Legal Aspects of Business-1A

Legal Aspects of Business

Assignment A
Q1. Discuss consumer dispute redressal forums & consumer councils with respect to its pecuniary (Financial) jurisdictions?
Q2. “A company is a legal person distinct from its members taken individually or collectively”. Comment. Also detail the important features of a company.
Q3. Explain – ‘different modes of crossing of a cheque’ and section 138 as per the provisions of the Negotiable Instrument Act, 1881.
Q4. Write short notes on any three of the following.
(a) “A stranger to the consideration can enforce the contract”. Explain the exceptions in the following. Supervening possibility Novation
(b) Anticipatory breach of Contract
(c) A private company has only 2 shareholders who are also the directors with equal rights of management and voting power. The company has made large profits, but there is a complete deadlock in the management of the company. One of the shareholders applied for the winding up of the company. Decide at what moment does a winding up by the court commence?
(d) What is a ‘Prospectus’? Is it obligatory for a company to file a prospectus or a statement in lieu of prospectus with the Registrar of Companies?
(e) What is meant by the rule of ‘Caveat Emptor’ and what are its exceptions?
Q5. Discuss the essential elements of a valid contract.
Q6. What are the characteristics of negotiable Instrument? Discuss the ‘privileges’ of holder in due course as per the provisions of the Negotiable Instruments Act, 1881? Also state the important amendment to be incorporated under sec 138 of the act.
Q7. Elaborately explain the essential features of the consumer protection act 1986. Also briefly discuss unfair trade practice and restrictive trade practice as discussed under consumer protection Act?
Q8. “The fundamental attribute of corporate personality is that company is a legal entity distinct from the members.”Elucidate the statement .Also specify the important features of a company.

Assignment B
Case Detail :

Aditya Mass Communication Private Limited
Vs
A.P. state Road Transport Corporation
A.P. State Road Transport Corporation, Hyderabad advertised tender notice on calling for tenders for display of advertisements on the buses owned by it. According to the condition of the Tender Notice, each tender form had to be accompanied by a demand draft for Rs 20 lakhs and tender forms completed in all respects had to be put in the tender box. The accompanying sum of money was the Earnest Money Deposit (E.M.D). Clause (10) of the terms provided that the tender will be opened at 3:00 p.m. on October 31, 1996, in presence of the tenderers or their authorized agents. Clause (14) provided that tenderers will not be permitted to withdraw their tender after the tenders were opened .Clause (15) provided that if the highest tenderer backs out from taking up the agency , for whatsoever reason, the E.M.D. paid by him will be forfeited.
Aditya mass Communication Private Limited submitted its duly filled tender along with demand draft of Rs. 20 lakhs. In relation to this tender, another person approached the High Court and got an order restraining the Transport Corporation from proceeding further with the tender. Following the order, the A.P. State Road Transport Corporation opened the tender box at 3 p.m. and found six sealed covers. In view of the directions of the High Court, the covers were again placed back in the tender box without opening the seals. The signature of the tenderers and their agents was taken to this effect .The tenders were not opened to find out the highest bidder. Aditya Mass Communication Private Limited wrote a letter on November 11, 1996 stating that no reasons were given to him for non-opening of the tenders and that he could not keep the huge amount of Rs 20 lakhs locked in with all the uncertainty associated with the tender. It, thus, requested for return of the Earnest Money Deposit. A.P. State Road Transport Corporation replied on November 14, 1996 that the Aditya Mass communication had signed on the note recording the proceedings of opening the tender box and putting back sealed covers. Thus, it could not put up the argument that no reasons for non-opening of the tender was given on it. The letter notified that the tenders would be opened on November 16, 1996 at 11:30 hrs. Aditya Mass Communication once again wrote a letter on November 15, 1996 that the question of their participation in the opening of tenders did not arise as they asked for the return of E.M.D. The A.P. State Road Transport Corporation went ahead with the opening of the tender, found Aditya Mass Communication to be the highest bidder and awarded the tender to it. Aditya Mass Communication was informed of this but it demanded refund of Earnest Money Deposit. The A.P. State Road Transport Corporation following the terms of tender forfeited the earnest money deposit of Aditya Mass Communication.
Qst 1. Elaborately state the important legal issue/s covered under this case.
Qst 2. What are the essential features of a tender?
Qst 3. Give your reasons in support of your decision for the issue discussed in this case

Assignment C
Q1. Annual – general Meeting is required to be held—
By a private company only
By a public company only
By a company limited by guarantee only
By all kinds of companies

Q2. An acceptance is complete and effective only when it has been—
Communicated to the offerer
Merely mentally accepted
Externally manifested
Kept in the drawer

Q3. Name of a company can be changed by passing a special resolution and with the approval of–
The company law tribunal
The Central Government
The Registrar of Companies
none of the above

Q4. Which of the following is a mode of discharge of contract—
By impossibility of performance
By lapsse of time
By breach of contract
All of the above

Q5. Limited liability means liability of its—
Debtors is limited
Creditors is limited
Members is limited
Debenture holders is limited

Q6. In a contract of sale, property means—
Raw Materials
Movable goods
Ownership
Immovable property

Q7. The goods which are yet to be acquired by the seller, are called—
Existing Goods
Contingent Goods
Unascertained goods
Future goods

Q8. A contract becomes voidable if it has been caused by—
Coercion
Fraud
Undue Influence
All of them

Q9. If the goods have perished, the contract of sale of such specific goods, will become—
voidable
void
illegal
None of these

Q10. Articles can be altered by—
Ordinary resolution
Special Resolution
Resolution requiring special notice
Unanimous resolution

Q11. A contract entered into between the parties by words is called—
An express contract
An implied contract
A quasi Contract
An excited contract

Q12. Acceptance of an offer is complete as against the offeror as soon as—
The offerer knows about it
The letter of acceptance is posted
The letter f acceptance is signed by offeree
The letter is handed over to a delivery person

Q13. If a company fails to pay its debts suit can be filed against the—
Directors
Members
Officers
Company

Q14. A contract with a minor is—
Illegal
Valid
Void
Voidable

Q15. Who is liable for the supply of necessaries to a minor—
His guardian
His Manager
His property
He himself

Q16. A prospectus is issued—
By a Private LImited Company
By a Public Limited Company
By a Company limited by Guarantee
None of these

Q17. When, before the contract becomes due for performance, the promisor declares his intention of not performing his promise, it is called—
Remission
Waiver
Alteration
Anticipatory breach

Q18. A bailment cannot be made about—
Car
Furniture
Money
Television

Q19. The damages which arise in the usual course of things happening from the breach of contract, are called—
Remote Damages
Ordinary damages
Special damages
Special damages

Q20. When a person is employed to represent another in dealings with third person, it is a contract of—
Bailment
Guarantee
Agency
Pledge

Q21. Which of the following is not an essential element of a contract of sale—
Goods as subject matter
Transfer of property in goods
Price
Railway receipts

Q22. In return for a new television, Raju agrees to give his old television valued at Rs. 3,000 and an amount of cash worth Rs. 5,000 to Ganesh. This is a—
Barter
Exchange
Contract of sale of goods
Sale of approval

Q23. Which of the following rights is held by an unpaid seller—
Right of lien
Right of stoppage in transit
Right of resale
All of these

Q24. After exercising the right of lien, the seller can resell the goods of perishable nature—
After giving 7 days notice of resale to buyer
After giving one week’s Notice
Without giving any notice
None of these

Q25. Which of the following is not a remedy for breach of contract—
Rescission of the contract
Restitution of benefit
Suit for damages
Alteration of the contract

Q26. A contract by which one party promises to save the other from loss is called—
Contract of guarantee
Contract of indemnity
Quasi contract
None of these

Q27. Surety’s liability is—
Primary
Secondary
Absolute
None of these

Q28. Crossed cheques payable to bearer are negotiated by—
Endorsement & delivery
Delivery
Assignment
None of these

Q29. In a contract of sale, which of the following is treated as implied condition—
That the seller has title to goods
That goods are similar to description
That goods are according to sample shown
All of these

Q30. Consideration must move at the desire of—
The Promisor
The promisee
A third party
None of them

Q31. Which of the following does not relate to ‘termination of agency by operation of law’—
Death of principal
Insolvency of principal
Destruction of subject-matter
Revocation of authority by the principal

Q32. Which of the following sentence is a valid promissory note—
I promise to pay Mohan or order Rs. 1,000.
I promise to pay Hari Rs. 2,000 worth of shares..
I promise to pay Naraynan in East India Bonds
I promise to pay Rakesh Rs. 5,000 and to deliver 50 kg of sugar.

Q33. A stipulation collateral to the main purpose of the contract, is called a—
Condition
Warranty
Guarantee
None of these

Q34. A person who receives a negotiable instrument for consideration, before maturity, and in good faith, is called—
Holder for value
Holder
Holder in due course
None of these

Q35. A director must vacate his office if he fails to obtain qualification shares within—
one week
two weeks
One month
two months

Q36. Which of the following rights are available to a finder of goods—
Right of lien
Right to file a suit for reward
Right of sale of goods
All of these

Q37. A private company has at least—
7 members
3 members
3 directors
2 Members

Q38. A cheque payable to order may be negotiated—
by delivery
By endorsement
By endorsement & delivery
None of these

Q39. Which of the following endorsements is invalid—
Restrictive endorsement
Conditional endorsement
Special endorsement
Partial endorsement

Q40. When a cheque bears across its face an addition of the words “&” between two parallel transverse lines, it is called—
Special crossing
Restrictive crossing
General crossing
Double crossing