Section 23-I of SCRA : Section 23-I: Power To Adjudicate

Explanation using Example

Imagine a scenario where a stockbroker has been accused of violating certain regulations under the Securities Contracts (Regulation) Act, such as insider trading or failing to maintain proper records. Under Section 23-I of the Act, the Securities and Exchange Board of India (SEBI) would appoint an adjudicating officer to conduct an inquiry into the stockbroker's actions.

The adjudicating officer, who must be at least at the rank of a Division Chief within SEBI, would provide the stockbroker with a chance to be heard, ensuring a fair inquiry process. During the inquiry, the officer has the authority to call upon witnesses or demand documents that are relevant to the investigation.

If the officer concludes that the stockbroker did indeed violate the regulations, a penalty can be imposed. Moreover, SEBI has the right to review the adjudicating officer's decision and, if found to be lenient and not in the interest of the securities market, SEBI can enhance the penalty within three months of the original order or the resolution of any appeal, whichever comes first, provided that the stockbroker is given an opportunity to be heard on the matter.