Any stock exchange, which is desirous of being recognized for the purposes of this Act, may make an application in the prescribed manner to SEBI (Section 3). The application shall be filed in the prescribed format along with copies of the byelaws and rules of the stock exchange.
If SEBI and Central Government are satisfied, after making such inquiry as may be necessary in this behalf and after obtaining such further information, if any, as it may require, it may grant recognition to the stock exchange subject to the conditions relating to:
(i) The qualifications for membership of stock exchanges,
(ii) The manner in which contracts shall be entered into and enforced as between members,
(iii) The representation of SEBI on each of the stock exchanges by such number of persons not exceeding three as SEBI may nominate in this behalf; and
(iv) The maintenance of accounts of members and their audit by chartered accountants whenever such audit is required by SEBI.
If SEBI and Central Government are satisfied, after making such inquiry as may be necessary in this behalf and after obtaining such further information, if any, as it may require, it may grant recognition to the stock exchange subject to the conditions relating to:
(i) The qualifications for membership of stock exchanges,
(ii) The manner in which contracts shall be entered into and enforced as between members,
(iii) The representation of SEBI on each of the stock exchanges by such number of persons not exceeding three as SEBI may nominate in this behalf; and
(iv) The maintenance of accounts of members and their audit by chartered accountants whenever such audit is required by SEBI.
