27. Title to dividends.—(1) It shall be lawful for the holder of any security whose name appears on
the books of the company issuing the said security to receive and retain any dividend declared by the
company in respect thereof for any year, notwithstanding that the said security has already been
transferred by him for consideration, unless the transferee who claims the dividend from the transferor has
lodged the security and all other documents relating to the transfer which may be required by the
company with the company for being registered in his name within fifteen days of the date on which the
dividend became due.
Explanation. — The period specified in this section shall be extended—
(i) in case of death of the transferee, by the actual period taken by his legal representative to
establish his claim to the dividend;
(ii) in case of loss of transfer deed by theft or any other cause beyond the control of
the transferee, by the actual period taken for the replacement thereof; and
(iii) in case of delay in the lodging of any security and other documents relating to the transfer
due to causes connected with the post, by the actual period of the delay.
(2) Nothing contained in sub-section (1) shall affect—
(a) the right of a company to pay the dividend which has become due to any person whose
name is for the time being registered in the books of the company as the holder of the security in
respect of which the dividend has become due; or
(b) the right of the transferee of any security to enforce against the transferor or any other
person his rights, if any, in relation to the transfer in any case, where the company has refused to
register the transfer of the security in the name of the transferee.
1
[27A. Right to receive income from collective investment scheme.—(1) It shall be lawful for the
holder of any securities, being units or other instruments issued by the collective investment scheme,
whose name appears on the books of the collective investment scheme issuing the said security to receive
and retain any income in respect of units or other instruments issued by the collective investment scheme
declared by the collective investment scheme in respect thereof for any year, notwithstanding that the said
security, being units or other instruments issued by the collective investment scheme, has already been
transferred by him for consideration, unless the transferee who claims the income in respect of units or
other instruments issued by the collective investment scheme from the transfer or has lodged the security
and all other documents relating to the transfer which may be required by the collective investment
scheme with the collective investment scheme for being registered in his name within fifteen days of the
date on which the income in respect of units or other instruments issued by the collective investment
scheme became due.
1. Ins. by Act 31 of 1999, s. 8 (w.e.f. 22-2-2000).
29
Explanation.—The period specified in this section shall be extended—
(i) in case of death of the transferee, by the actual period taken by his legal representative to
establish his claim to the income in respect of units or other instrument issued by the collective
investment scheme;
(ii) in case of loss of the transfer deed by theft or any other cause beyond the control of the
transferee, by the actual period taken for the replacement thereof; and
(iii) in case of delay in the lodging of any security, being units or other instruments issued by the
collective investment scheme, and other documents relating to the transfer due to causes connected
with the post, by the actual period of the delay.
(2) Nothing contained in sub-section (1) shall affect—
(a) the right of a collective investment scheme to pay any income from units or other instruments
issued by the collective investment scheme which has become due to any person whose name is for
the time being registered in the books of the collective investment scheme as the holder of the
security being units or other instruments issued by the collective investment scheme in respect of
which the income in respect of units or other instruments issued by the collective scheme has become
due; or
(b) the right of transferee of any security, being units or other instruments issued by the collective
investment scheme, to enforce against the transferor or any other person his rights, if any, in relation
to the transfer in any case where the company has refused to register the transfer of the security being
units or other instruments issued by the collective investment scheme in the name of the transferee.]
1
[27B. Right to receive income from mutual fund.—(1) It shall be lawful for the holder of any
securities, being units or other instruments issued by any mutual fund, whose name appears on the books
of the mutual fund issuing the said security to receive and retain any income in respect of units or other
instruments issued by the mutual fund declared by the mutual fund in respect thereof for any year,
notwithstanding that the said security, being units or other instruments issued by the mutual fund, has
already been transferred by him for consideration, unless the transferee who claims the income in respect
of units or other instruments issued by the mutual fund from the transferor has lodged the security and all
other documents relating to the transfer which may be required by the mutual fund with the mutual fund
for being registered in his name within fifteen days of the date on which the income in respect of units or
other instruments issued by the mutual fund became due.
Explanation.—The period specified in this section shall be extended—
(i) in case of death of the transferee, by the actual period taken by his legal representative to
establish his claim to the income in respect of units or other instrument issued by the mutual fund;
(ii) in case of loss of the transfer deed by theft or any other cause beyond the control of transferee,
by the actual period taken for the replacement thereof;
(iii) in case of delay in the lodging of any security, being units or other instruments issued by the
mutual fund, and other documents relating to the transfer due to causes connected with the post, by
the actual period of the delay.
(2) Nothing contained in sub-section (1) shall affect—
(a) the right of a mutual fund to pay any income from units or other instruments issued by the
mutual fund which has become due to any person, whose name is for the time being registered in the
books of the mutual fund as the holder of the security being units or other instruments issued by the
mutual fund in respect of which the income in respect of units or other instruments issued by mutual
fund has become due; or
(b) the right of transferee of any security, being units or other instruments issued by the mutual
fund, to enforce against the transferor or any other person, his rights, if any, in relation to the transfer
1. Ins. by Act 1 of 2005, s. 14 (w.e.f. 12-10-2004).
30
in any case where the mutual fund has refused to register the transfer of the security being units or
other instruments issued by the mutual fund in the name of the transferee.]
1
[28.Act not to apply in certain cases.—(1) The provisions of this Act shall not apply to—
(a)theGovernment, the Reserve Bank of India, any local authority or any corporation set up by a
special law or any person who has effected any transaction with or through the agency of any such
authority as is referred to in this clause;
(b) any convertible bond or share warrant or any option or right in relation thereto, in so far as it
entitles the person in whose favour any of the foregoing has been issued to obtain at his option from
the company or other body corporate issuing the same or from any of its shareholders or duly
appointed agents shares of the company or other body corporate whether by conversion of the bond or
warrant or otherwise, on the basis of the price agreed upon when the same was issued.
(2)Without prejudice to the provisions contained in sub-section (1),if the Central Government is
satisfied that in the interests of trade and commerce or the economic development of the country it is
necessary or expedient so to do, it may, by notification in the Official Gazette, specify any class of
contracts as contracts to which this Act or any provision contained therein shall not apply, and also the
conditions, limitations or restrictions, if any, subject to which it shall not so apply.]
29. Protection of action taken in good faith.—No suit, prosecution or other legal proceeding
whatsoever shall lie in any court against the governing body or any member, office bearer or servant of
any recognised stock exchange or against any person or persons appointed under sub-section (1) of
section 11 for anything which is in good faith done or intended to be done in pursuance of this Act or of
any rules or bye-laws made thereunder.
2
[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 andsubjectto 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 1034).]
3
[29B. Powers of the Securities and Exchange Board of India not to apply to International
Financial Services Centre.—Notwithstanding anything contained in any other law for the time being in
force, the powers exercisable by the Securities and Exchange Board of India under this Act,—
(a) shall not extend to an International Financial Services Centre set up under sub-section (1)
of section18 of the Special Economic Zones Act, 2005 (28 of 2005);
(b) shall be exercisable by the International Financial Services Centres Authority established
under sub-section (1) of section 4 of the International Financial Services Centres Authority Act,
2019,
in so far as regulation of financial products, financial services and financial institutions that are permitted
in the International Financial Services Centres are concerned.]
30. Power to make rules.—(1) The Central Government may, by notification in the Official Gazette,
make rules for the purpose of carrying into effect the objects of this Act.
(2) In particular, and without prejudice to the generality of the foregoing power, such rules may
provide for,—
(a) the manner in which applications may be made, the particulars which they should contain and
the levy of a fee in respect of such applications;
(b) the manner in which any inquiry for the purpose of recognising any stock exchange may be
made, the conditions which may be imposed for the grant of such recognition, including conditions as
1. Subs. by Act 49 of 1959, s. 3, for section 28 (w.e.f. 8-12-1959).
2. Subs. by Act 31 of 1999, s. 9, for section 29A (w.e.f. 22-2-2000).
3. Ins. by Act 50 of 2019, s. 33 and the second Schedule (w.e.f. 1-10-2020).
31
to the admission of members if the stock exchange concerned is to be the only recognised stock
exchange in the area; and the form in which such recognition shall be granted;
(c) the particulars which should be contained in the periodical returns and annual reports to be
furnished to the Central Government;
(d) the documents which should be maintained and preserved under section 6 and the periods for
which they should be preserved;
(e) the manner in which any inquiry by the governing body of a stock exchange shall be made
under section 6;
(f) the manner in which the bye-laws to be made or amended under this Act shall before being so
made or amended be published for criticism;
(g) the manner in which applications may be made by dealers in securities for licenses under
section 17, the fee payable in respect thereof and the period of such licences, the condition subject to
which licences may be granted, including condition relating to the forms which may be used in
making contracts, or documents to be maintained by licensed dealers and the furnishing of periodical
information to such authority as may be specified and the revocation of licences for breach of
conditions;
1
[(h) the requirements which shall be complied with—
(A) by public companies for the purpose of getting their securities listed on any stock
exchange;
(B) by collective investment scheme for the purpose of getting their units listed on any stock
exchange.]
2
[(ha) the grounds on which the securities of a company may be delisted from any recognised
stock exchange under sub-section (1) of section 21A;
(hb) the form in which an appeal may be filed before the Securities Appellate Tribunal under subsection (2) of section 21A and the fees payable in respect of such appeal;
(hc) the form in which an appeal may be filed before the Securities Appellate Tribunal under
section 22A and the fees payable in respect of such appeal;
(hd) the manner of inquiry under sub-section (1) of section 23-I;
(he) the form in which an appeal may be filed before the Securities Appellate Tribunal under
section 23L and the fees payable in respect of such appeal;]
(i) any other matter which is to be or may be prescribed.
3
[(3) Every rule made under this Act shall be laid, as soon as may be after it is made, before each
House of Parliament, while it is in session, for a total period of thirty days which may be comprised in
one session or in two or more successive sessions, and if, before the expiry of the session immediately
following the session or the successive sessions aforesaid, both Houses agree in making any modification
in the rule or both Houses agree that the rule should not be made, the rule shall thereafter have effect only
in such modified form or be of no effect, as the case may be; so, however, that any such modification or
annulment shall be without prejudice to the validity of anything previously done under that rule.
4
[30A. Special provisions related to commodity derivatives.—(1) Nothing contained in this Act
shall apply to non-transferable specific delivery contracts:
Provided that no person shall organise or assist in organising or be a member of any association in
any area to which the provisions of section 13 have been made applicable (other than a stock exchange)
1 Subs. by Act 31 of 1999, s. 10, ibid., for clause (h) (w.e.f. 22-2-2000).
2. Subs. by Act 1 of 2005, s. 15, for clause (ha) (w.e.f.12-10-2004).
3. Subs. by s. 15, ibid., for sub-section (3) (w.e.f. 12-10-2004).
4. Ins. by Act 20 of 2015, s. 134 (w.e.f. 14-5-2015).
32
which provides facilities for the performance of any non-transferable specific delivery contract by any
party thereto without having to make or receive actual delivery to or from the other party to the contract
or to or from any other party named in the contract.
(2) Where in respect of any area, the provisions of section 13 have been made applicable in relation to
commodity derivatives for the sale or purchase of any goods or class of goods, the Central Government
may, by notification, declare that in the said area or any part thereof as may be specified in the
notification all or any of the provisions of this Act shall not apply to transferable specific delivery
contracts for the sale or purchase of the said goods or class of goods either generally, or to any class of
such contracts in particular.
(3) Notwithstanding anything contained in sub-section (1), if the Central Government is of the
opinion that in the interest of the trade or in the public interest it is expedient to regulate and control nontransferable specific delivery contracts in any area, it may, by notification in the Official Gazette, declare
that all or any of the provisions of this Act shall apply to such class or classes of non-transferable specific
delivery contracts in such area in respect of such goods or class of goods as may be specified in the
notification, and may also specify the manner in which and the extent to which all or any of the said
provisions shall so apply.]
1
[30B. Special provisions related to pooled investment vehicle.—(1) Notwithstanding anything
contained in the Indian Trust Act, 1882 (2 of 1882) or in any other law for the time being in force or in
any judgment, decree or order of any Court, Tribunal or any other authority, a pooled investment vehicle,
whether constituted as a trust or otherwise, and registered with the Securities and Exchange Board of
India shall be eligible to borrow and issue debt securities in such manner and to such extent as may be
specified under the regulations made by Securities and Exchange Board of India in this behalf.
(2) Every pooled investment vehicle referred to in sub-section (1) shall, subject to the provisions of
the trust deed, be permitted to provide security interest to lenders in terms of the facility documents
entered into by such pooled investment vehicle.
(3) Where any pooled investment vehicle referred to in sub-section (1) defaults in repayment of
principal amount or payment of interest or any such amount due to the lender, the lender shall recover the
defaulted amount and enforce security interest, if any, against the trust assets, by initiating proceedings
against the trustee acting on behalf of such pooled investment vehicle in accordance with the terms and
conditions specified in the facility documents:
Provided that on initiation of the proceedings against the trust assets, the trustee shall not be
personally liable and his assets shall not be utilised towards recovery of such debt.
(4) The trust assets, which remain after recovery of defaulted amount, shall be remitted to the unit
holders on proportionate basis.]
2
[31.Power of Securities and Exchange Board of India to make regulations.—(1) Without
prejudice to the provisions contained in section 30 of the Securities and Exchange Board of India Act,
1992, the Securities and Exchange Board of India, may, by notification in the Official Gazette, make
regulations consistent with the provisions of this Act and the rules made thereunder to carry out the
purposes of this Act.
3
[(2) In particular, and without prejudice to the generality of the foregoing power, such regulations
may provide for all or any of the following matters, namely:—
(a) the manner, in which at least fifty-one per cent.of equity share capital of a recognised stock
exchange is held within twelve months from the date of publication of the order under sub-section (7)
of section 4B by the public other than the shareholders having trading rights under sub-section (8) of
that section;
(b) the eligibility criteria and other requirements under section 17A.]
1. Ins. by Act 13 of 2021, s. 149 (w.e.f. 1-4-2021).
2. Ins. by Act 1 of 2005, s. 16 (w.e.f. 12-10-2004).
3. Subs. by Act 27 of 2007, s. 5, for sub-section (2) (w.e.f. 28-5-2007).
33
1
[(c) the terms determined by the Board for settlement of proceedings under sub-section (2) of
section 23JA;
(d) any other matter which is required to be, or may be, specified by regulations or in respect of
which provision is to be made by regulations.]
(3) Every regulation made under this Act shall be laid, as soon as may be after it is made, before each
House of Parliament, while it is in session for a total period of thirty days which may be comprised in one
session or in two or more successive sessions, and if, before the expiry of the session immediately
following the session or the successive sessions aforesaid, both Houses agree in making any modification
in the regulation or both Houses agree that the regulation should not be made, the regulation shall
thereafter have effect only in such modified form or be of no effect, as the case may be; so, however, that
any such modification or annulment shall be without prejudice to the validity of anything previously done
under that regulation.]
2
[32. Validation of certain acts.—Any act or thing done or purporting to have been done under the
principal Act, in respect of settlement of administrative and civil proceedings, shall, for all purposes, be
deemed to be valid and effective as if the amendments made to the principal Act had been in force at all
material times.]