Stock-broker fee continuity applies only in express conversion cases; transmission requires fresh registration and prescribed fees.

The stock-broker fee regime does not recognise succession to registration on transmission of a business. Fee continuity is expressly available only for conversion of an individual or partnership membership into a corporate entity under Schedule III, and that limited benefit cannot be extended by analogy. A transferee or successor must obtain fresh registration and pay the prescribed fee structure, under which the initial five-year period is turnover-based before the flat fee applies. The regulatory scheme under the SEBI Act, 1992, the Stock-Brokers and Sub-Brokers Rules, 1992, and the Regulations, 1992 therefore requires fresh compliance on transmission.

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Issues: Whether fee continuity benefit under the stock-broker fee regime is available on transmission of a stock-broker business so as to avoid fresh registration and the turnover-based fee for the initial period.

Analysis: The statutory scheme under the Securities and Exchange Board of India Act, 1992, the Securities and Exchange Board of India (Stock-Brokers and Sub-Brokers) Rules, 1992, and the Securities and Exchange Board of India (Stock-Brokers and Sub-Brokers) Regulations, 1992 does not provide for succession to registration on transmission. The fee continuity benefit is specifically provided only in the limited case of conversion of an individual or partnership membership into a corporate entity under Schedule III, and that benefit cannot be extended by analogy to other situations. A person seeking to operate as a stock-broker must obtain fresh registration, and for the initial five years the fee is linked to turnover, after which the flat fee applies.

Conclusion: Fee continuity benefit is not available on transmission, and fresh registration with payment of the applicable fee was required; the appeal failed.

Ratio Decidendi: Statutory fee continuity for stock-brokers cannot be claimed outside the express regulatory provision, and in the absence of a rule recognising succession to registration, a transferee or successor must obtain fresh registration under the prescribed fee structure.

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