NEW DELHI, January 20: With the renewal of recognition to National Stock Exchange (NSE) coming up in may this year, Association of NSE Members of India (ANMI) has alleged that the exchange is violating provisions of the Securities Contract Regulation Act (SCRA) by denying its members voting rights."The exchange has been violating the SCRA, 1956 and the renewal of the recognition should not be allowed by the government till exchange complies with the act," said alternate President, ANMI, V D Aggarwal.
The government had given recognition to NSE for five years -- till May 1998 -- and the exchange will have to approach the government for renewal of its recognition. Aggarwal said NSE is violating section 7(a) of SCRA, which provides for voting rights to the members of the exchange, without prior permission of the government.
NSE uses the term "trading members" while giving permission to persons or corporates to trade on the exchange and defines them as members of the exchange. However, the article of
Association of National Stock Exchange of India Ltd says trading members of the exchange shall not have any right as the member of the company, under which the exchange functions.
"The provision set by NSE for its members has hit the foundation of SCRA, 1956 and completely violates the act" Aggarwal said. He further said that the bye-laws of NSE are completely different from 21 other recognised exchanges in the country.
Copyright © 1998 Indian Express Newspapers (Bombay) Ltd.
