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SEBI imposes penalty of Rs 3 lakh on BSE on Indus Water deal

Published on July 30, 2022
Current Context: Securities and Exchange Board of India (SEBI) imposed a penalty of Rs 3 lakh on the Bombay Stock Exchange (BSE) for its subsidiaries buying a stake in Indus Water without prior approval.
SEBI imposes penalty of Rs 3 lakh on BSE on Indus Water deal
  • SEBI examined investments made by BSE Ltd to conclude whether it is involved in activities that are not related to its activity as a stock exchange without the approval of SEBI as of March 2021.
  • SEBI in its investigation found that BIL(a separate legal entity), a wholly owned subsidiary of BSE Ltd had acquired an 8 percent stake in Indus Water Institute Ltd, which provides support to entrepreneurs in water and clean technologies.
  • SEBI also found that BSE had allegedly been involved in activities regarding the acquisition of stakes in companies like BSE technologies, Marketplace EBIX technology, BSE tech Infra, and BIL Reyson Futures.
  • In the order, SEBI said such activities are not related to the activities carried out by the exchange. According to the rule, prior approval of SEBI is required for the same.
  • SEBI said there are three instances of violation of SECC regulations(Stock Exchanges and Clearing Corporations) 2018 read with SECC regulations 2012. The fine imposed should be paid within 45 days.
  • Static Knowledge:
    • SEBI chairman - Madhabi Puri Buch
    • SEBI headquarters - Mumbai
    • SEBI was formed - on April 12, 1992
    • BSE chairman - S S Mundra
    • BSE was formed - 1875

Question: 

Q.1 SEBI imposed a penalty of ______ on the Bombay Stock Exchange (BSE) on the Indus Water deal.
a. Rs 2 lakh
b. Rs 1 lakh
c. Rs 3 lakh
d. Rs 4 lakh
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