Section 23 - Penalties - SECURITIES CONTRACTS (REGULATION) ACT, 1956

PENALTIES AND PROCEDURE Penalties. 23. (1) Any person who- (a) without reasonable excuse (the burden of proving which shall be on him) fails to comply with any requisition made under sub-section (4) of section 6; or (b) enters into any contract in contravention of any of the provisions contained in section 13 or section 16; or (c) contravenes the provisions contained in 1 [section 17 or section 17A], or section 19; or 2 [ (d) enters into any contract in derivative in contravention of section 18A or the rules made under section 30;] (e) owns or keeps a place other than that of a recognised stock exchange which is used for the purpose of entering into or performing any contracts in contravention of any of the provisions of this Act and knowingly permits such place to be used for such purposes; or (f) manages, controls, or assists in keeping any place other than that of a recognised stock exchange which is used for the purpose of entering into or performing any contracts in contravention of any of the provisions of this Act or at which contracts are recorded or adjusted or rights or liabilities arising out of contracts are adjusted, regulated or enforced in any manner whatsoever; or (g) not being a member of a recognised stock exchange or his agent authorised as such under the rules or bye-laws of such stock exchange or not being a dealer in securities licensed under section 17 wilfully represents to or induces any person to believe that contracts can be entered into or performed under this Act through him; or (h) not being a member of a recognised stock exchange or his agent authorised as such under the rules or bye-laws of such stock exchange or not being a dealer in securities licensed under section 17, canvasses, advertises or touts in any manner either for himself or on behalf of any other persons for any business connected with contracts in contravention of any of the provisions of this Act; or (i) joins, gathers or assists in gathering at any place other than the place of business specified in the bye-laws of a recognised stock exchange any person or persons for making bids or offers or for entering into or performing any contracts in contravention of any of the provisions of this Act; 3 [ shall, without prejudice to any award of penalty by the Adjudicating Officer 8 [ or the Securities and Exchange Board of India ] under this Act, on conviction, be punishable with imprisonment for a term which may extend to ten years or with fine, which may extend to twenty-five crore rupees, or with both.] (2) Any person who enters into any contract in contravention of the provisions contained in section 15 4 [ or who fails to comply with the provisions of 5 [ section 21 or section 21A] or with the orders of] or section 22 6 [or with the orders of the Securities Appellate Tribunal] 7 [shall, without prejudice to any award of penalty by the Adjudicating Officer under this Act, on conviction, be punishable with imprisonment for a term which may extend to ten years or with fine, which may extend to twenty-five crore rupees, or with both.] *********** 1 Inserted by the Securities Contracts (Regulation) Amendment Act, 2007, Sec 4, w.e.f. 28-05-2007 for section 17 . 2 Inserted by the Securities Laws (Amendment) Act, 1999, Sec 6, w.e.f. 22-02-2000. Earlier clause (d) was omitted by the Securities Laws (Amendment) Act, 1995, Sec 24, w.e.f. 25-01-1995. 3 Substituted for shall, on conviction, be punishable with imprisonment for a term which may extend to one year, or with fine, or with both by the Securities Laws (Amendment) Act, 2004, Sec 10, w.e.f.. 12-10- 2004. 4 Substituted for or who fails to comply with the orders of the Securities and Exchange Board of India under Section 21 by the Securities Laws (Amendment) Act 1995, Sec 24 w.e.f.25-01-1995.Prior to 1995, Securities and Exchange Board of India under section 21 or Central Government under section 22 were substitutes for Central Government under Section 21 or section 22 vide The Schedule, Part II of Securities and Exchange Board of India Act, 1992, w.e.f. 30-01-1992. 5 Inserted by the Securities Laws (Amendment) Act, 2004, Sec 10, w.e.f.. 12-10-2004. 6 Inserted by the Securities Laws (Second Amendment) Act, 1999, Sec 6, w.e.f. 16-12-1999. 7 Substituted for shall, on conviction, be punishable with fine which may extend to one thousand rupees by the Securities Laws (Amendment) Act, 2004, Sec 10, w.e.f.. 12-10-2004. 8. Inserted vide FINANCE ACT, 2018 w.e.f. 08-03-2019