[amp_mcq option1=”the members of the SEBI make an application to the Central Government to do so” option2=”the SEBI is unable to discharge its functions and duties imposed on it under the provisions of the SEBI Act, 1992 or it is necessary to do so in the public interest” option3=”the SEBI on its own makes an application to the Central Government to do so” option4=”the SEBI does not have the required number of members for performing the functions entrusted to it” correct=”option2″]
The correct answer is: B. the SEBI is unable to discharge its functions and duties imposed on it under the provisions of the SEBI Act, 1992 or it is necessary to do so in the public interest.
The Securities and Exchange Board of India (SEBI) is a statutory body established by the Government of India in 1992 to protect the interests of investors in securities and to promote the development of, and regulate, the securities market in India. The SEBI Act, 1992 empowers the Central Government to supersede the SEBI if it is of the opinion that the SEBI is unable to discharge its functions and duties imposed on it under the provisions of the SEBI Act, 1992 or it is necessary to do so in the public interest.
The Central Government may supersede the SEBI by an order published in the Official Gazette. The order shall specify the reasons for superseding the SEBI and the period for which it is superseded. The order shall also provide for the appointment of an administrator to manage the affairs of the SEBI during the period of supersession.
The administrator shall have the same powers and functions as the SEBI. The administrator shall also have the power to make rules and regulations for the conduct of the affairs of the SEBI during the period of supersession.
The Central Government may, at any time, by an order published in the Official Gazette, revoke the order of supersession. The order of revocation shall also specify the date on which the SEBI shall resume its functions.
The supersession of the SEBI is a serious matter and should only be resorted to in exceptional circumstances. The Central Government should only supersede the SEBI if it is satisfied that the SEBI is unable to discharge its functions and duties imposed on it under the provisions of the SEBI Act, 1992 or it is necessary to do so in the public interest.
The other options are not correct because:
- Option A is not correct because the members of the SEBI cannot make an application to the Central Government to supersede the SEBI. The Central Government has the sole discretion to decide whether or not to supersede the SEBI.
- Option C is not correct because the SEBI cannot make an application to the Central Government to supersede itself. The Central Government has the sole discretion to decide whether or not to supersede the SEBI.
- Option D is not correct because the SEBI does not have the required number of members for performing the functions entrusted to it. The SEBI can continue to perform its functions even if it does not have the required number of members.