership and functioning of stock exch...
The correct answer is option 'A', which states that the organization, management, membership, and functioning of stock exchanges in India are governed by the provisions of The Securities Contracts (Regulation) Act, 1956.

Explanation:

The Securities Contracts (Regulation) Act, 1956 (SCRA) is the main legislation that governs the functioning and regulation of stock exchanges in India. It was enacted to regulate the securities market and protect the interests of investors. The SCRA provides a legal framework for the establishment, recognition, and regulation of stock exchanges in India.

1. Organization of Stock Exchanges:
- The SCRA lays down the rules and regulations regarding the organization and establishment of stock exchanges in India.
- It specifies the requirements for the recognition of a stock exchange by the Securities and Exchange Board of India (SEBI), the regulatory authority for the securities market in India.

2. Management of Stock Exchanges:
- The SCRA defines the powers and functions of the governing bodies of stock exchanges, such as the board of directors and the governing council.
- It sets out the rules for the appointment and removal of key management personnel, such as the chairman, managing director, and chief executive officer.

3. Membership of Stock Exchanges:
- The SCRA establishes the eligibility criteria for membership of a stock exchange.
- It specifies the qualifications, standards, and conditions that an individual or a corporate entity must meet to become a member of a stock exchange.

4. Functioning of Stock Exchanges:
- The SCRA outlines the rules and regulations governing the trading, clearing, and settlement of securities on stock exchanges.
- It sets out the obligations and responsibilities of stock exchange members, including brokers and traders.
- The SCRA also provides provisions for the prevention of fraudulent and unfair trade practices, market manipulation, and insider trading.

In addition to the SCRA, the functioning of stock exchanges in India is also regulated by SEBI, which has the power to issue regulations, guidelines, and directions for the orderly conduct of trading and to protect the interests of investors.

In conclusion, the provisions of The Securities Contracts (Regulation) Act, 1956 govern the organization, management, membership, and functioning of stock exchanges in India. The SCRA provides a legal framework for the establishment and regulation of stock exchanges, ensuring transparency, fairness, and investor protection in the securities market.
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Direction: Read the following text and answer the below questions :Radio XYZ is a company which has improved its functioning by proper management. The company has been good in deciding and completing targets. In the previous meeting, it was decided that in coming years, company could show increase in the number of workers, number of products produced and also the sales turnover. However, recently it earned a negative reputation under the impact of resignations put forth by two of its departmental heads. These departmental heads were experts in their fields. One was leading the marketing department and the other was a scientist of repute who headed the manufacturing department. In the top-level management meeting it was found that such departmental heads who were specialists in their areas cannot be tackled by unity of command. They were egoistic as they were specialists.After the meeting, things started to change for the organisation as all the departments started to work with one single target of giving back the company its lost fame. There was a combined effort which doubled the revenue of the organisation. A special regulation system of including every level manager was brought into action. Thus, the overall functioning of the organization improved.“…company could show increase in the number of workers, number of products produced and also the sales turnover.” Identify the type of objective being discussed.

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The organisation, management, membership and functioning of stock exchanges in India are governed by the provisions of:a)TheSecuritiesContracts(Regulation)Act, 1956.b)TheSecuritiesCouncil(Regulation)Act,1956.c)TheSecuritiesContracts(Regulation)Act,1965.d)TheSecuritiesCouncil(Regulation)Act,1965.Correct answer is option 'A'. Can you explain this answer?
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