November 22, 2001
‘7’LOK SABHA
NO DIFFERENCES OVER INVESTOR EDUCTION AND PROTECTION FUND
A Committee headed by Dr. N.L. Mitra, former Director, National Law School, Bangalore has recommended a new Investor Protection Act. The existing Companies Act, 1956, aims at regulating financial and management aspects of bodies corporate, adequately equally providing for both managerial autonomy and investor protection. In fact, protection of share-holders, debenture-holders, depositors etc. is one of the major theme of the Companies Act, 1956.
The Committee on Investor Education and Protection Fund, constituted under Section 205C(4) of the Companies Act, 1956, which has representatives of Reserve Bank of India and Securities and Exchange Board of India (SEBI) also, has too felt that the present laws are sufficient. Besides, under Section 205C of the Companies Act, an Investor Education and Protection Fund has been set up, and rules in this regard notified. As such, it is felt that the investors have adequate protection under the existing laws, and there may be no need for yet another Act.
This information was given by the Union Minister of Law, Justice and Company Affairs, Shri Arun Jaitley in a written reply to a question from Shri K.E. Krishnamurthy in the Lok Sabha today.