Match List-I with List-II:
| List-I | List-II |
| (Explanation) | (Function/Objective of SEBI) |
| (A) Training of intermediaries of the securities market. | (I) Development function |
| (B) Audits of stock exchanges. | (II) Regulatory function |
| (C) To regulate the securities industry to promote its orderly functioning. | (III) Protective function |
| (D) Imposing penalties for insider trading. | (IV) Objective of SEBI |
Choose the correct answer from the options given below:
Answer & explanation
Correct answer: option 3
The correct answer is Option (3) → (A) - (I), (B) - (II), (C) - (IV), (D) - (III)
(A) Training of intermediaries of the securities market. — this matches (I) Development function. SEBI’s development functions help the market grow. Training brokers and other intermediaries makes them more capable, so the market works better.
(B) Audits of stock exchanges. — this matches (II) Regulatory function. Regulatory functions make the market follow the rules. SEBI inspects, enquires into and audits stock exchanges and intermediaries to check that they obey the law.
(C) To regulate the securities industry to promote its orderly functioning. — this matches (IV) Objective of SEBI. This is not a task SEBI performs but the purpose for which it was set up. Its functions exist to achieve this objective.
(D) Imposing penalties for insider trading. — this matches (III) Protective function. Insider trading means people inside a company using secret price-sensitive information to trade in its shares. It cheats ordinary investors, so stopping it and punishing it protects them.
Note: Although the chapter ‘Financial Markets’ was dropped from the NCERT textbooks during rationalisation, it has stayed in the NTA syllabus every year since 2022, except for 2025, and it is part of the syllabus again from 2026. This question is therefore based on the pre-rationalised NCERT, an extract from which is given below.
NCERT (Pre-rationalised Edition): “Objectives of SEBI The overall objective of SEBI is to protect the interests of investors and to promote the development of, and regulate the securities market. This may be elaborated as follows: “Functions of SEBI Keeping in mind the emerging nature of the securities market in India, SEBI was entrusted with the twin task of both regulation and development of the securities market. It also has certain protective functions.” “Regulatory Functions … 5. Calling for information by undertaking inspection, conducting enquiries and audits of stock exchanges and intermediaries.” “Development Functions 1. Training of intermediaries of the securities market.” “Protective Functions … 2. Controlling insider trading and imposing penalties for such practices.” |