MAHARASHTRA NATIONAL LAW UNIVERSITY, NAGPUR

B.A.LL.B.(Hons.) Year-V Semester-IX: Academic Year : 2021-2022

Second Open Book Assessment, November-2021
SECURITIES AND INVESTMENT LAWS
Total Marks: Forty (40)
Instructions:
1. Read the questions carefully and answer.
2. No clarification shall be sought on the question paper.
3. Use the Answer File Template sent by Examination Section and fill the necessary
information.
4. Answer File Nomenclature : UID and Course Name (For Example-UID: UG2017-01 &
Course: Securities and Investment Laws, Answer File Nomenclature: 2017-01
SecuritiesandInvestmentLaws).
5. Use of open resource(s) to answer the question(s) is permitted.
6. Answer file in MS Word shall be submitted on or before 11:59 pm, on Sunday, November
28, 2021 on a link provided by the respective subject teacher.
7. Students are advised not to consult any faculty member/outsider or any other person
regarding the questions and must strictly adhere to professional values.
8. The contents of question paper are strictly for private circulation only.

Note: Total No. of questions are FIVE (5). Attempt any FOUR (4) questions.
1. The equity shares of Ebco Tiles Ltd. were listed with the Bombay Stock Exchange. The shares
of the company were infrequently traded, therefore, the company decided to delist its equity
shares from the Bombay Stock Exchange. Accordingly, it made an application to sought
approval in principle for delisting of the equity shares from the Bombay Stock Exchange.
However, the Bombay Stock Exchange refused to grant in principle approval for delisting of
the equity shares on the ground of non-resolution of investor grievances. Pursuant to which,
the company had filed an undertaking-cum-indemnity with the Bombay Stock Exchange
claiming that, it has resolved all the investor grievances. However, the Bombay Stock
Exchange refused to grant in principle approval for delisting of the equity shares of the
company. Against the refusal, company filed a writ petition and submitted that, a stock
exchange cannot withhold grant of in principle approval for voluntary delisting of securities,
unfairly. Further, it contended that the provisions of Securities Contracts (Regulation) Act 1956
do not contain any provision for voluntary delisting. Therefore, the Bombay Stock Exchange
should have granted the in principle approval.
Examine the above facts with the help of relevant legal provisions and judicial
pronouncement(s) to assist the High Court in deciding the matter.
10 Marks

2. “Funds are preferable method of investment as it enables an investor to diversify h is/her

resources towards different kinds of investments. It can be set up with different objectives
however its primary goal is to deliver regular income or capital growth for the investors”.
In the light of above statement, discuss the structure and classification of funds that exists in
the commercial market. 10 Marks

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3. “The expansion of the network of depository participants and the increase in proportion of
dematerialised securities in the Indian securities market, results in the reduction of risk and
lowering of transaction costs that extends to the vast majority of market participants and lead
to improved investor protection”. Comment Critically. 10 Marks

4. “The intent and purpose of the clearing system is to reduce the necessity for the physical
transfer of commodities or money, or of that which represents them. The clearing house
improves the efficiency in the transaction settlement process and insulates the financial system
from shocks emanating from operations related issues as well as to undertake related activities
that helps to broaden and deepen the securities markets in India”.
In the light of above statement, describe the role of clearing corporation in Indian depository
system and explain the interoperability model of clearing corporations. 10 Marks

5. “The investment flow being stable and the effects being persistent shows that the systematic
collective investment plans such as Mutual Funds (MFs) are the most viable ventures than the
direct market outputs. Further, MFs enables the small investors to avail the advantages of
professional management services and allow them the access to different markets, which might
not have been available to them otherwise”. Analyse Critically. 10 Marks

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