Section 4(2) in The Securities Contracts (Regulation) Act, 1956
(2)The conditions which the Central Government may prescribe under clause (a) of sub-section (1) for the grant of recognition to the stock exchanges may include, among other matters, conditions relating to,—(i)the qualifications for membership of stock exchanges;(ii)the manner in which contracts shall be entered into and enforced as between members;(iii)the representation of the Central Government on each of the stock exchange by such number of persons not exceeding three as the Central Government may nominate in this behalf; and(iv)the maintenance of accounts of members and their audit by chartered accountants whenever such audit is required by the Central Government.
