Presentation on theme: "LEGAL ASPECTS OF BANKING OPERATIONS INDIAN INSTITUTE OF BANKING & FINANCE MODULE C & D 11.10.07."— Presentation transcript:
LEGAL ASPECTS OF BANKING OPERATIONS INDIAN INSTITUTE OF BANKING & FINANCE MODULE C & D 11.10.07
**SARFAESI Act 2002, extends to whole of India including the State of Jammu & Kashmir. Also applicable to housing finance companies... The act is effective from 21.06.2002. It also covers the earlier loans which are outstanding.
.. Based on the observation of the Supreme Court in the Mardia Chemicals vs Union of India case, the Government of India issued notification amending the provisions of the SARFAESI Act. The amendment stipulates payment of 50% amount instead of 75% as originally enacted. (When appealed)
. Take over of loans or advances from the Bank or Financial Institution for the purpose of recovery is known as Asset reconstruction.. The word Board is used in the Act refers to the Securities and Exchange Board of India (SEBI)
01.. The SARFAESI Act is not applicable to a.. Regional Rural Banks b.. Nationalized Banks c.. Co-operative Banks d.. State Bank of India and their Associate banks
. Default should have been committed by the debtor.. The borrower’s account should have been classified as NPA as per the guidelines of RBI.. The Act is applicable only to a Secured creditor and not to an unsecured creditor
02..Which one is not pertaining to Hypothecation. a.. A charge in or upon any movable property b.. Right in favour of the creditor c.. Possession also with the lender d.. Retaining the ownership with the owner of the property
03..Bank G has lent to N a sum of Rs.2 lacs on the hypothecation of a car. Identify the Originator as per the provisions of the SARFAESI Act. a.. Borrower N b.. Bank G c.. Both are not Originators d.. SEBI
**Obligor is a person liable to pay to the lender (originator). As per the contract terms and conditions or otherwise. He has to discharge any obligation in respect of a financial asset whether existing, future, conditional or contingent or and includes a borrower.
04.. Identify the odd item (Qualified Institutional Buyer) a.. Bank b.. Insurance company c.. Individual Investor d.. An Asset Management Company
The securitization company or reconstruction Company to raise funds from qualified institutional buyers by formulating schemes..Separate scheme wise accounts to be Maintained..The Scheme invites subscription to security receipts proposed to be issued by such company under the scheme.
05.. Acquisition of financial asset from the originator, by Securitisation or reconstruction company is known as a.. Reconstruction b.. Securitisation c.. Transfer of Assets d.. None of these
..On acquisition of financial asset the securitisation or reconstruction company becomes the owner of financial asset and steps into the shoes of the lender bank or financial institution... RBI is the regulatory authority for securitisation or reconstruction company.
06..The minimum capital requirement for securitisation or reconstruction company, at the time of registration is a.. Rs. 30 Crore b.. Rs. 50 Crore c.. Rs.100 Crore d.. Rs.200 Crore
.. Securitisation company is a company registered under the Companies Act,1956 for the purpose of securitisation. It also needs registration from RBI under the provisions of SARFAESI Act... Security agreement includes an agreement, instrument or any other document or arrangement under which security interest is created in favor of secured creditor
07..The securitisation company can set up separate trusts scheme wise and act trustees for such schemes as provided in the Securitisation Companies and Reconstruction Companies (Reserve Bank) Guidelines and Directions,2003. The beneficiaries of such trusts are a.. Investors b.. Debtors c.. Creditors d.. Lending Bankers
08..The creation of mortgage by deposit of title deeds with the secured creditor is considered as a.. Security Receipt b.. Security Agreement c.. Secured Asset d.. Secured Debt
..Secured debt means a debt which is secured by any security interest...Secured Asset means the property on which security interest is created... The powers given by SARFAESI Act for enforcement of securities are against secured assets only
09..Security Receipt is issued a.. To Borrower by the Bank b.. To Qualified Institutional buyer by the Reconstruction Company c.. To Creditor by the Securitisation Company d...To Reconstruction company by the Securitisation Company
..The security receipt evidences the purchaser’s undivided right, title and interest in the security...These receipts are transferable in the market... Sponsor is a person holding not less than 10% of the paid up capital of securitisation or reconstruction company.
10.. The Securitisation or reconstruction company to commence business or carry on business subject to 1.It obtains certificate of registration from the Registrar of Companies 2.It has the owned funds not less than Rs3 crore or such other amount not to exceed 10% of the financial assets acquired to be acquired a.Correct b.. Incorrect c.From SEBI and not Registrar of Companies; Not less than Rs 2 crore and not to cross 12% d.None of these
..Depending on the nature of security asset RBI has the powers to specify different amounts of owned funds for different companies...The company can formulate separate schemes for acquisition of financial asset...The securitisation or reconstruction company can act as trustees for such trusts and manage the assets held in trust.
..The Securitisation or reconstruction company can acquire financial asset without execution of any deed of assignment or transfer in its favor by the concerned bank or the financial institution...Assignment is complete on the acquiring company issuing debenture or bond and incorporating therein the terms and conditions of acquisition.
.. The securitisation involves two stages. In the first stage it is acquisition of financial assets and undivided interest therein. Second stage is issue of security receipts in favor of investors for the purpose of raising money from investors
11..As per the provisions of SARFAESI Act the document to be executed requires (identify which one is not correct) a.. Payment of stamp duty b.. As per the provisions of the Indian Stamp Act c.. State Stamp duty laws d.. Central Stamp duty laws
..As per RBI guidelines, a...an acquisition of funded assets should not include take over of outstanding commitments, if any, of any bank or financial institution to lend further. b…terms of acquisition of security interest in non- fund based transactions should provide for the relative commitments to continue with bank or financial institute till demand for further funding arises
12..Which one is correct (Securitisation matter) a.Security receipt is in favor of investor b.Security receipt is issued with RBI’s permission c.Security receipt can not be transferred d.Security receipt is issued to the borrower who has failed to repay
13..When the bank decides that the financial asset now be acquired by the securitisation company, a notice of such development to be given to a.. The Obligor b.. Such notice is not optional c.. The Obligor, which is compulsory d.. The Obligor which is not compulsory under the Act.
.. If the obligor is a company there is no need for modification of charge, when the notice regarding acquisition of financial asset by a securitisation company, is not given to the debtor company. However, if such notice is given to the obligor company, then notice to the Registrar of companies becomes essential.
14.. A bank had advanced to a person who had defaulted leading to a securitisation company acquiring the financial asset. In fact no notice has been issued to the obligor. Later on the debtor remits some amount towards his dues to the bank from where he had availed the financial facility. a.. The bank can utilise the funds b.. The bank has an obligation to remit to the securitisation company c.. The bank first of all should not accept such payment d.. The bank has to enquire why the debtor had not paid earlier when the liability was outstanding with them.
..The securitisation or reconstruction company raises funds for acquisition of asset by issue of security receipts. Public/individual investors are barred from investing in a securitisation or reconstruction company by the Act...Realisation of the asset is held and applied towards redemption. i.e., repayment of investments as assured while issuing the security receipt.
15..In case there is no realization and repayment by the securitisation or reconstruction company, then the qualified institutional buyers are entitled to call a meeting of all qualified institutional buyers making investments in that scheme and the resolution passed in the meeting. a.. The first institutional buyer has the right to call for such meeting b.. The qualified institutional buyers holding not less than 75% of the total value of security receipts has the right c.. Any one of the Institutional investor who takes the lead gets the priority d.. None of the above
.. When the securitisation or reconstruction company issues security receipts the holder of the security receipts is entitled to an undivided interest in the financial asset... In such an event the security receipt does not require registration which is other wise compulsory under the Registration Act,1908
16..XYZ bank has got a security receipt from a securitisation company. They wish to transfer the same. Then a.. Such security receipt need not be registered b.. Such security receipt has to be registered c.. Such security receipt cannot be transferred d.. Such security receipt has to be retained by the bank who is the original institutional investor and hence there is no question of registration / non registration.
..Asset reconstruction means acquisition of any right or interest of any bank or financial institution in any financial asset for the purpose of realisation. Powers to take measures for asset reconstruction are given without any prejudice to the provisions contained in any other law.
..If the cause of default in an unit is mismanagement or lack of expertise on the part of the existing management the securitisation or reconstruction company has the powers to take over the management or change the management. This power can be exercised even when there is no default.
..The SARFAESI Act is silent about the grounds or reasons on the basis of which action of acquisition can be taken. Therefore, loan agreements between bank/financial institution and the borrower are required to be taken into account as provisions of this do not have overriding effect on existing contracts and laws.
17..A securitisation or recosnstruction company can raise funds by way of deposits. a.. Under special circumstances only b.. Cannot raise funds by way of deposits c.. If need arises with the permission of RBI d.. As and when required with the permission of RBI,SEBI and Company Law Board
18.. When the asset is acquired for reconstruction there is limit of six years for such reconstruction. a.. True b.. False c.. Not 6 years but 5 years d.. No such restriction on number of years
19..Which one is not correct a… At the time of enforcing securities as per the provisions of SARFAESI Act, the securitisation company may itself acquire secured assets for use or resale if such resale is through a public auction. b.. The Securitisation company is permitted to set up trusts who can issue security receipts. c.. While issuing security receipts detailed disclosures are required to be made by the securitisation company d.. While issuing security receipts detailed disclosures are not required to be made by the reconstruction company.
20..While a securitisation company is taking over the financial asset from the creditor bank, they will issue a.. Debenture b.. Security Receipt c.. Undertaking d.. None of these
..Under the SARFAESI act a secured creditor can enforce the security interest created in his favor without the INTERVENTION of the Court or Tribunal...The act deals with how the notice to be given by the secured creditor asking for repayment of the out standings.
..The secured creditor bank to give a notice asking the debtor to clear the liability in full within 60 days from the date of notice... The above is applicable to such debtors who have defaulted and classified as NPA... There is no bar for the creditor to seek the other legal remedies such as resorting to filing of suit in a competent court
21..Identify which one is not incorrect. (SARFAESI Act) a.. Notice as per the provisions of the act is a routine one b.. Notice as per the provisions of the act is a statutory notice. c.. The Act does contemplate a reply form the borrower to the notice. d.. When the offer of sale of property is accepted by the purchaser and the secured creditor accepting the offer confirms the sale, the purchaser has to deposit 50% of the offer price.
22..The authorized officer is authorized to issue sale certificate. Such certificate is conveyance of immovable property and requires stamping as per the provisions of Stamp Act. a.. True b.. False c.. Relevant State Laws d.. Central Laws
..As the powers of enforcing securities need to be exercised prudently, fairly and with due care and caution the Rules framed under SARFAESI Act provide that Authorized Officer should be of the level equivalent to Chief Manager of a public sector bank or equivalent or any other authorised person exercising powers of superintendence, direction and control of the business or affairs of the creditors, as the case may be.
..For taking possession and then sale of immovable property, the secured creditor is required to serve a possession notice on the borrower and by affixing the possession notice on the outer door or at the conspicuous place at the property...The authorised officer is required to publish the possession notice in two leading newspapers, one of which should be in vernacular language.
23..Before sale of immovable property by the secured creditor, the borrower has to be given a notice about the sale. a.. 30 days of sale b. 15 days of sale c.. 45 days of sale d. 60 days of sale
24.. If the price for secured asset is coming less than the reserve price, the authorized officer can sell the asset at a lower price a.. Then his decision will be final b.. With the consent of the secured creditor c.. With the consent of the borrower and the secured creditor d.. Without consulting any one
..When the secured creditor is required to take possession or control of the secured asset or to sell such secured asset, he can take the help of the Chief Metropolitan Magistrate or District Magistrate...For seeking their help a request in writing is required...To approach the authority within whose jurisdiction the secured asset or documents related to it are situated.
..When the secured creditor takes over the management of business of a borrower, he may publish a notice in a newspaper published in English language and in a newspaper published in Indian language in circulation in the place where the principal office of the borrower is situated, for appointment of a.. If the borrower is a company as defined in the Companies Act, 1956 to be the directors of such company, or b.. In any other case, to be the administrator of the business of borrower.
**Any person, including borrower, aggrieved by any of the measures taken by the secured creditor or his authorised officer for taking possession of the security may make an application along with the prescribed fees to the Debt Recovery Tribunal having jurisdiction within 45 days from the date on which such measures are taken.
25..The DRT has to dispose off the application preferred seeking justice, within a period of a.. 30 days b.. 45 days c.. 60 days d.. 90 days
26.. If an appeal has to be preferred based on the decision of Debt Recovery Tribunal with the Appellate Tribunal the time limit is a.. 30 days form the date of receipt of the order of Debt Recovery Tribunal b.. 15 days form the date of receipt of the order of Debt Recovery Tribunal c.. 60 days form the date of receipt of the order of Debt Recovery Tribunal d.. 45 days form the date of receipt of the order of Debt Recovery Tribunal
27..The amendment to the SARFAESI act, stipulate that no appeal can lie unless the borrower deposits 75% of the debt claimed by the secured creditor. The Tribunal has powers for reasons to be recorded to reduce this amount to 50% of the claim amount. a.. True b. From 75% to 50% and tribunal cannot reduce further c.. From 75% to 50% in the first stage and Tribunal can reduce the same to 25% d.. False
..The Central Government has to appoint by notification a person as Central Registrar for the purpose of registration contemplated under the Act...The record of Central Registrar can be kept fully or partially in computer, floppies, diskettes, or any other electronic form. The Central Registrar shall have the control and management of the Central Registrar.
28..Under the SARFAESI Act now filing of details of transactions of securitisation, reconstruction and creation of security interest is required to be filed with the Central Registrar. The period of filing such details in form as may be prescribed is 21 days after the days of transaction or creation of security. a.. Correct b.. Not 21 days and no such limit c.. Not 21 days but 30 days d.. Incorrect
..Whenever any security interest is registered with the Central Registrar is modified, the modification is required to be filed before Central Registrar. It is the duty of the securitisation company or reconstruction company or the secured creditor to file the modification.
..The security interest registered with the Central Registrar is required to be satisfied on payment of full amount by the borrower. The duty to report satisfaction is on the Securitisation company or Reconstruction company or the secured creditor. The reporting to be done within 30 days of payment in full or satisfaction of the charge.
29..On receipt of the satisfaction of the charge the Central Registrar to cause a notice to be issued to the concerned calling upon to show cause as to why the payment of satisfaction should not be recorded as intimated. Such notice to be issued a.. Within 7 days b.. Within 14 days c.. Within 21 days d.. Within 30 days
30.. If a Securitization company of Reconstruction company fails to comply with any of the directions issued by RBI, then such a company is punishable by RBI with fine not exceeding Rupees Two lacs for the default. For further continuation of the offence an additional fine is up to Rs.5000/= per day of default can be imposed. a.. Not in correct b.. Incorrect c.. Rs.5 lacs and Rs.10000/- per day respectively d.. Rs.7 lacs and Rs 5000/- per day respectively
31..The provisions of SARFAESI Act not applicable in respect of a.. A pledge of movable within the meaning of the Indian Contract Act,1872(sec172) b.. Any right of an unpaid seller as per Sale of Goods Act,1930 (sec 47) c.. Any security interest created in an agricultural land d.. All the above
32.. A bank had lent Rs.9 lacs to a borrower and obtained security in the possession of the debtor by way of hypothecation. Later on by using the provisions of the SARFAESI Act, bank could recover only Rs.5 lacs. The outstanding dues works out to rs.6.35 lacs. Then the bank a.. Can proceed against the borrower under Civil Law b.. Since the bank had availed the support of SARFAESI Act has to forego the balance outstanding c.. The bank should have applied their mind before invoking Securitisation Act d.. The bank can proceed against the borrower under Civil Law subject to the provisions of Limitation Act as well.
33..A bank has used the Securitisation Act provisions and could recover only Rs. 18 lacs. Still they will have to recover Rs.11 lacs plus interest. Fortunately for the bank the limitation period on the loan documents is intact. a.. Bank has to seek legal remedy through the Civil Court. b.. Bank has to seek legal remedy through DRT c.. Bank has to forego since they have already availed the legal avenue d.. Bank may have to approach the borrower straight away and request him to settle the balance amount.
34.. A complaint alleging deficiency in banking service may be filed with the Banking Ombudsman having the jurisdiction a.. Non-issue of drafts to customers and others b.. Inordinate delay in collection of cheques c.. Both a & b d.. None of the two
..No complaint to the Banking Ombudsman shall lie unless the complainant had before making a complaint to the Banking Ombudsman made a written representation to the bank and either the bank had rejected the complaint or the complainant had not received any reply within a period of one month after the bank concerned received his representation or the complainant is not satisfied with the reply given to him by the bank.
..The complaint is made not later than one year after the cause of action has arisen...The complaint is not in respect of the subject matter, which was settled through the office of the Banking Ombudsman in any previous proceedings
.. If a complaint is not settled by agreement within a period of one month from the date of receipt of the complaint or such further period as considered by Banking Ombudsman, he can pass an award... He shall be guided by the evidence placed before him, the principles of law and practice, directions, instructions and guidelines issued by RBI from time to time to pass the necessary award.
35..The Banking Ombudsman while passing an Award in respect of a complaint may direct the complainant to furnish a surety for refund of amount received under the Award along with interest if any. a.. There is no such requirement b.. It is not Surety but Indemnity c.. It is not only Indemnity but also suitable Surety d.. None of the above
..A bank not agreeing to accept the Award passed under the Banking Ombudsman scheme may file a review application before the Review Authority within one month from the date of receiving copy of the Award. Bank’s application to be approved by the bank’s Chairman or in his absence by the Managing Director or any other officer of equal rank.
36.. The Banking Ombudsman assuming the charge of an arbitrator shall follow the procedure as laid down under the scheme read wit the provisions of a.. The Arbitration Act, 1996 b.. The Banking Regulation Act,1949 c.. The Reserve Bank of India Act,1934 d.. None of these
37. For a Debt Recovery Tribunal, the Presiding Officer holds office for a term of 5 years from the date on which he enters upon his office or until he attains the age of 62 years, which ever is less. a.. Correct b.. In correct c.. Not 5 years and 62 years but 3 years and 63 years respectively d.. Not 5 years but 7 years whereas 62 years of age is correct.
..As per the observation of the High Court, the DRT has power to entertain the application for execution of the decree of foreign court... Every application to be filed before the DRT shall be accompanied by appropriate fees... The Tribunal may, on giving opportunity to both the sides of being heard, pass interim or final order for payment of amount including interest thereon.
38..A Civil suit which is pending stands transferred to the DRT. Then the fees payable a.. Will be decided by the DRT b.. Standard fees to be paid as applicable to a new case referred to the DRT c.. No fees required to be paid d.. None of the above
39.. A bank has moved the DRT for justice. Before the final order is passed another Bank who have also advanced to the same borrower has approached the DRT for inclusion in the same proceedings. a.. Permissible b.. Not permissible c.. Not permissible since both the contracts are different d.. DRT would not entertain and advise the bank to file a separate case.
40..Any person aggrieved by the order passed by the Tribunal or deemed to have been passed by the Tribunal under DRT Act, may prefer an appeal to the concerned Appellate Tribunal. a.. Within 45 days form the date on which copy of the order is received. b.. If the order was made by the Tribunal with the consent of the parties no appeal possible c.. Both a & b d.. Within 60 days from the date on which copy of the order is received.
.. The DRT issues Recovery Certificate to the applicant. Recovery Officer has to proceed to recover the amount specified in the Recovery Certificate, by adopting any one of the following a.. Attachment and sale of movable and immovable property of the defendants b. Arrest of the defendant and his detention in prison c.. Appointment of a receiver for the management of the movable and immovable properties of the defendant.
..The Bankers’ Book Evidence Act extends to whole of India except the Sate of Jammu & Kashmir,...Bankers’ books’ include ledgers, daybooks, cashbooks, account books and all other records used in the ordinary course of business of a bank.
41..Under the Bankers Book Evidence Act, the term Judge refers to a.. Judge of a special Court b.. Judge of a High Court c.. Judge of a DRT d.. Judge of Supreme Court
42.. For making the order that bank officer should either produce the books of account or appear as witness (as per the Bankers Book Evidence act) can be made by the Court or Judge with out summoning the bank. Such order shall be served on the bank at least 5 days before the same is to be obeyed. a.. True b.. False c.. Not 5 days but 3 days d.. At least 3 clear working days
..The Consumer Protection Act is not applicable in the State of Jammu and Kashmir...The Act is for better protection of the interests of the consumers and for that purpose to make provision for the establishment of consumer councils and other authorities for the settlement of consumers’ dispute...The Act is social welfare benefit oriented legislation for the consumer providing self- contained quasi-judicial machinery to provide speedy and simple redressal to consumer disputes.
43..A dispute where the person against whom complaint has been made, denies or disputes the allegations contained in the complaint. a.. Complaint b.. Consumer Dispute c.. Dispute d.. Allegation
44..District Consumer Protection Council to meet as an when necessary. There has to be at least two meetings every year. a.. Correct b.. Incorrect c.. At least One meeting d.. At least Three meetings
45..Which one is not correct (Consumer Protection matters). a.Once the complaint is admitted by the District Forum it cannot be transferred to any other Court or Tribunal or any authority set up under any law. b.Any person aggrieved by the order passed by the District Forum may prefer an appeal to the State Commission within a period of 30 days from the date of the order. c.A person who is a Judge of the Supreme Court, to be nominated by the Law Ministry, who shall be the Chairman of Selection Committee to the National Commission d.For filing any complaint before a District Forums, State Commission or the National Commission the limitation period is 2 years from the date of cause of action.
46.. Borrower K has executed a Demand Promissory Note and a Hypothecation agreement to Bank B. Then the bank has made available the finance. a.. Valid contract b.. In valid contract c.. Quasi contract d.. No contract
47.. A & B has taken a loan from the bank by executing a demand promissory note and other documents jointly. a.. A is the promisor b.. B is the promisee c.. Bank is the promiser d.. Bank is the promisee and both A& B promisors
48. Identify which is not essential of a valid contract. a.. Proposal and acceptance b.. Consideration c.. Free consent d.. Agreement under force
..A contract of indemnity is entered into when a party apprehends a loss in a particular contract and it wants itself to be covered from the losses it may incur... A contract guarantee is a contract to perform the promise, or discharge the liability, of a 3 rd person in case of default.
49..Bank has lent money to R on the personal guarantee of L. The bank obtained a demand promissory note from R and a guarantee agreement from both L & R. Among other contents, the guarantee agreement protected the bank with special clauses for which Guarantor L has given his consent. When R failed to repay, Bank asked L to repay the loan. He promptly refused and advised the bank to approach R who only has taken the money. After trying only they can approach him and not before that, that is what L told the bank. a.. The stand of L is incorrect b.. The stand of Bank is incorrect c.. What L says has relevant substance d.. Bank will succeed if they proceed against L even without proceeding against R based on the guarantee agreement
..Where there are co-sureties, a release by the creditor of one of them does not discharge the others. Also, the surety released does not become free from his responsibility to the other sureties...A surety has the right of Subrogation...Any guarantee obtained by means of misrepresentation made by the creditor is invalid...Any guarantee which the creditor has obtained by means of keeping silence as to material circumstance is also invalid.
50..N has given his personal guarantee for a loan to P by bank W. When the repayments are regular, N has decided to discontinue his guarantee for certain personal reasons. a.. He has the right to discontinue b.. Bank will uphold his decision to discontinue c.. Bank need not concur with the decision of the surety d.. Borrower will have to permit the surety to leave
51.. A bank has taken gold ornaments as security by way of pledge and lent. When the borrower defaulted, the bank sold the gold ornaments without intimating the Pledgor in writing. The bank depended on the contents of the pledge agreement in which the Pledgor has given it in writing and authorised the bank to dispose off without referring the matter to him in writing. a.. The bank’s stand is correct b.. The bank will succeed if contested by the pledgor c.. The bank will fail if contested by the pledgor d.. As the creditor the bank has the right to dispose off
.. No consideration is necessary to create an agency... In an emergency, an agent has authority to do all acts to protect his principal form loss as would be done by a person in his own case... An agent can detain money received by him on account of goods sold, even if all the goods consigned to him for sale are not sold.
52.. A bank as a collecting banker has misplaced the cheque accepted for collection. The customer when he approached to know about the realisation of the cheque, then only the bank could realise it has misplaced the Cheque. a.. The bank is responsible b.. Till the cheque is realized or returned, the bank is not responsible. c.. If the cheque had been purchased then the bank would have been responsible and not for collection item. d.. The bank is not responsible
.. A Sale and an Agreement Sell are different... A sale is a contract in which the parties have already performed their part... The ownership of goods stands transferred under a sale.. If the seller fails to deliver, the buyer can sue the seller
.. In an agreement to sell, the parties are yet to perform their mutual promises...The ownership of the goods yet to pass on to the seller.. In case the seller fails to deliver the goods, the buyer can claim only damages... The seller can only sue for damages.
53..Under Sale the risk in goods is with the a.. Seller b.. Buyer c.. Both of them d.. None of them
..Whether a stipulation in a contract of sale is condition or warranty depends on the types of contract. Even if the parties have agreed that a stipulation is a warranty, in fact, it may be a condition if it is the basis of the contract... If the sale of goods is by description, there is an implied condition that the goods shall correspond with the description.
54..There is an implied condition that the buyer shall have and enjoy quiet possession of the goods. a.. True b.. False c.. It is not implied condition but implied warranty d.. It is not only implied condition but also implied warranty
55.. An Unpaid Seller may exercise his right of stoppage in transit by a.. Taking actual possession of the goods b.. Giving notice of his claim to the carrier c.. Both of them d…Any one of them
56.. A B C & co a partnership firm has a current account with bank J. The account is operated by any one of the partners. A cheque (open cheque) received signed by one of the partners B, representing the firm and in favour of B. Another cheque signed by C representing the firm favouring Self. a.. The bank is in order in paying both the cheques b.. The bank is not in order in paying both the cheques c.. The bank is in order in paying the cheque signed by B and not by C d.. The bank is in order in paying the cheque signed by C and not by B
..If a minor who is admitted to receive the benefits of the partnership firm chooses to become a partner after he attains majority is responsible for all the acts of the firm with effect from the date on which he has been admitted to receive the benefits.
.. A firm can be dissolved with the consent of all the partners or in accordance with a contract between the partners... A firm can also be dissolved by agreement between the partners or by the court
57..A bank has got the documents executed by a Limited Company. However they have overlooked to get the Common Seal affixed on these documents. A reference to the Articles of Association has revealed that affixing the Common Seal for the documents has not been mentioned. In other words, the Articles of Association is silent with regard to the same. a.Bank will get protection b.Bank cannot recover the dues based on the documents c.Affixing of Common Seal is compulsory in such cases. d.Affixing of Common Seal is not compulsory unless it is specifically stated in the Articles of Association
58..Which one is incorrect a.. A private company is prohibited from acceptance of any deposit from public b.. A private company should have a minimum paid up capital of Rs.2 lcs c.. A foreign company is incorporated in India but has a place of business in foreign countries d.. A public company should have minimum 5 members
59.. Identify the correct one. a.. Any terms of the Articles of Association can be altered by an ordinary resolution b.. Change of Registered Office in another State or the object clause can be altered only by a special resolution and passed by the company and with the sanction of the Company Law Board c.. The borrowings in excess of the paid up capital plus free reserves in respect of a public limited company can be done based on resolution by way of circulation among the board of directors. d.. Both Memorandum and Articles of Associations are not considered as Public documents.
..When a company exercise its powers to promote and/or realise any of its objects stated in the Memorandum of Association, it is known as Intra vires ( i.e., within the powers of ) the company... Any other act of the company which is outside the scope of the objects clause of the Memorandum of Association is called Ultra vires(i.e., beyond the powers of ) the company
.. Doctrine of Constructive notice states that every outsider is assumed to have read the Memorandum of Association and Articles of Association. …Doctrine of Indoor Management lays down that the outsiders are not required to see the compliance of internal regulations of the company.
60.. A person is deemed to become a member of a company if he allows his name to be put on the register of the members of otherwise holds himself out as a member even if there is no agreement to become a member. a.. Ordinary Member b.. Acquiescence Member c.. Special Member d.. Non member
61.. On the death of a member, if the member has not made a nomination for the shares then the surviving joint holder (if any) or his legal representatives have the right to register themselves as members. a.. Transmission of Shares b.. Transfer of Shares c.. Assignment of Shares d.. Negotiation of Shares
62.. Identify which is not a Statutory Right a.. To receive notice of meetings, attend and vote at meetings b.To receive dividends c.To receive copies of annual accounts of the company d.To transfer shares
63.. To be registered as a member in the company’s register of members (subject to a valid membership obtained by transfer, allotment, etc.,) a.. Proprietary Right b.. Statutory Right c.. General Right d.. Documentary Right
..A prospectus must be signed by every person mentioned therein as a director or proposed to be a director... Every application form for shares must be accompanied by a copy of the prospectus except application forms issued to underwriters and existing shareholders and debenture holders.
64.. A prospectus has to be registered with a.. The Registrar of Companies b.. SEBI c.. Stock Exchange d.. No one
..The provisions of FEMA extend to all over India and also apply to all branches, offices and agencies outside India owned or controlled by a person resident in India and also to any contravention committed outside India by any such person to whom this Act applies.
65..A transaction by which there may be a change (either an increase or decrease) in the assets or liabilities outside India of persons resident in India or assets or liabilities in India of persons resident outside India. a.. Capital account Transaction b.. Current account Transaction c.. Both a & b d.. Neither a nor b
66.. The mortgagor agrees that in the event of his failing to pay according to his contract, the mortgagee shall have a right to get the mortgaged property sold and recover his dues. a.Mortgage by Conditional Sale b.Equitable Mortgage c.English Mortgage d.None of these
67..A came with his brother, to take a loan on the security of his Term deposit which will mature after 7 years. He has changed his decision and wants the same to be transferred in the name of his brother. a.. Possible b.. Impossible c.. Possible by way of assignment d.. Not possible since the FDR is not transferable
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