GOVERNMENT OF KERALA

Law (Leg.-Publication) Department

NOTIFICATION

No. 18077/Leg.Pbn.2/2013/Law.

Dated, Thiruvananthapuram, 16th August 2013.

The following Ordinance promulgated by the President and published in

the Gazette of India Extraordinary, Part II, Section 1, dated the 18th July, 2013 is

hereby republished for general information.

By order of the Governor,

C. P. RAMARAJA PREMA PRASAD,

Law Secretary.

Kerala Gazette No. 41 dated 15th October 2013.

PART I

Section i

MINISTRY OF LAW AND JUSTICE

(Legislative Department)

THE SECURITIES LAWS (AMENDMENT) ORDINANCE, 2013

(NO. 8 OF 2013)

Promulgated by the President in the Sixty-fourth Year of the

Republic of India.

ORDINANCE

further to amend the Securities and Exchange Board of India Act, 1992, the

Securities Contracts (Regulation) Act, 1956 and the Depositories

Act, 1996.

WHEREAS Parliament is not in session and the President is satisfied that

the circumstances exist which render it necessary for him to take immediate

action;

NOW, THEREFORE, in exercise of the powers conferred by clause (1) of article

123 of the Constitution, the President is pleased to promulgate the following

Ordinance:—

CHAPTER I

PRELIMINARY

1. Short title and commencement.—(1) This Ordinance may be called the

Securities Laws (Amendment) Ordinance, 2013.

(2)

Save as otherwise provided in this Ordinance, the provisions of

this Ordinance shall come into force at once.

New Delhi, the 18th July, 2013 Asadha 27,1935 (Saka).

CHAPTER II

AMENDMENTS TO THE SECURITIES AND EXCHANGE

BOARD OF INDIA ACT, 1992

2. Amendment of section 11.—In section 11 of the Securities and Exchange

Board of India Act, 1992 (15 of 1992) (hereafter in this Chapter referred to as the

principal Act),—

(i) In sub-section (2),

(a) for clause (ia), the following clause shall be substituted,

namely:—

“(ia)

calling for information and records from any person

including any bank or any other authority or board or corporation

established or constituted by or under any Central or State Act

which, in the opinion of the Board, shall be relevant to any

investigation or inquiry by the Board in respect of any transaction

in securities;”;

(b)

after clause (ia) the following clause shall be inserted and

shall be deemed to have been inserted with effect from the 6th day of

March, 1998, namely:—

“(ib) calling for information from, or furnishing information

to, other authorities, whether in India or outside India, having

functions similar to those of the Board, in the matters relating to

the prevention or detection of violations in respect of securities

laws, subject to the provisions of other laws for the time being in

force in this regard:

Provided that the Board, for the purpose of furnishing any

information to any authority outside India, may enter into an

arrangement or agreement or understanding with such authority

with the prior approval of the Central Government;”;

(ii) after sub-section (4), the following sub-section shall be inserted,

namely:—

“(5) The amount disgorged pursuant to a direction issued

under section 11B or section 12 A of the Securities Contracts

(Regulation) Act, 1956 (42 of 1956) or section 19 of the

Depositories Act,1996 (22 of 1996) as the case may be, shall be

credited to the Investor Protection and Education Fund established

by the Board and such amount shall be utilised by the Board in

accordance with the regulations made under this Act.”.

3. Amendment of Section 11 AA.—In section 11 AA of the principal Act,—

(i)

in sub-section (1)—

(a) after the word, brackets and figure “sub-section (2)”, the

words, brackets, figure and letter “or sub-section (2A)” shall be inserted;

(b) the following proviso shall be inserted, namely:—

“Provided that any pooling of funds under any scheme or

arrangement, which is not registered with the Board or is not covered

under sub-section (3), involving a corpus amount of one hundred crore

rupees or more shall be deemed to be a collective investment scheme.”;

(ii)

in sub-section (2), in the opening portion, for the word “company”,

the word “person” shall be substituted;

(iii)

after sub-section (2), the following sub-section shall be inserted,

namely:—

“(2A)

Any scheme or arrangement made or offered by any

person satisfying the conditions as may be specified in accordance

with the regulations made under this Act.”;

(iv)

in sub-section (3),—

(a) after the word, brackets and figure “sub-section (2)”, the

words, brackets, figure and letter “ or sub-section (2A)” shall be

inserted;

(b) after clause (viii), the following clause shall be inserted,

namely:—

“ (ix)

such other scheme or arrangement which the Central

Government may, in consultation with the Board, notify, ”.

4. Amendment of section 11 B.—In section 11B of the principal Act, the

following Explanation shall be inserted, namely:—

“Explanation.—For the removal of doubts, it is hereby declared

that the power to issue directions under this section shall include and

always be deemed to have been included the power to direct any

person, who made profit or averted loss by indulging in any transaction

or activity in contravention of the provisions of this Act or regulations

made thereunder, to disgorge an amount equivalent to the wrongful gain

made or loss averted by such contravention.”.

5. Amendment of section 11C.—In section 11C of the principal Act,–

(i) for sub-section (8), the following sub-section shall be

substituted, namely:—

‘(8) Where in the course of an investigation, the Investigating

Authority has reason to believe that any person or enterprise, as the

case may be, to whom a notice under sub-section (3) has been issued

or might be issued,—

(a) has omitted or failed to provide the information or produce

documents as required in the notice; or

(b) would not provide the information or produce documents

which shall be useful for, or relevant to, the investigation; or

or documents useful for, or relveant to, the investigation,

then, the chaiman may, after being satisfied that it is necessary to do so,

authorise the Investigating Authority or any other officer of the Board

(the officer so authorised in all cases being hereinafter referred to as the

authorised officer), to—

(i) enter and search, with such assistance, as may be required, the

building, place, vessel, vehicle or aircraft where such information or

documents are expected or believed to be kept;

(ii) break open the lock of any door, box, locker, safe almirah or

other receptacle for exercising the powers conferred by sub-clause (i),

where the keys thereof are not available;

(iii) search any person who has got out of, or is about to get

into, or is in, the building, place, vessel, vehicle or aircraft, if the

authorised officer has reason to suspect that such person has secreted

about his person any such books of account or other documents;

(iv) require any person who is found to be in possession or

control of any books of account or other documents, maintained in the

form of electronic record, to provide the authorised officer the necessary

facility to inspect such books of account or other documents.

Explanation.—For the purposes of this sub-clause, the expression

“electronic record” shall have the meaning assigned to it in clause (t) of

sub-section(1) of section 2 of the Information Technology Act, 2000

(21 of 2000).

(v)

seize any such books of account or other documents found as

a result of such search;

(vi)

place marks of identification on any books of account or other

documents or make or cause to be made extracts or copies therefrom;

(vii) record on oath the statement of any person who is found to be

in possession or in control of the information or documents referred to

in sub-clauses (i), (iii) and (iv).”;

(ii) for sub-section (9), the following sub-section shall be substituted,

namely,—

“(9) The Board may make regulations in relation to any search or

seizure under this section; and in particular, without prejudice to the

generality of the foregoing power, such regulations may provide for

the procedure to be followed by the authorised officer—

(a) for obtaining ingress into any building, place, vessel,

vehicle or aircraft to be searched where free ingress thereto is not

available;

(b) for ensuring safe custody of any books of account or

other documents or assets seized.”;

(iii) in sub-section (10), the words “and inform the Magistrate of

such return” shall be omitted.

Insertion of new section 15JB.—After section 15JA of the

principal Act, the following section shall be inserted and shall be deemed

to have been inserted with effect from the 20th day of April, 2007,

namely:—

“15 JB. Settlement of administrative and civil proceedings.—

(1) Notwithstanding anything contained in any other law for the time

being in force, any person, against whom any proceedings have been

initiated or may be initiated under section 11, section l1B, section 11D,

sub-section (3) of section 12 or section 15-I, may file an application in

writing to the Board proposing for settlement of the proceedings initiated

or to be initiated for the alleged defaults.

(2) The Board may, after taking into consideration the nature,

gravity and impact of defaults, agree to the proposal for settlement, on

payment of such sum by the defaulter or on such other terms as may

be determined by the Board in accordance with the regulations made

under this Act.

(3) The settlement proceedings under this section shall be conducted

in accordance with the procedure specified in the regulations made under

this Act.

(4) No appeal shall lie under section 15T against any order passed by

the Board or adjudicating officer, as the case may be, under this section.”.

7. Amendment of section 15T.—In section 15T of the principal Act,

sub section (2) shall be omitted.

8. Amendment of section 26.—In section 26 of the principal Act,

sub-section (2) shall be omitted.

9. Insertion of new sections 26A, 26B, 26C, 26D and 26E.—After

section 26 of the principal Act, the following sections shall be inserted,

namely:—

“26A. Establishment of Special Courts.—(1) The Central

Government may, for the purpose of providing speedy trial of offences

under this Act, by notification, establish or designate as many Special

Courts as may be necessary.

(2) A Special Court shall consist of a single judge who shall be

appointed by the Central Government with the concurrence of the Chief

Justice of the High Court within whose jurisdiction the judge to be

appointed is working.

(3) A person shall not be qualified for appointment as a judge of a

Special Court unless he is, immediately before such appointment, holding

the office of a Sessions Judge or an Additional Sessions Judge, as the

case may be.

26B. Offences triable by Special Courts.—Notwithstanding

anything contained in the Code of Criminal Procedure, 1973 (2 of 1974),

all offences under this Act committed prior to the date of

commencement of the Securities Laws (Amendment) Ordinance, 2013 or

on or after the date of such commencement, shall be taken cognizance

of and triable by the Special Court established for the area in which the

offence is committed or where there are more Special Courts than one

for such area, by such one of them as may be specified in this behalf

by the High Court concerned.

26C. Appeal and revision.—.The High Court may exercise, so far as

may be applicable, all the powers conferred by Chapters XXIX and

XXX of the Code of Criminal Procedure, 1973 (2 of 1974) on a High

Court, as if a Special Court within the local limits of the jurisdiction of

the High Court were a Court of Session trying cases within the local

limits of the jurisdiction of the High Court.

26D. Application of Code to proceedings before Special Court.—

(1) Save as otherwise provided in this Act, the provisions of the Code

of Criminal Procedure, 1973 (2 of 1974) shall apply to the proceedings

before a Special Court and for the purposes of the said provisions, the

Special Court shall be deemed to be a Court of Session and the person

conducting prosecution before a Special Court shall be deemed to be a

Public Prosecutor within the meaning of clause (u) of section 2 of the

Code of Criminal Procedure, 1973.

(2) The person conducting prosecution referred to in sub-section

(1) should have been in practice as an Advocate for not less than

seven years or should have held a post, for a period of not less than

seven years, under the Union or a State, requiring special knowledge

of law.

26E. Transitional provisions.—Any offence committed under this

Act, which is triable by a Special Court shall, until a Special Court is

established, be tried by a Court of Session exercising jurisdiction over

the area, notwithstanding anything contained in the Code of Criminal

Procedure, 1973 (2 of 1974):

Provided that nothing contained in this section shall affect the

powers of the High Court under section 407 of the Code of Criminal

Procedure, 1973 (2 of 1974) to transfer any case or class of cases

taken cognizance by a Court of Session under this section.” .

10.

Insertion of new section 28 A.— After section 28 of the principal

Act, the following section shall be inserted, namely:—

‘28A. ‘Recovery of amounts.(1)—If a person fails to pay the penalty

imposed by the adjudicating officer or fails to comply with any direction of

the Board for refund of monies or fails to comply with a direction of

disgorgement order issued under section 11 B or fails to pay any fees due to

the Board, the Recovery Officer may draw up under his signature a statement

in the specified form specifying the amount due from the person (such

statement being hereafter in this Chapter referred to as certificate) and shall

proceed to recover from such person the amount specified in the certificate

by one or more of the following modes, namely:—

(a) attachment and sale of the person’s movable property;

(b) attachment of the person’s bank accounts;

(d) arrest of the person and his detention in prison;

(e) appointing a receiver for the management of the person’s movable

and immovable properties,

and for this purpose, the provisions of sections 221 to 227, 228A, 229, 231,

232, the Second and Third Schedules to the Income-tax Act, 1961

(43 of 1961) and the Income-tax (Certificate Proceedings) Rules, 1962, as in

force from time to time, in so far as may be, apply with necessary modifications

as if the said provisions and the rules thereunder were the provisions of

this Act and referred to the amount due under this Act instead of to income-

tax under the Income-tax Act, 1961.

Explanation 1.—For the purposes of this sub-section, the person’s

movable or immovable property or monies held in bank accounts shall

include any property or monies held in bank accounts which has been

transferred directly or indirectly on or after the date when the amount

specified in certificate had become due, by the person to his spouse or

minor child or son’s wife or son’s minor child, otherwise than for

adequate consideration, and which is held by, or stands in the name

of, any of the persons aforesaid; and so far as the movable or

immovable property or monies held in bank accounts so transferred to

his minor child or his son’s minor child is concerned, it shall, even after

the date of attainment of majority by such minor child or son’s minor

child, as the case may be, continue to be included in the person’s

movable or immovable property or monies held in bank accounts for

recovering any amount due from the person under this Act.

Explanation 2.—Any reference under the provisions of the Second

and Third Schedules to the Income-tax Act, 1961 (43 of 1961) and the

Income-tax (Certificate Proceedings) Rules, 1962 to the assessee shall

be construed as a reference to the person specified in the certificate.

Explanation 3.—Any reference to appeal in Chapter XVIID and the

Second Schedule to the Income-tax Act, 1961(43of 1961) shall be

construed as a reference to appeal before the Securities Appellate

Tribunal under section 15T of this Act.

(2)

The Recovery Officer shall be empowered to seek the assistance

of the local district administration while exercising the powers under

sub-section (1).

(3)

Notwithstanding anything contained in any other law for the

time being in force, the recovery of amounts by a Recovery Officer under

sub-section (1), pursuant to non-compliance with any direction issued

by the Board under section 11 B, shall have precedence over any other

claim against such person.

(4)

For the purpose of sub-sections (1), (2) and (3), the expression

“Recovery Officer” means any officer of the Board who may be

authorised, by general or special order in writing, to exercise the powers

of a Recovery Officer.’.

11. Amendment of section 30.—In section 30 of the principal Act, in

sub-section (2),—

(i) after clause ( c), the following clauses shall be inserted, namely:—

“( ca) the utilisation of the amount credited under sub-section (5) of

section 11;

(cb) the fulfilment of other conditions relating to collective

investment scheme under sub-section (2A) of section 11 AA;

(cc) the procedure to be followed by the authorised officer for

search or seizure under sub-section (9) of section 11 C;”;

(ii) after clause (d), the following clauses shall be inserted, namely:—

“(da) the terms determined by the Board for settlement of

proceedings under sub-section (2) and the procedure for conducting

of settlement proceedings under sub-section (3) of section 15JB;

(db) any other matter which is required to be, or may be,

specified by regulations or in respect of which provision is to be

made by regulations.”.

CHAPTER III

AMENDMENTS TO THE SECURITIES CONTRACTS

(REGULATION) ACT, 1956

12.

Amendment of section 12A.—In section 12A of the Securities

Contracts (Regulation) Act, 1956 (42 of 1956) (hereafter in this Chapter

referred to as ‘the principal Act), the following Explanation shall be inserted,

namely:—

“Explanation.—For the removal of doubts, it is hereby declared that

power to issue directions under this section shall include and always be

deemed to have been included the power to direct any person, who made

profit or averted loss by indulging in any transaction or activity in

contravention of the provisions of this Act or regulations made thereunder,

to disgorge an amount equivalent to the wrongful gain made or loss averted

by such contravention.”.

13. Insertion of new section 23JA.— After section 23J of the principal

Act, the following section shall be inserted and shall be deemed to have been

inserted with effect from the 20th day of April, 2007, namely:—

“23JA. Settlement of administrative and civil proceedings.— (1)

Notwithstanding anything contained in any other law for the time being in

force, any person, against whom any proceedings have been initiated or

may be initiated under section 12A or section 23-I, may file an application in

writing to the Board proposing for settlement of the proceedings initiated or

to be initiated for the alleged defaults.

(2) The Board may, after taking into consideration the nature, gravity and

impact of defaults, agree to the proposal for settlement, on payment of such

sum by the defaulter or on such other terms as may be determined by the

Board in accordance with the regulations made under the Securities and

Exchange Board of India Act, 1992 (15 of 1992).

(3) For the purpose of settlement under this section, the procedure as

specified by the Board under the Securities and Exchange Board of India

Act, 1992 (15 of 1992) shall apply.

(4) No appeal shall lie under section 23L, against any order passed by the

Board or the adjudicating officer, as the case may be, under this section.”.

14. Insertion of new section 23JB.—After section 23JA of the principal

Act as so inserted, the followmg section shall be inserted, namely:-

‘23JB. Recovery of amounts.—(1) If a person fails to pay the penalty

imposed by the adjudicating officer or fails to comply with a direction of

disgorgement order issued under section 12A or fails to pay any fees due

to the Board, the Recovery Officer may draw up under his signature a

statement in the specified form specifying the amount due from the person

(such statement being hereafter in this Chapter referred to as certificate)

and shall proceed to recover from such person the amount specified in the

certificate by one or more of the following modes, namely:—

(a) attachment and sale of the person’s movable property;

(b) attachment of the person’s bank accounts;

(d) arrest of the person and his detention in prison;

(e) appointing a receiver for the management of the person’s movable

and immovable properties,

and for this purpose, the provisions of sections 221 to 227, 228A, 229, 231,

232, the Second and Third Schedules to the Income-tax Act, 1961

(43 of 1961) and the Income-tax (Certificate Proceedings) Rules, 1962, as in

force from time to time, in so far as may be, apply with necessary modifications

as if the said provisions and the rules thereunder were the provisions of

this Act and referred to the amount due under this Act instead of to

income-tax under the Income-tax Act, 1961.

Explanation 1.—For the purposes of this sub-section, the

person’s movable or immovable property or monies held in bank

accounts shall include any property or monies held in bank accounts

which has been transferred, directly or indirectly on or after the date

when the amount specified in certificate had become due, by the person

to his spouse or minor child or son’s wife or son’s minor child, otherwise

than for adequate consideration, and which is held by, or stands in the

name of, any of the persons aforesaid; and so far as the movable or

immovable property or monies held in bank accounts so transferred to

his minor child or his son’s minor child is concerned, it shall, even after

the date of attainment of majority by such minor child or son’s minor

child, as the case may be, continue to be included in the person’s

movable or immovable property or monies held in bank accounts for

recovering any amount due from the person under this Act. .

Explanation 2.— Any reference under the provisions of the Second and

Third Schedules to the Income-tax Act, 1961 (43 of 1961) and the Income-tax

(Certificate Proceedings) Rules, 1962 to the assessee shall be construed as

a reference to the person specified in the certificate.

Explanation 3.—Any reference to appeal in Chapter XVIID and the

Second Schedule to the Income-tax Act, 1961 (43 of 1961) shall be construed

as a reference to appeal before the Securities Appellate Tribunal under

section 23L of this Act.

(2) The recovery officer shall be empowered to seek the assistance of

the local district administration while exercising the powers under

sub-section (1).

(3) Notwithstanding anything contained in any other law for the

time being in force, the recovery of amounts by a Recovery Officer

under sub-section (1), pursuant to non-compliance with any direction issued

by the Board under section 12A, shall have precedence over any

other claim against such person.

(4) For the purposes of sub-section (1), (2) and (3), the expression

“Recovery Officer” means any officer of the Board who may be authorised,

by general or special order in writing to exercise the powers of a Recovery

Officer.’.

15. Amendment to section 26.—In section 26 of the principal Act,

sub-section (2) shall be omitted.

16. Insertion of new sections 26A, 26 B, 26 C, 26 D, and 26 E.— After

section 26 of the principal Act, the following sections shall be inserted,

namely:—

“26A. Establishment of Special Courts.—(1) The Central Government

may, for the purpose of providing speedy trial of offences under this

Act, by notification, establish or designate as many Special Courts as

may be necessary.

(2)

A Special Court shall consist of a single judge who shall be

appointed by the Central Government with the concurrence of the Chief

Justice of the High Court within whose jurisdiction the judge to be

appointed is working.

(3)

A person shall not be qualified for appointment as a judge of a

Special Court unless he is, immediately before such appointment, holding

the office of a Sessions Judge or an Additional Sessions Judge, as the case

may be.

26B. Offences triable by Special Courts.—Notwithstanding

anything contained in the Code of Criminal Procedure, 1973 (20 of 1974)

all offences under this Act committed prior to the date of

commencement of the Securities Laws (Amendment) Ordinance, 2013 or

on or after the date of such commencement, shall be taken cognizance

of and triable by the Special Court established for the area in which

the offence is committed or where there are more Special Courts than

one for such area, by such one of them as may be specified in this

behalf by the High Court concerned.

26C. Appeal and Revision .—The High Court may exercise, so far as

may be applicable, all the powers conferred by Chapters XXIX and XXX of

the Code of Criminal Procedure, 1973 (2 of 1974) on a High Court, as if a

Special Court within the local limits of the jurisdiction of the High Court

were a Court of Session trying cases within the local limits of the jurisdiction

of the High Court.

26D. Application of code to proceedings before Special Court.—(1)

Save as otherwise provided in this Act, the provisions of the Code of Criminal

Procedure, 1973 (2 of 1974) shall apply to the proceedings before a Special

Court and for the purposes of the said provisions, the Special Court shall be

deemed to be a Court of Session and the person conducting prosecution

before a Special Court shall be deemed to be a Public Prosecutor within the

meaning of clause (u) of section 2 of the Code of Criminal Procedure, 1973.

(2) The person conducting prosecution referred to in sub-section (1)

should have been in practice as an Advocate for not less than seven years

or should have held a post, for a period of not less than seven years, under

the Union or a State, requiring special knowledge of law.

26E. Transitional provisions.—Any offence committed under this Act,

which is triable by a Special Court shall, until a Special Court is established,

be tried by a Court of Session exercising jurisdiction over the area,

notwithstanding anything contained in the Code of Criminal Procedure,

1973 (2 of 1974):

Provided that nothing contained in this section shall affect the powers

of the High Court under section 407 of the Code to transfer any case or

class of cases taken cognizance by a Court of Session under this section.”.

CHAPTER IV

AMENDMENTS TO THE DEPOSITORIES ACT, 1996

17.

Amendment of section 19.—In section 19 of the Depositories Act,

1996 (22 of 1996) (hereafter in this chapter referred to as the principal Act

in this chapter), the following Explanation shall be inserted, namely:—

“Explanation.—For the removal of doubts, it is hereby declared that

power to issue directions under this section shall include and always be

deemed to have been included the power to direct any person, who made

profit or averted loss by indulging in any transaction or activity in

contravention of the provisions of this Act or regulations made thereunder,

to disgorge an amount equivalent to the wrongful gain made or loss averted

by such contravention.”.

18. Insertion of new section 19-IA.—After section 19-I of the principal

Act, the following section shall . be inserted and shall be deemed to have

been inserted with effect from the 20th day of April, 2007, namely:—

“19-IA. Settlement of Adminstrative Civil Proceedings.—

Notwithstanding anything contained in anyother law for the time being in

force, any person, against whom any proceedings have been initiated or

may be initiated under section 19 or section 19H , as the case may be, may file

an application in writing to the Board proposing for settlement of the

proceedings initiated or to be initiated for the alleged defaults.

(2) The Board may, after taking into consideration the nature, gravity

and impact of defaults, agree to the proposal for settlement, on payment of

such sum by the defaulter or on such other terms as may be determined by

the Board in accordance with the regulations made under the Securities and

Exchange Board of India Act, 1992 (15 of 1992).

(3) For the purpose of settlement under this section, the procedure as

specified by the Board under the Securities and Exchange Board of India

Act, 1992 (15 of 1992) shall apply.

(4) No appeal shall lie under section 23A against any order passed by

the Board or the adjudicating officer under this section.”.

19.

Insertion of new section 19-IB.—After section 19-IA of the

principal Act as so inserted, the following shall be inserted, namely:—

‘19-IB. Recovery of amounts.—(1) If a person fails to pay the

penalty imposed by the adjudicating officer or fails to comply with a

direction of disgorgement order issued under section 19 or fails to pay

any fees due to the Board, the Recovery Officer may draw up under his

signature a statement in the specified form specifying the amount due

from the person (such statement being hereafter in this Chapter referred

to as certificate) and shall proceed to recover from such person the

amount specified in the certificate by one or more of the following

modes, namely:—

(a) attachment and sale of the person’s movable property;

(b) attachment of the person’s bank accounts;

(d) arrest of the person and his detention in prison;

(e) appointing a .receiver for the management of the person’s

movable and immovable properties,

and for this purpose, the provisions of sections 221 to 227, 228A, 229,

231, 232, the Second and Third Schedules to the Income-tax Act, 1961

(43 of 1961) and the Income-tax (Certificate Proceedings) Rules, 1962, as

in force from time to time, in so far as may be, apply with necessary

modifications as if the said provisions and the rules thereunder were

the provisions of this Act and referred to the amount due under this

Act instead of to income-tax under the Income-tax Act, 1961.

Explanation 1.—For the purposes of this sub-section, the

person’s movable or immovable property or monies held in bank

accounts shall include any property or monies held in bank

accounts which has been transferred, directly or indirectly on or

after the date when the amount specified in certificate had become

due, by the person to his spouse or minor child or son’s wife or

son’s minor child, otherwise than for adequate consideration, and

which is held by, or stands in the name of, any of the persons

aforesaid; and so far as the movable or immovable property or

monies held in bank accounts so transferred to his minor child or

his son’s minor child is concerned, it shall, even after the date of

attainment of majority by such minor child or son’s minor child, as

the case may be, continue to be included in the person’s movable

or immovable property or monies held in bank accounts for

recovering any amount due from the person under this Act.

Explanation 2.—Any reference under the provisions of the

Second and Third Schedules to the Income-tax Act, 1961(43 of 1961)

and the Income-tax (Certificate Proceedings) Rules, 1962 to the

assessee shall be construed as a reference to the person specified

in the certificate.

Explanation 3.— Any reference to appeal in Chapter XVIID and

the Second Schedule to the Income-tax Act, 1961 (43 of 1961), shall

be construed as a reference to appeal before the securities Appellate

Tribunal under section 23A of this Act.

(2)

The recovery officer shall be empowered to seek the

assistance of the local district administration while exercising, the

powers under sub-section (1).

(3)

Notwithstanding anything contained in any other law for the

time being in force, the recovery of amounts by a Recovery Officer

under sub-section (1), pursuant to non-compliance with any direction

issued by the Board under section 19, shall have precedence over any

other claim against such person.

(4)

For the purposes of sub-sections (1), (2) and (3), the

expression “Recovery Officer” means any officer of the Board who may

be authorised, by general or special order in writing, to exercise the

powers of a Recovery Officer.

20.

Amendment of section 22.—In section 22 of the principal Act, sub-

section (2) shall be omitted.

21.

Insertion of new sections 22C, 22D, 22E, 22F and 22G.—After

section 22B of the principal Act, the following sections shall be

inserted, namely:-

“22C. Establishment of Special Courts.—(1) The Central Government

may, for the purpose of providing speedy trial of offences under this

Act, by notification, establish or designate as many Special Courts as

may be necessary.

(2)

A Special Court shall consist of a single judge who shall be

appointed by the Central Government with the concurrence of the Chief

Justice of the High Court within whose jurisdiction the judge to be

appointed is working.

(3)

A person shall not be qualified for appointment as a judge of a

Special Court unless he is, immediately before such appointment,

holding the office of a Sessions Judge or an Additional Sessions Judge,

as the case may be.

22D. Offences triable by Special Courts.—Notwithstanding anything

contained in the Code of Criminal Procedure, 1973 (2 of 1974) all

offences under this Act committed prior to the date of commencement of

the Securities Laws (Amendment) Ordinance, 2013 or on or after the

date of such commencement, shall be taken cognizance of and triable by

the Special Court established for the area in which the offence is

committed or where there are more Special Courts than one for such

area, by such one of them as may be specified in this behalf by the

High Court concerned.

22E. Appeal and Revision.—The High Court may exercise, so far as

may be applicable, all the powers conferred by Chapters XXIX and

XXX of the Code of Criminal Procedure, 1973 (2 of 1974) on a High

Court, as if a Special Court within the local limits of the jurisdiction of

the High Court were a Court of Session trying cases within the local

limits of the jurisdiction of the High Court.

22F. Application of Code to proceedings before Special Court.—

Save as otherwise provided in this Act, the provisions of the Code of

Criminal Procedure, 1973 shall apply to the proceedings before a Special

Court and for the purposes of the said provisions, the Special Court

shall be deemed to be a Court of Session and the person conducting

prosecution before a Special Court shall be deemed to be a Public

Prosecutor within the meaning of clause (u) of section 2 of the Code of

Criminal Procedure, 1973 (2 of 1974).

(2)

The person conducting prosecution referred to in sub-section

(1) should have been in practice as an Advocate for not less than

seven years or should have held a post, for a period of not less

than seven years, under the Union or a State, requiring special

knowledge of law.

22G. Transitional provisions.—Any offence committed under this Act,

which is triable by a Special Court shall, until a Special Court is

established, be tried by a Court of Session exercising jurisdiction over

the area, notwithstanding anything contained in the Code of Criminal

Procedure, 1973 (2 of 1974).

Provided that nothing contained in this section shall affect the

powers of the High Court under section 407 of the Code to transfer any

case or class of cases taken cognizance by a Court of Session under

this section.”.

22. Amendment of section 23 A.—In section 23A of the principal Act,

sub-section (2) shall be omitted.

PRANAB MUKHERJEE,

President.

P. K. MALHOTRA,

Secretary to the Government of India.