Section 29A of The Securities Contracts (Regulation) Act, 1956
1[29A. power to delegate.--The Central Government may, by order published in the Official Gazette, direct that the powers (except the power under section 30) exercisable by it under any provision of this Act shall, in relation to such matters and subject to such conditions, if any, as may be specified in the order, be exercisable also by the Securities and Exchange Board of India or the Reserve Bank of India constituted under section 3 of the Reserve Bank of India Act, 1934 (2 of 1934).]
Summary
- Under Section 29A, the Central Government has the authority to delegate (hand over or assign) its statutory powers under the Act to other key regulators.
- The Central Government may delegate its powers to either the Securities and Exchange Board of India (SEBI) or the Reserve Bank of India (RBI).
- The delegation must be executed by an order published in the Official Gazette.
- The delegation order can specify the particular matters and impose any conditions, limitations, or restrictions on the exercise of these delegated powers.
- The Central Government is strictly prohibited from delegating its rule-making power under Section 30 of this Act.
- Other powers, such as processing applications for stock exchange recognition under Section 3, can be delegated to SEBI or RBI.
Practical examples
FAQ
1. Which regulatory bodies can the Central Government delegate its powers to under Section 29A?
The Central Government can delegate its powers under the Act to either the Securities and Exchange Board of India (SEBI) or the Reserve Bank of India (RBI).
2. How must the Central Government authorize the delegation of its powers?
The delegation must be authorized by an order issued and published by the Central Government in the Official Gazette.
3. Is there any power that the Central Government is strictly forbidden from delegating under Section 29A?
Yes, the Central Government cannot delegate its power to make rules under Section 30 of the Act.
4. Can the Central Government impose conditions on how SEBI or the RBI exercises delegated powers?
Yes, the delegation order published in the Official Gazette can specify particular matters and subject the exercise of powers to any conditions or restrictions the Central Government deems necessary.
Test yourself
Q1.Under Section 29A of The Securities Contracts (Regulation) Act, 1956, which of the following powers is the Central Government explicitly prohibited from delegating?
Q2.Under Section 29A of The Securities Contracts (Regulation) Act, 1956, to which institutions can the Central Government delegate its exercisable powers?
Q3.How must the Central Government execute a delegation of power under Section 29A of The Securities Contracts (Regulation) Act, 1956?
Q4.Under Section 29A of The Securities Contracts (Regulation) Act, 1956, if the Central Government delegates its powers under Section 3 (concerning applications for stock exchange recognition), which of the following is true?