Section 18: Power of the Commission to approve a scheme of integration

18. Power of the Commission to approve a scheme of integration.—(1) On receipt of a scheme of integration under section 17, the Commission may approve the scheme in principle. Upon such approval, the stock exchanges shall publish the scheme of integration in two daily newspapers of national coverage, requiring the stakeholders to intimate directly to the Commission in writing, within the 15th day from the date of such publication, the reasons, if any, why the Commission should not approve the scheme of integration. Upon receipt of any written objections to the scheme of integration, the Commission shall provide a reasonable opportunity of being heard to such objectors. (2) The Commission may make such inquiry and obtain such further information, as it may deem necessary, in order to determine as to whether to finally approve the scheme of integration or not. (3) The Commission may, if satisfied that the requirements of the prescribed procedure have been complied with, approve the scheme of integration with such modifications, if any, as it may deem appropriate, and specify the effective date of integration. (4) Where a scheme of integration is approved under sub-section (3), it shall be posted on the website of the Commission and published in the official Gazette. In addition, the stock exchange shall publish the approved scheme in two daily newspapers of national circulation. (5) With effect from the date of the order of approval of the scheme of integration, notwithstanding anything to the contrary contained in any other law for the time being in force or any agreement, award, judgment or decree, the scheme of integration shall have effect and shall be binding on all persons interested in the transferor stock exchange or the successor stock exchange (or the new legal entity as the case may be) including all shareholders, stakeholders and employees of the stock exchanges and all persons having an interest in any asset, undertaking or liability of either the transferor stock exchange or the successor stock exchange (or the new legal entity as the case may be). (6) Notwithstanding anything to the contrary contained in any other law for the time being in force, with effect from the date of the order approving the scheme of integration, all the assets, undertakings and liabilities of the transferor stock exchange shall, in accordance with the scheme of integration, stand transferred to, and vest in, the successor stock exchange, and the transferor stock exchange shall, with effect from the date of such order, cease to exist. (7) The stakeholders of the transferor stock exchange shall, with effect from the date of the order approving the scheme of integration, become the stakeholders of the successor stock exchange or the new legal entity as the case may be. (8) The Commission may make such further or consequential orders or give such directions, as it deems necessary, in order to effect the integration of the stock exchanges in accordance with the approved scheme of integration. (9) Where the Commission is satisfied that it would not be in the interest of either the capital and stock markets or the general public to approve the scheme, it may by an order in writing, reject the scheme: Provided that the Commission shall, prior to issuance of such order, give a reasonable opportunity of being heard to the stock exchanges seeking integration. CHAPTER-V OFFENCES AND PENALTIES

Effective date: 2012-01-01

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