Mumbai, Apr 17 (UNI) The Securities and Exchange Board of India (SEBI) today struck down as ultra-vires a resolution passed by members of the Coimbatore Stock Exchange Ltd. (CSX) for voluntary surrender of recognition granted to the exchange by SEBI.
The order was passed by Mr. G. Anantharaman, whole-time member, SEBI, today.
The CSX resolution also stated that the exchange would cease to function with immediate effect as a recognised stock exchange within the scope and meaning of the Securities Contracts (Regulation) Act, 1956, (SCRA) and the SEBI Act 1992.
A release here today stated that SEBI, after examining the issue, had advised CSX through its letter of March 17, 2006, that the resolution passed in the exchange's EGM on February 15, 2006, could not be acted upon as it was ultra-vires the SCRA.
The release noted that despite SEBI's letter, the CSX members passed a resolution adopting a new set of Memorandum and Articles of Association, according to which no person other than a member of the exchange could hold the position of a director.
Consequently, the public representative directors and the SEBI nominee director do not find a place in the said Articles of Association, stated the release.
SEBI has, therefore, passed the order directing CSX to refrain from taking any action pursuant to the resolutions passed at the EGM held on February 15 and March 31, 2006, and any other decisions that might have been taken without the participation of the public representative directors or the SEBI nominee director after the EGM dated February 15, 2006.
SEBI has also directed CSX to refrain from transferring or alienating any movable or immovable property of the exchange in any manner whatsoever, till further orders.
The CSX has also been directed not to do anything which would have the effect of or which is likely to have the effect of altering the basic contours of the exchange as well as the character of the exchange, said the release.
Pending hearing and final decision on the matter, the day-to-day functioning of the exchange will be undertaken by a three-member committee consisting of Mr V. Selvaraj, SEBI nominee director/ROC, who will be the member-chairman of the said committee and Mr C. A.
Venkatesan and Mr K. R. Raman, public representative directors.
UNI JJ PP VKG2130