Question

SEBI was established as India’s principal capital markets regulator with the aim to protect the interest of investors in securities and promote the development and regulation of the securities market in India. SEBI is empowered to regulate the securities market in India by the SEBI Act 1992, the SCRA and the Depositories Act 1996. SEBI’s powers to regulate the securities market are wide and include delegated legislative, administrative, and adjudicatory powers to enforce SEBI’s regulations. SEBI exercises its delegated legislative power by inter alia framing regulations and appropriately amending them to keep up with the dynamic nature of the securities’ market. SEBI has issued a number of regulations on various areas of security regulation which form the backbone of the framework governing the securities market in India.
Section 11 of the SEBI Act lays down the functions of SEBI and expressly states that it “shall be the duty of the Board to protect the interests of investors in securities and to promote the development of, and to regulate the securities market, by such measures as it thinks fit”. Further, Section 30 of the SEBI Act empowers SEBI to make regulations consistent with the Act. Significantly, while framing these regulations, SEBI consults its advisory committees consisting of domain experts, including market experts, leading market players, legal experts, technology experts, retired Judges of this Court or the High Courts, academicians, representatives of industry associations and investor associations. During the consultative process, SEBI also invites and duly considers comments from the public on their proposed regulations. SEBI follows similar consultative processes while reviewing and amending its regulations.
(Extracted, with edits and revision, from the judgement in Vishal Tiwari v. Union of India, [2024] 1 S.C.R. 171)