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Section 17A of the SCRA deals with public issue and listing of certificates by a special purpose distinct entity. If listing permission is refused and the issuer fails to repay application money within eight days of becoming liable, what rate of interest applies on the unpaid amount?
Answer & Solution
Correct answer: B.
1. Section 17A regulates the listing of SPV-issued certificates.
2. If listing is refused or not granted, the issuer must repay subscription money received.
3. If repayment is not made within eight days of the issuer becoming liable, interest accrues.
4. The statutory rate is fifteen percent per annum, jointly and severally on the issuer and every director.
5. The other rates are not the SCRA-prescribed figure.
_Source: ICSI CS Executive Paper 6 (Securities Laws and Capital Markets) — Lesson 1: Securities Contracts (Regulation) Act, 1956, pp. 4-21._
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