To prevent recurrence of scams in Indian Capital Market, the Government of India has assigned regulatory powers to

To prevent recurrence of scams in the Indian capital market, the Government vested statutory regulatory powers in the Securities and Exchange Board of India (SEBI). SEBI was established in 1988 and granted statutory authority by the SEBI Act, 1992, with a clear mandate to regulate the securities market and protect investor interests—measures specifically aimed at preventing malpractices and market scams [1]. Further, SEBI was constituted as an independent statutory authority to regulate stock exchanges and supervise major market participants, giving it powers to frame rules, enforce compliance, and take remedial actions to safeguard market integrity after the financial sector reforms of the early 1990s [2]. These provisions make SEBI the principal regulator for preventing recurring capital market frauds.

Sources

1. [1] Indian Economy, Nitin Singhania .(ed 2nd 2021-22) > Chapter 9: Agriculture > SEBI > p. 274
2. [2] Indian Economy, Vivek Singh (7th ed. 2023-24) > Chapter 6: Indian Economy [1947 – 2014] > 8. Financial Sector Reforms: > p. 217