https://www.taxtmi.com/caselaws?id=433864 A contractual put option in a share purchase agreement was held not to be illegal as a forward contract or derivative transaction under the Securities Contracts (Regulation) Act, 1956 and the SEBI circular framework. The court reasoned that no present obligation to buy or sell arose on execution; a binding repurchase obligation would arise only if the contingency occurred and the investor exercised the option. Because the arrangement did not involve prohibited time-lag trading or derivative trading, and section 18A protects lawful derivative contracts without invalidating a mere embedded option, the option clauses were enforceable and the arbitral view to the contrary was reversed. en-us Thu, 02 Feb 2023 00:00:00 +0530 Sat, 11 Feb 2023 10:29:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=433864 A contractual put option in a share purchase agreement was held not to be illegal as a forward contract or derivative transaction under the Securities Contracts (Regulation) Act, 1956 and the SEBI circular framework. The court reasoned that no present obligation to buy or sell arose on execution; a binding repurchase obligation would arise only if the contingency occurred and the investor exercised the option. Because the arrangement did not involve prohibited time-lag trading or derivative trading, and section 18A protects lawful derivative contracts without invalidating a mere embedded option, the option clauses were enforceable and the arbitral view to the contrary was reversed. Case-Laws SEBI Thu, 02 Feb 2023 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=433864