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    Question

    If any loss is caused to the beneficial owner due to

    the negligence of the depository or the participant. 
    A the Board shall indemnify such beneficial owner Correct Answer Incorrect Answer
    B the participant shall indemnify such beneficial owner Correct Answer Incorrect Answer
    C the depository shall indemnify such beneficial owner Correct Answer Incorrect Answer
    D the Government shall indemnify such beneficial owner Correct Answer Incorrect Answer
    E Both the depository and the participant shall indemnify the beneficial owner Correct Answer Incorrect Answer

    Solution

    Section 16 of Depository Act - Depositories to indemnify loss in certain cases. Without prejudice to the provisions of any other law for the time being in force, any loss  caused  to  the  beneficial  owner  due  to  the  negligence  of  the  depository  or  the participant, the depository shall indemnify such beneficial owner. (2)  Where  the  loss  due  to  the  negligence  of  the  participant  under  sub-section  (1)  is indemnified by the depository, the depository shall have the right to recover the same from such participant.

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