KAMLESH KUMAR Vs. JAIPUR STOCK EXCHANGE LTD

JUDGEMENT

(1.) IN these writ petitions filed by the petitioners in the above mentioned writ petitions it has been inter alia claimed that certain conditions in the application form for enrolment as member of M/s. Jaipur Stock Exchange Ltd. non-petitioner No. 1, are arbitrary and illegal. Further grievances of the petitioners are regarding the constitution of Screening Committee and that enrolment of 200 members before the recognition of non-petitioner No. 1 is also illegal and should be quashed.

(2.) JAIPUR Stock Exchange Ltd. is a Company registered under the Indian Companies Act. A press advertisement was issued in the year 1983-84 by which the non-petitioner No. l invited applications initially for enrolment of 200 members but in response to the same 1300 applications were received. In view of large number of applications it is stated by non-petitioner No. 1 that Central Government nominated a Screening Committee which scruitinised all applications and approved 316 applications. The Managing Committee of the non-petitioner No. 1 approved the names of 182 persons in November, 1985 and 18 persons were Directors and in this way the membership of 200 was approved.

(3.) IT may be pointed out that Stock Exchanges are recognised by the Central Government in exercise of its powers conferred upon it under section 4 of the Securities Contracts (Regulation) Act, 1956 (hereinafter referred to as 'the Act')- The non-petitioner Company submitted an application under Section 3 of the Act for recognition which was granted to it under Section 4 of the Act from January 9, 1989 for a period of one year. A form has been prescribed under the Securities Contracts (Regulation) -Rules, 1957 (hereinafter referred to as 'the Rules'), wherein it is prescribed in Column 6 that it has to be mentioned in the said application the number of members at the time of making the applica-tion. Therefore, the contention of the petitioners that no members could be made before the recognition was granted to the non-petitioner No. 1 has no force. In Column 8 of the form there is mention regarding minimum qualifications and experience before enrolling new members. In column 7 there is mention regarding the limit of the number of members proposed to be enrolled. Under Sec. 5 of the Act it is provided that if the Central Government is of the opinion that the recognition granted to the Stock Exchange, in the interest of trade/public interest, be withdrawn, it can do so after serving notice and giving opportunity of hearing in this respect. Section 6 of the Act empowers the Central Government to make any enquiry in the prescribed manner relating to the affairs of the governing body of the Stock-Exchanges or any member thereof. Thus, in short it can be said that under the Act and the Rules framed there under Central Government has powers to keep complete control over the work of the Stock Exchange which have been recognized in the country.