Section 13: Contracts in notified areas illegal in certain circumstances

If the Central Government is satisfied, having regard to the nature or the volume of transactions in securities in any [State or States or area], that is necessary so to do, it may, by notification in the Official Gazette, declare this section to apply to such [State or States or area], and thereupon every contract in such [State or States or area] which is entered into after the date of the notification otherwise than [between members of a recognised stock exchange or recognised stock exchanges] in such [State or States or area] or through or with such member shall be illegal.

[Provided that any contract entered into between members of two or more recognised stock exchanges in such State or States or area, shall—

(i) be subject to such terms and conditions as may be stipulated by the respective stock exchanges with prior approval of Securities and Exchange Board of India;

(ii) require prior permission from the respective stock exchanges if so stipulated by the stock exchanges with prior approval of the Securities and Exchange Board of India.]