Lok Sabha Question No. 1634 (UNSTARRED), answered on 2016-11-25
Subject: Violation of Trading Rules
Ministry: CORPORATE AFFAIRS
Asked by: Richard Hay

## GOVERNMENT OF INDIA MINISTRY OF CORPORATE AFFAIRS

## LOK SABHA UNSTARRED QUESTION NO. 1634 ANSWERED ON FRIDAY THE 25TH NOVEMBER, 2016 [AGRAHAYANA 4, 1938(SAKA)]

## VIOLATION OF TRADING RULES

## QUESTION

1634.  PROF. RICHARD HAY:

Will the Minister of CORPORATE AFFAIRS be pleased to state:

कारपोरेट कार्य मंत्री

- (a) the number of cases of violation of Trading Rules during each of the last three  years and the current year, State/UT- wise;
- (b) the number of cases which have been investigated and the number of cases still pending during the said period;
- (c) whether  the Government  has  imposed  any  penalty on the companies which have violated the Trading Rules; and
- (d) if  so,  the  details  of  the  recovery  made  as  penalty  by  these companies?

## ANSWER

THE MINISTER OF STATE IN THE MINISTRY OF CORPORATE AFFAIRS    (SHRI ARJUN RAM MEGHWAL) कारपोरेट कार्य मंत्रालर् में राज्र् मंत्री ( श्री अर्जयन राम मेघवाल )

(a) to (d) The  Ministry  of  Corporate  Affairs  does  not  administer  any Trading Rules under the following laws which are dealt with by the Ministry: -

(i)  Companies Act, 2013 and those provisions of Companies Act, 1956 which  are  still  in  force    (ii)  The  Competition  Act,  2002  (iii)  Limited Liability Partnership Act, 2008 (iv) The Chartered Accountants Act, 1949

- (v)  The  Cost  and  Works  Accountants  Act,  1959  (vi)  The  Company Secretaries Act, 1980.

--2/-

The Department of Industrial Policy & Promotion has stated that the Foreign Direct Investment (FDI) policy formulated by it includes inter-alia trading. Any violation of FDI regulations is covered by the penal provision of the Foreign Exchange Management Act (FEMA) 1999. Reserve Bank of India (RBI) administers the FEMA and Directorate of Enforcement under Ministry of Finance is the authority for enforcement of FEMA.  The Department of Economic Affairs has stated that Securities and Exchange Board of India (SEBI) investigates alleged or suspected violations of laws and Regulations relating to the securities market.  Details of cases during each of last three years and the current year are as follows: -

| Year(s)                     |   No of cases taken up for investigation |   No of investigations completed(*) |
|-----------------------------|------------------------------------------|-------------------------------------|
| 2013-14                     |                                      108 |                                 120 |
| 2014-15                     |                                       70 |                                 122 |
| 2015-16                     |                                      133 |                                 123 |
| 2016-17 (upto Sep.30, 2016) |                                      192 |                                  55 |

- (*)  the  investigations  completed  during  a  year  may  relate  to  cases taken up during previous years.

## Details of adjudication orders passed during the last three financial years are as below:

| Particulars   | 2015-16         | 2015-16        | 2014-15              | 2013-14              |
|---------------|-----------------|----------------|----------------------|----------------------|
|               | No. of entities | No. of matters | No. of orders passed | No. of orders passed |
| Orders Passed | 893             | 425            | 1211                 | 619                  |

Total amount recovered pursuant to initiation of recovery proceedings in last three years is as follows:

| Particulars      | 2015-16          | 2014-15        | 2013-14      |
|------------------|------------------|----------------|--------------|
| Amount Recovered | Rs. 224.6 Crores | Rs.19.2 Crores | Rs7.8 crores |

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