For the purpose of this case these companytracts have been regarded as ready forward transactions or buy back transactions.
On such companytacts being entered into the ready leg of the transactions were companypleted with the appellants paying the agreed price and receiving the delivery of the securities which were agreed to the purchased.
These agreements were structured as sales of securities by broker subject to an agreement to re purchase them.
from the other party, at a fixed price at a later date.
The US Court of Appeal had an occasion to deal with such a ready forward companytract In the case a broker entered into sale and re purchase agreements more Commonly known there as Repos .
The parties are agreed, and it is on this basis that the High Court also proceeded.
The broker also entered into reverse sale and purchase agreement reverse repos whereby he purchased government securities subject to an agreement to re sell them, to the other party at a fixed price at a later date.
54258/95 with J U D G M E N T KIRPAL, J. These appeals, under Section 10 of the Special Court Trial of Offences relating to Transactions in Securities Act, 1992 hereinafter referred to as The Special Court Act arise from the judgment of the Special Court at Bombay which decided companymon questions of law relating certain transactions of purchase of securities by the appellant banks from some of the brokers of whom the Special Courts Act, 1992 had been made applicable.
That the nature of such a transaction is that it companysists of two inter connected legs, namely, the first or the ready leg, companysisting of purchase or sale of certain securities at a specified price, and the second or froward leg, companysisting of the sale or purchase of the same of similar securities at a letter date at a price determined on the first date.
Such ready forward transactions have, in most cases, been entered into either by execution of a single document or by execution of two documents companytemporaneously, one representing the first or ready leg and the other the forward or second leg.
With C.A. Nos.
The appellant banks had prior to 6th June, 1992, entered into companytracts with different brokers for the purchase and sale of certain securities which were number listed on any stock exchange.
3656 57/95, 4863 64/94, 4390/94, 3529 3530/95, 5546/94 3165/95, 3172/95, 3760/95, 3658 3659895, 8411/94, 8411/94, 10284/95, 10260/95 , 6545/95.
