Skip to content

CS Executive · Capital Market and Securities Laws · Securities Contracts (Regulation) Act, 1956

The Securities Contracts (Regulation) Act, 1956 uses the term 'depository' but does not define it. Whose definition governs it under the Act's interpretation provision?

Under the interpretation provision, words not defined in the Securities Contracts (Regulation) Act but defined in the Companies Act, SEBI Act or Depositories Act, 1996 carry those meanings. Hence depository-related terms take their meaning from the Depositories Act, 1996.

  1. AThe term has no meaning and the Act cannot be applied
  2. BThe meaning given in the Depositories Act, 1996, as words not defined in the Act but defined there carry the same meaningsCorrect
  3. COnly the meaning in the Indian Contract Act
  4. DA meaning to be fixed separately by each stock exchange

Explanation

Section 2A says words not defined in the SCRA but defined in the Companies Act, the SEBI Act or the Depositories Act, 1996 have the same meanings as in those Acts. So a depository term takes its Depositories Act meaning. Stock exchanges have no power to define it.

Did you get it right without looking?

One question tells you little. A timed set on Securities Contracts (Regulation) Act, 1956 shows your real accuracy, how long you take and where you lose marks.

Practise Securities Contracts (Regulation) Act, 1956Free diagnostic mock

More Securities Contracts (Regulation) Act, 1956 questions