(1) It shall be the duty of the depository, a participant, a beneficial owner, an issuer or its agent whose affairs are being inspected or investigated, and of every director, officer and employee thereof, to produce to the inspecting officer such books, securities, accounts, records and other documents in its custody or control and furnish him with such statements and information relating to his activities as a depository, a participant, a beneficial owner, an issuer or its agent, as the inspecting officer may require, within such reasonable period as the inspecting officer may specify.
(2) The depository, a participant, a beneficial owner, an issuer or its agent also allow the inspecting officer to have reasonable access to the premises occupied by him or by any other person on his behalf and also extend reasonable facility for examining any books, records, 33 documents and computer data in the possession of the depository, a participant, a beneficial owner, an issuer or its agent or such other person and also provide copies of documents or other materials which, in the opinion of the inspecting officer are relevant for the purposes of the inspection.
(3) The inspecting officer, in the course of inspection or investigation, shall be entitled to examine or to record the statements of any director, officer or employee of the depository, a participant, a beneficial owner, an issuer or its agent.
(4) It shall be the duty of every director, officer or employee of the depository, a participant, a beneficial owner, an issuer or its agent to give to the inspecting officer all assistance in connection with the inspection, which the inspecting officer may reasonably require.
Submission of report to the Board
87. The inspecting officer shall, as soon as possible, on completion of the inspection or investigation as the case may be, submit a report to the Board:
Provided that if directed to do so by the Board, he may submit interim reports.
Action on inspection or investigation report
88. The Board or the Chairman shall after consideration of inspection or investigation report take such action as the Board or Chairman may deem fit and appropriate including action under Chapter V of the Securities and Exchange Board of India (Intermediaries) Regulations,
2008.
Appointment of Auditor
89. The Board shall have the power to appoint an auditor to inspect or investigate, into the books of account, records, documents, infrastructures, systems and procedures or affairs of a depository, a participant, a beneficial owner, an issuer or its agent :
Provided that the auditor so appointed shall have the same powers of the inspecting or investigating officer as stated in regulations 84 and 85, and the obligation of the depository, participant, beneficial owner, issuer or its agent and their respective directors, officers and employees, as the case may be, as stated in regulation 86, shall be applicable to the inspection or investigation under this regulation.
Board to recover the expenses
90. The Board shall be entitled to recover from the depository, participant, beneficial owner, issuer or its agent, as the case may be, such expenses including fees paid to the auditors as may be incurred by it for the purposes of inspecting or investigating the books of account, records, documents, infrastructures, system and procedures of the depository, participant, beneficial owner, issuer or its agent, as the case may be.
34 Application of Chapter
91. Nothing contained in this Chapter shall be applicable to the State or the Central Government where it is the issuer of the Government securities.
CHAPTER X PROCEDURE FOR ACTION IN CASE OF DEFAULT Liability for action in case of default
92. Without prejudice to the power of the Board to take action, under the provisions of the Act and the Depositories Act, if a depository or a participant:-
(a) contravenes any of the provisions of the Act, the Depositories Act, the bye-laws, agreements and these regulations;
(b) fails to furnish any information relating to its activity as a depository or participant as required under these regulations;
(c) does not furnish the information called for by the Board under clause (a) of sub-section (1) of section 18 of the Depositories Act or furnishes information which is false or misleading in any material particular;
(d) does not co-operate in any inspection or investigation or enquiry conducted by the Board;
(e) fails to comply with any direction of the Board issued under section 18 of the Depositories Act;
(f) fails to pay the annual fee referred to in regulation 8, shall be dealt with in the manner provided under Chapter V of the Securities and Exchange Board of India (Intermediaries) Regulations, 2008.
Liability for action in case of default by issuer or its agent