Powers of SEBI

To carry out its functions effectively, the SEBI Act, 1992 vests SEBI with powers that combine elements of all three arms of government within its own specialised sphere:

• Quasi-legislative powers — SEBI can draft, notify and enforce rules and regulations to protect investors and regulate intermediaries. Once notified, these regulations carry the force of law, exactly like an Act passed by a legislature would within its own domain.
• Quasi-executive powers — SEBI can inspect the books of accounts and records of stock exchanges and intermediaries, conduct investigations, and initiate action against violators, including passing cease-and-desist orders, ordering the impounding of illegal gains, and, where warranted, ordering search and seizure.
• Quasi-judicial powers — SEBI can conduct hearings and pass judgments in cases of fraud and unfair trade practices in the securities market, and impose penalties (monetary fines, suspension or cancellation of registration) on erring intermediaries and companies, much as a court would. …