IGTC Business Law FAQ 1. What is offer or proposal?

Offer is made by one party to other party, offer when accepted is promise.

2. What is agreement? Agreement is promise, whose object is lawful and backed by consideration.

3. What is contract? Contract is an agreement which can be enforced by law

4.

What is consideration?

Consideration is quid pro quo .Consideration can be inadequate but not illusory.

5. What is consensus ad idem? Consensus ad idem means meeting of minds.

6. What is a void agreement? Agreement which will not be enforced by court of law is known as void agreement.

7. Name two void agreements? Agreement without consensus ad idem, agreement with unclear term.

8. What is illegal agreement? When the object of the agreement is unlawful it is called as illegal agreement. Any collateral agreement to void agreement is enforceable, but a collateral agreement to illegal agreement is illegal.

9. What are social agreements? Agreements which do not have intention to be enforced by court of law is called as social agreement.

10. What is executed/ executory contract? Executed contract in which both the parties have fulfilled their promise, while executory contracts are contracts in which one or both the parties not executed their promise.

11. What is a voidable contract? A contract which can be avoided by only one of the parties is called as voidable contract.

12. What is coercion? Coercion is an act which is an offence as per Indian Penal Code

13. What is fraud? Fraud is intentional

14. What is misrepresentation? The party making the statement believes it to be true without realizing it is false.

15. What is undue influence? Undue influence is one of the party is in a position to exercise control over other party.

16. Which contracts are presumed to be made under undue influence? Contract with pardanshin women, contract with medical practitioner and patients who are seriously ill, father and minor son.

17. Who are all the parties who do not have capacity to contract? Minor, lunatic and idiots do not have any capacity to contract.

18. What is force majeure? Force Majeure is act of god like flood, earth quake, fire , the contract can specify other man made events like strike etc.

19. What is supervening impossibility? A contract which was executable at the time of entering into the same gets frustrated due to subsequent events which makes the execution of contract impossible.

20. What is contingent contract? A contract which depends on happening or non happening of an uncertain event is called as contingent contract.

21. State the heads of public policy? Trading with alien enemy, Champetry, marriage brokerage, trafficking in public office, restraint of legal proceedings 22. What is trading with alien enemy?

Transaction with a citizen of a country with whom India has declared war. 23. What is Champetry? Financing litigation with intention to make gain

24. What is marriage brokerage? Arranging marriage for financial consideration.

25. What is trafficking in public office? Agreeing to get appointment for public office for monetary considerations.

26. What is agreement in restriction of legal proceedings? Clauses which place contract beyond judicial review, but contract restricting jurisdiction to one among two courts having jurisdiction and arbitration under arbitration and conciliation act are valid.

27. What are quasi contracts? Quasi contracts are contracts are contracts which are not entered by party, but law under equitable principles of unjust enrichment deems the existence of contract.

28. What is bailment? Bailment is a contract in which possession is transferred without transferring ownership. 29. What is obligation of the bailer? In the case of gratuitous bailment he is responsible to disclose patent defect.

In the case of non gratuitous bailment he is responsible to disclose both latent and patent defect.

30. What the obligations of bailee? He should take as much care of the goods as in the case of its own goods, he should not mix bailed goods with his own goods and he should not put to bailed goods to any use other than agreed use, he should return back the bailed goods to bailer at the end of bailment period.

31. What is pledge? Pledge is a charge in which possession of the goods is transferred to the lender.

32. What is hypothecation? Both pledge and hypothecation are charge on movable property. In hypothecation, the possession remains with borrower and the charge hovers like a cloud over the property and settles down only the lender choose to exercise it.

33. What is guarantee? The liability of guarantor is coterminous with that of principle debtor and secondary.

34. What is indemnity? The liability of indemnifiers is primary.

35. What is lien? Lien is the rights of possession exercised over the property of others to realize payments.

36. What are the various ways under which contract is discharged?

Performance, specific performance, injunction, novation, recission.

37. What is specific performance and injunction? They are equitable remedies given under specific relief act, one is positive and other one is negative. 38. What is novation? Novation is substitution of one contract with other.

39. What is rescission? Recission means discharge by breach.

40. What is normal damage how it is different from penalty? Damages are levied to compensate the affected party and it is a civil remedy, while penalty is a punitive act and is a criminal remedy.

41. What is special damage? If the purpose of usage is known to other party special damages which is consequential damage can be levied.

42. What is nominal damage? It is a token damage levied for breach of contract, even though the opponent has not suffered any loss.

43. What is exemplary damage? In certain cases like breach of promise to marry and dishonor of cheques exemplary damages are given for compensating loss of honour.

44. What is liquidated damage? If the cost of ascertaining damage is prohibitive, the parties can specify a reasonable some as liquidated damages.

45. What is quantum meriut? It is based on the principle of unjust enrichment, whereby a party is compensated for work done with implied consent of other party , even though no contract exist for the same.

46. What is privity of contract? Privity of contract means a stranger to the contract cannot sue for benefits.

47. What is exception to the rule to privity of contract? A cestique trust can sue for the benefit of contract.

48. What is Wagering? Wagering means betting. All wagering contracts are declared as void by contract act.

49. What is agreement in restraint of trade? Section 27 of contract act says that agreement in restraint of trade is void unless it is a reasonable restriction.

50. What is invitation to offer? Goods with price tags displayed in stores or goods displayed in auction are invitation to make offer and not offer.

51. What is general offer? General offer is made to world at large.

52. What is special offer? Special offer is made to particular person or persons.

53. What is standing offer? Offer which are valid till they are cancelled are called as standing offer.

54. What is communication? Communication is letting once decision known to other party, communication is essential for contract, communication can be oral or written, unless mode of communication is specified in the contract any valid mode of communication can be adopted.

55. What is nudum pactum? Contract without consideration are called as nudum pactum, they are generally void.

56. Which contracts without consideration are valid? Transfer of property in writing for love and affection which is registered. Agency contract Past consideration is valid consideration in India unlike in India Acknowledgement of debt barred by limitation is valid contract.

57. What is counter offer? An offer can be conditional, but acceptance which is conditional becomes counter offer.

58. What is specific performance? Specific performance is a equitable remedy, here the court enforces the original contract, when monetary compensation will not give relief. 59. What is injunction? In junction is negative of specific performance, it is prevention of any act temporarily, temporary injunction or permanently, permanent injunction.

60. Whether mere silence will constitute acceptance? Under law mere silence do not constitute acceptance.

61. What is anticipatory breach? If a person knows much before the date of execution he can either breach the contract at that time called as anticipatory breach or wait till actual date of performance to breach the contract.

62. What is social contract? Social contracts are mere agreements and court will not enforce the same, exception being contract to marry.

63. What is unilateral contract? Unilateral contract is entered between highly powerful person and less powerful person and they are one sided and in nature of take it or leave it, in interpreting such contracts courts will lean in favour of the weak party.

64. What is implied acceptance? Implied acceptance are done through action, thus driving into parking lot is an implied acceptance that parking fees will be paid.

Constitution Jurisprudence 65. What is democracy? Democracy is rule of majority, where Parliament in Supreme.

66. What is Republic? Republic is governed by written constitution, which is supreme.

67. What are the various methods by which law can be interpreted? Literal interpretation, interpretation based on intention called as contemporaneous expositor where literal interpretation will give absurd results, beneficial interpretation for welfare legislation and strict interpretation for criminal prosecutions.

68. What is Ejusdem generis? Ejusdem generis is a principle of interpretation under which the general words following special words should take their meaning from special word.

69. What is associs noscittur? Words carrying same meaning come together.

70. What is ibi jus ubi remidium? This means that for justice to be achieved there should be a remedy.

71. What is writ and name five writs?

Writs invoke the extraordinary power of Court against coercive action/ inaction of the State. Five types of writs are Habeas Corpus, certiorari, quo warranto, mandamus and prohibition.

72. What are Stare decisis? Decisions of the higher courts on the same issue are binding on decisions of lower court, leading to precedents.

73. What is ratio decidendi? Ratio decidendi is the body of judgement.

74. What are obiter dicta? Obiter dicta mean observations made by judges not as a part of judgement.

75. What is Res Judicata? Res Judicata means the same matter, between same parties which has already decided by court , will not be re heard by same court.

76. What is Res subjudice? Res Subjudice means the matter is pending for decision before a judicial authority.

77. What is Rule of law? Rule will apply to the ruler.

78. What is rule of man? Rule will not apply to ruler.

79. What is ultra vires? Since in Republic constitution is supreme, anything done contrary to constitution is ultravires.

80. What is Locus Standi? Locus standi means that a person who is affected alone can agitate it before court, exception being Public Interest Litigation. 81. What Mens Rea? Mens rea means guilty mind, in serious crime prosecution should prove mens rea.

82. What is actus reas? In minor crimes action which results in violation of law itself leads to punishment, no need to prove guilty mind. 83. What are principles of natural justice? Audi Alteram Partem, no man should be condemned before being heard. No man should be a judge in his own case All judicial orders should have reasons

84. What is Statue law? Statue law are enacted by legislation.

85. What is common law? Common law are customary law like lexica loci and judge made laws like judicial PRECEDENTS.

86. What is administrative law?

When law making powers in the form of rules and regulations are delegated to executives, they are called administrative law.

87. What is quasi judicial? Some time executive authorities like income tax officers have to hear the assessee like a judge Judge without being influenced by revenue consideration and direction from superiors, these functions are called as quasi judicial function.

88. What is tribunalisation of Justice? Under 323B of constitution tribunals can be appointed to hear cases involving specialized knowledge, since court only has expertise is civil and criminal law, In tribunal unlike in court persons having expertise on subject can sit, like Income Tax appellate Tribunal, CESTAT, National Company Law Tribunal, administrative tribunal.

89. What is estoppels? Estoppels is a equitable remedy, if a person by his promise made other person to commit himself irrevocably, he cannot change the promise. There is no estoppels against statue.

90. What is restitution? Restitution is an equitable remedy, in which the court can put the parties in the same position even in case of void contract like minors contract if the consideration can be traced.

91. What is Parimateria? If a particular item has not been defined in statue, while it is defined in similar statue , that definition can be used for interpreting this statue.

92. What is Mutatis Mutandis?

Mutatis Mutandis means but for the change proposed all other things will remain same.

93. What are fundamental rights? Constitution enshrines certain rights like freedom of life, freedom of speech, freedom for peaceful assembly, freedom to live anywhere in India, freedom to practice ones religion. These cannot be taken away by state since they are not given by state. Article 32 of constitution under which a citizen can approach Supreme Court is also fundamental right. 94. What is habeus corpus? Habeus corpus means produce the person in body before me. This writ is not only against state but also against other private individuals. 95. What is writ of certiorari? If there is error in lower authorities order court can quash the same.

96. What is writ of quo warranto? If a person without authority occupies a public office, writ of quo warranto can be filed against him questioning his authority to occupy the office.

97. What is writ of prohibition? If a lower court, authority exceeds its power a writ of prohibition can be filed whereby the authority is prohibited from exercising excessive power.

98. What is writ of mandamus? Writ of mandamus can be used when lower court or authority fails to do its duty.

Sale of goods act 99 What are goods? Goods mean moveable properties. 100 What is sale? Transfer of moveable property for valuable consideration, part of it at least in terms of money. 101. What is barter? When one moveable property is exchanged for another moveable property it is called as barter. 102 What is the difference between installment sales and hire purchase? Installment sales means that consideration is paid in installment, while the title gets transferred immediately; while in hire purchase title gets transferred after payment of last installment. 103 What is nemo dat quad non habet? It means nobody can provide better title than he has

104. State exception to the rule nemo dat quad non habet? A Mercantile agent, Unpaid seller retaining lien over the goods, joint owners can be exception to the above rule and they can transfer better title to buyer who has no notice of defect.

105. What are the rights of unpaid seller? Unpaid seller has right of lien as well as right of stoppage in transit. But to stop in transit the buyer should be bankrupt.

106. Name three document of title? Lorry receipt, railway receipt and warehouse keeper certificate, bill of lading, combined transport document.

107. Name various types of deliveries? Physical delivery, symbolic delivery and constructive delivery.

108 Name various terms of delivery? FOR destination , ex works., FOB, FAS , C&F, CIF.

109 What is caveat emptor? Let buyer beware.

110. What is condition and warranty? Breach of condition goes to the root of contract; while breach of warranty makes other party can ask for damages only

111. What are the conditions? Conditions are merchantability, sale by description should correspond to description, sale by sample should correspond to sample, and sale by both should correspond to both.

112. What are warranties? Warranty is peaceful enjoyment and non encumbrance, dangerous nature of goods, fit for use of trade.

113. What is existing goods? Goods which already exist.

114. What are future goods? Future goods are yet to come into existence. 115. What are unascertained goods? Goods which are not identified and unconditionally appropriated to contract. 116. What is agreement to sale? A contract to sell future/ unascertained goods is called as agreement to sale. 117. What is the difference between sale and agreements to sale? In sale ownership/risk passes to buyer, while in agreement to sell neither ownership nor risk passes to buyer.

Negotiable instrument Act

118. What is negotiability? Negotiability means the holder can transfer better title than he himself possess.

119. Name three negotiable instruments? Promissory note, bill of exchange and cheque.

120 How a negotiable instrument can be transferred? By delivery if it is bearer instrument and by endorsement and delivery if it is an order instrument.

121. What is a promissory note? It is an unconditional promise made by the promisor to pay the named person or to his order on demand. But no promissory note can be issued for payment to bearer on demand.

122. What is bill of exchange? Bill of exchange can have three parties drawer, drawee and payee; drawee can also be payee. A bill of exchange need to be accepted. 123. Who is holder in due course? Holder in due course is a person who purchases the instrument for valuable consideration, without any notice of defect in title. Every holder is presumed to be holder in due course. 124. What is inchoate instrument? An instrument which is signed without specifying value called as inchoate instrument. 125. What is a DP bill? DP bill is bill which is payable on sight and it is also called as sight bill.

126. What is DA bill? DA bill is called as document against acceptance or usance bill. 127 What is dishonor? If the drawee of the bill refuses to pay or accept it is called as dishonor. 128. What is endorsement/ indorsement? In the case of order instrument, title can be transferred by endorsement/ indorsement and delivery. 129. What is grace period for bill of exchange? Grace period for bill of exchange is 3 days. 130. What is foreign bill? If either the drawer or drawee is a non resident or if payment is paid outside india it is called as foreign bill and foreign bills should be protested for dishonor if the law of the country where it is drawn or accepted specifies 131. What is a trade bill/ accommodation bill?

A trade bill is backed by trade transaction, while accommodation bills are not backed by trade transaction.

132. What is a cheque? A cheque is an order drawn on bank

133. What are various types of crossing? General or &co crossing which involves drawing two parallel lines on the face of the cheque , with words &co written in between, a/c payee crossing which says that the amount should be credited to payees account only, not negotiable crossing which means that the holder in due course will not get better title than transferor. Sans recourse crossing means no recourse against indorser, special crossing can be made in favour of specified bank, branch. 134. What is the remedy available for dishonor of cheque due to lack of funds in bank account? Under section 138 criminal proceedings can be initiated.

135. What is payment in due course? As per section 131/85 of the negotiable instruments act if a cheque is paid in the normal course of business the banker is protected for any mistakes committed. 136. What is meant by once a bearer cheque always a bearer cheque? Since the banker is not required to know the signature of any other person other than its customers , even if a uncrossed cheque is issued in favour of a named person, the banker need not verify the signature of person encashing the same and pay the same to barer of the cheque. 137. What are material alterations? Alteration of name, date, amount, and crossing are considered as material alteration which will make negotiable instrument void. 138. Whether acceptance of negotiable instrument be conditional? Yes acceptance of bill of exchange can be conditional. 139. What is protesting for dishonor?

Even though it is not compulsory to protest for dishonor a protest by notary public for dishonor will make court to presume that the bill is dishonoured.

Partnership

140 What is test of partnership? Mutual agency is the test of partnership

141. What is the maximum number of partners a partnership can have? 20 and 10 for banking business as per section 11 of Companies Act 88. How partnerships are created? Partnerships are created through contract known as partnership deed. 142. How HUF is created? Hindu Undivided Family is created through law. There are two schools Dayabagah practiced in Bengal and Assam and Mitaksharah practiced in rest of India. 143. Name various types of partnership? Partner ship at will, particular partnership, perpetual partnership, partnership for particular period.

144. Name various types of partners? Active partner, sleeping partner, partnership by holding out, nominal partner.

145. Whether Partnership is to be registered compulsorily? Partnership need not be registered compulsorily, but if it is not registered it cannot sue for its dues. Partners cant sue the firm other than for dissolutio9n. 146. In the absence of provisions in the partnership deed whether working partners are entitled for remuneration, partners entitled for interest on capital? No 147. What are the rights of the partner? He can participate in business, inspect books, and share in profit

148. What are the obligations of partner? Cant make secret profit, cant conduct competing business. 96. Whether a partnership is required to maintain books of accounts and Audit the same? No 149. What transaction does not fall within the implied power of partners? Partners cannot open bank account for partnership in his personal name, partners cannot buy or sell immovable properties on behalf of the firm, partner cannot admit any liability on behalf of the firm or refer any dispute to arbitration, partner cannot do partnership on behalf of the firm, and partner cannot withdraw any suit filed by the firm. All other powers can be exercised by partners unless they are specifically restricted through deed. 150. What are the various reasons for which partnership can be dissolved? If the partnership at will by notice, If it is a particular partnership after expiry of the period, Death of partner unless the deed provides otherwise, by incapacity of the partner unless deed provides otherwise, object of partnership becoming unlawful, misconduct by partner o or any other just and equitable ground the court may consider appropriate, or the business cannot be conducted but at loss.

151 What is Limited Liability Partnership?

LLP combines the features of partnership with Limited Liability Company. General partner who manages is liable for unlimited liability, while limited partner who do not participate in management is liable only to the extent of his capital and can freely transfer is interest.

152 In the absence of provision in partnership deed how much interest can be paid on loan advanced by partner? 6% 153. What is interest on capital by partner? Partnership cannot give interest on capital unless the deed provides otherwise. Even if the deed provides for interest it can be paid out of profits.

154. What is meant by fixed and fluctuating capital? If the deed so provides, partnership can have fixed capital and current account where interest , drawings and profits are accounted or fluctuating capital where profit, interest and drawings are accounted in capital account. 155. What is name of partnership? A Partnership do not have any separate existence apart from the partners, it is merely the collective name of the partners, it should be ensured that it do not resemble the name of existing company. 156. What are the properties of the firm? Any individual property or money given by partners as capital belongs to the firm and partners only have interest in it, properties purchased out of monies of the firm , properties held in the name of partners but purchased out of monies of firm as well as goodwill of the firm belongs to the firm. 157. Whether Minor can become a partner? Minor do not have capacity to contract and he cannot become a partner, if the deed so provides he can be admitted to benefits of partnership. He has the right to inspect book and sue for his profit. Within six months of becoming major he can either elect to become partner or withdraw from partnership, if he remains silent he will become a partner. 158. Who can admit a partner? Unless the deed provides otherwise all partners should agree for admitting new partner.

159. Whether a partner can be expelled? A partner can be expelled when the deed so provides and it is decided by majority of partners for bonafide purpose. 160. What is reconstitution of partnership? In reconstitution of partnership the rights of partners are varied but the firm continue to exist. 161. What are the liabilities of new partners admitted? Liabilities of new partner are from the date he is admitted as partner and not for any liabilities before that unless the partner agrees to take earlier liabilities. 162. What are the rights of retiring partner? Retiring partner is not liable for any right contracted after the date of his retirement unless he agrees otherwise, he can carry on competing business after rate of retirement, He is entitled to receive his capital and share of profits up to date of retirement, if the firm continues to do business with the money of the retiring partner it should pay the retiring partner the share of profit by using such property with 6% interest unless the deed provides for some other interest.

163. What is public notice? A Partner who retires should give public notice by way of notification in official gazette, in local newspaper, otherwise he is liable to outsiders, but no notice is required for retirement of dormant partners, estate of deceased partner or insolvency of partners.

164. What is partnership by holding out? If any person represents to other person that he is a partner in a firm, he is stopped from denying the same, this is an equitable remedy.

Insurance Act 165 What are the acts which covers Insurance in India?

Insurance Act 1938 and IRDA act 1999.

166 Name the principles of insurance? Uberremae Fiedi( utmost good faith ) as against caveat emptor in sale of goods act, Causa proxima( proximate cause), subrogation, indeminity, averages, assignment, nomination

167 What way the law is in favor of policy holders? Two years after taking life policy the cause of death cannot be contested by insurance company unless specific proof is there, Policy will acquire surrender value after 3 years payment of premium, a lapsed policy can be renewed within 2 years, if there is mis declaration of age claim cannot be denied but the differential premium along with interest can be deducted from claim amount. 168. What is solvency margin? Capital adequacy of insurer. Solvency Margin should be minimum of assets being 50% more than all liabilities.

169. What is foreign capital allowed in Insurance company? 26% 170 What is minimum capital needed to start life, general and reinsurance business? For life and general insurance 100 crores and for reinsurance 200 crores. 171. What is Uberremae Fiedi? Uberremae Fiedi is utmost goods faith, it is against general principle of caveat emptor, thus insurance is a special type of contract in which the proposer is expected to state all truth , else the insurer can forfeit the premium and need not pay any claim. 172. What is hazard, peril and loss? Hazard give rise to peril, thus a loosely hanging wire is hazard , leading to peril which will cause loss.

173. What is insured peril and excluded peril? If loss is due to insured peril it will be covered, if it is due to excluded peril it wont be covered. The onus is on the insured to prove that loss occurred due to insured peril. 174. What is subrogation? The benefits of the policy do not inure to the benefits of third party like public career; it is for the insured to preserve claims against third parties, which can be subrogated to insurer once claim is paid by him. Subrogation legally means stepping into the shoes of insured. 175. What is indemnity? Indemnity clause is against over insurance, even if a property is over insured, the insurer will pay the actual value of property as per this principle, this is to avoid moral hazard of insured destroying his own property to make excessive claims. 176. What are averages? Averages are against under insurance, if the property is underinsured to save premium, then the insured will be considered as his own insurer and claim will be paid proportionately. 177. What is contributory negligence? Insurance law do not recognize contributory negligence, thus a person can do what he is supposed to do recklessly, still the claim is payable, this leads to morale hazard of reckless behavior, to prevent this insurer introduces deductible excess. 178. What is deductible excess? In every claim a fixed portion has to be borne by the insured and balance will be paid by insurer. 179. What is deductible Franchise? Deductible franchise is to avoid excess administration work due to insignificant claims, Insurance claims also follow the Pareto principles of vital few and trivial many, to avoid excessive administration cost due to small claims it is specified in the policy claims up to certain limits will be borne by insured and claims in excess of such limit will be paid by insurer, this clause is called as deductible franchise, savings in cost is shared with insured in the form of lower premium. 180. What is insurable interest? Without insurable interest insurance will be a wagering contract, in the case of life insurance at the time of making contract insurable interest should exist, in marine insurance it should exist at the time of making claim, in other insurance it should exist at both the point. 181. What is the exception to the rule that insurance is a contract of indemnity?

Life insurance, agreed value policy for import under marine insurance and fire insurance with reinstatement clauses are exception to rule that insurance is indemnity contract.

182. What is IBNR and IBNER? IBNR is incurred but not reported, IBNER is incurred but not enough reported, they are important for determining the liability of insurer. 183. What is Reserve for URR? Due to nature of insurance business all premium accrued in a year cannot be considered as income of the company, as per insurance act 40% of premium are taken as reserve for unrealized revenue for marine, fire insurance while income tax act allows 50% of premium as reserve for unrealized revenue, thus insurance companies actually provide 50% for these business and 100% premium for marine hull and miscellaneous insurance. 184. Who are the intermediaries for insurance business? Agents, brokers, Third Party agents, Actuaries, surveyor, all intermediaries are licensed by IRDA. 185. What is the difference between agent and broker? Agent represents, one Insurance company, while broker represents clients so do not represent one company. 186. Who is a third party agent? Third party agent stands between insurer and cashless medical claim by hospitals. 187. Who is an actuary? Actuaries represents IRDA, a life insurance company should compulsorily appoint actuaries who are called as appointed actuaries, while a general insurance company should have consulting actuary, they should examine all policies and file a certificate with IRDA they are not against the policy holder before the same are issued. 188. Who is a surveyor? Surveyors are technical experts who assess the admissibility and value of claim, under insurance act any claim in excess of Rs 20,000 should be subject to survey, all surveyors are licensed by IRDA. 189. What is policy holder and share holder surplus? In life policies in with profit policy 95% of surplus is shared with policy holder as bonus, while 5% belongs to share holders.

190. What is 64VB of insurance act? Under 64VB no insurer can admit any claim unless the premium is paid in advance. 191. Who determines the investments of life and general insurance companies? IRDA determines the investments of life and general insurance companies, IRDA allows more leeway to general insurance company for making profitable investments since general insurance policies are short term and value of claim i8s indeterminable. 192. How IRDA ensures solvency of life insurance companies? By its very nature life insurance business is long term in nature, IRDA stipulates solvency certificate to be filed by actuaries and auditors as well as 3% of premium or 10 crores whichever is higher to be deposited with RBI. 193. What is assignment? Assignment of policy is made by insured for taking loan against surrender value, notice of assignment to be given to insurance company, since assignment is for valuable consideration, it cannot be cancelled without the consent of assignee. 194. What is nomination? In insurance policy nomination can be made where by in the event of claim amount can be paid to nominee if multiple claims are made. 195. What is reinsurance? Reinsurance is done for general insurance company to share risk in the case of huge claims

Company Law 196 What is meant by Ltd and Private Ltd? Limited means share holders liability is limited to the amount of shares he agreed to take. PVT Ltd means the company even though is incorporated and enjoys limited liability is more akin to Partnership. 197 What is Charter of a Company and what is Ultravires? The Charter of a Company is known as memorandum of association. Any thing done beyond the object clause in memorandum is ultravires or beyond the powers of the company and so null and void.

198 What document represents interse agreement among shareholders? Articles of association represents interse agreement among shareholders. 199. What is the hierarchy of documents? Companies Act is superior to memorandum and articles, anything contrary to act in memorandum and articles is null and void. Memorandum is superior to article anything contrary to memorandum in articles is void.

200. What is agency problem, how it is created in a Company? Agency problem arises in the Company since the shareholders, who are owners elect directors who have no stakes in the company to manage the company, the directors appoint senior management and they in turn appoint other employees, none of whom has any stake in the company, thus the owners donot manage the Company and the Directors and employees who manage the company do not have any stake in the company leading to agency problem. 201 What are the various remedies in Company Law for solving agency problem? Certain critical decisions can be taken only with the approval of share holders and not by directors At anytime shareholders can remove a director by simple majority without assigning any reason. Auditors are agents of share holders and Audit compulsory for limited companies. To prevent self perpetuation 2/3 of Directors have to retire compulsorily .

202. What is Fiduciary relationship? Fiduciary relationship means relationship of trust, Directors hold fiduciary relationship with share holders. 203. How the Company Law upholds the fiduciary duty of directors? Under Company Law Director should disclose to Board contracts in which they are interested. For certain contracts in which Directors are interested Central Government approval is required.

Remuneration to Directors beyond certain limit require the approval of Central Government Remuneration to relatives of Directors requires approval f Central Government beyond certain limits. 204. What is capital maintenance concept? Since companys liability is limited, the only protection available to creditor is capital, so capital maintenance assumes importance. 205. What is the safe guard in Company Law for capital maintenance? 1. Reduction of capital requires the approval of Court 2. Buy back but for certain conditions is prohibited 3. Dividend can be paid only out of profits 4. Capital reserve cannot be distributed as dividend. 5. Directors are personally liable for payment of dividend out of capital.

206. What is Management by meetings? Since Company consists of shareholders and Directors, collective decision making is important. Thus meetings like shareholders , meeting and Directors meeting are important. 207. What is quorum? Quorum is the minimum number of persons to be present in person to constitute a valid meeting. In public limited company 5 share holders personally present constitute quorum, in private limited company two share holders personally present constitute quorum, in board meeting 1/3 of toal strength constitute quorum. 208. How many times board meeting to be held? Minimum 4 board meeting once in a quarter to be held. 209. How many time annual general meeting to be held? Once in a year an annual general meeting to be held and gap between two annual general meeting should not be more than 15 months. 210. When extraordinary general meetings are held? Extra ordinary general meetings are held on requisition by members are board of directors.

211. What is minutes? Minutes are written records of the proceedings of the meeting. 212. What are various types of capital? Equity share capital and preference share capital. 213. What is preference share capital? Preference share holders get preference over equity share holders in payment of dividend and capital that is why it is called as preference share capital. 214. What are various classification of capital? Authorised, issued, called up, paidup capital. 215. Company is managed by document? Company is an artificial person, so the mind of the Company can be ascertained through documents; such documents are filed with Registrar of Companies a Government official for public inspection. 216. How oppression of Minority shareholder is prevented in the Act? Certain important decisions can be taken by shareholders by passing special resolution that is th majority. Further issue of shares can be made only on prorata basis, Minority shareholder can go to court seeking redressal against oppression. 217. Why accounts gets so much importance for Companies? In Company form of business owner becomes outsiders. The only means by which they can know about their company is through accounts. That is why form of accounts is prescribed by law, as well as principle of full disclosure accounting standards and compulsory audit. 218. What is ordinary/ special resolution?

Ordinary resolution is passed by simple majority of share holders present in meeting, while special resolution needs th majority. 219. What are various types of business? There are two types of business ordinary/ special business. In ordinary business no explanatory statement is required, while in special business explanatory statement is compulsorily required. 220. Name little ordinary / special business? Declaration of dividend, adoption of annual accounts, appointment of auditors and directors in annual general meeting are ordinary business, while all other transaction in annual general meeting are special business all business in any other meeting are special business. 221. What is voting by show of hands? In voting by show of hands each member will have one vote irrespective of shares he possesses. Proxy cannot vote by show of hands. 222. What is meant by poll? In poll voting is done based on number of shares held. 223. What is proxy? In public limited company a member can appoint a proxy to attend on his behalf, a proxy need not be a member. 224. Who appoints Auditors? Auditors are appointed by share holders. 225. How many directors maximum can be there in Public Ltd company? 12 Directors are maximum numbers in Public limited company and this can be increased to 15 with prior permission of Central Government. 226. What is Dividend payment? Dividend can be paid only out of taxable profits, if dividend is paid out of capital Directors are personally liable for the same. Dividend once declared becomes debt due and has to be paid within 30 days, it cannot be cancelled. Share holders cannot claim dividend as matter of right without director declaring the same. 227. What is prospectus? If company decides to raise money from public, it should make available certain information to investors , this is done through document called as prospectus.

228. What about transferability of shares? Shares in public company are freely transferable, irrespective of change in share holders companies legal personality will remain same. 229. What are debentures? Debentures are instruments through which debt is raised. 230. Who is compliance officer for companies? Every company having paid up capital of more than 5 crores have to appoint Company Secretary and other companies have to take certificate from practicing company secretary regarding company law compliance and he is the compliance officer. Labour Laws 231 How exploitation is addressed through labour law? Children below age of 15 years are prohibited from employment No worker can be employed for more than 9 hours per day and 48 hours per week without payment of over time, even if over time is given the weekly hours cannot exceed 60 There cannot be a overlapping shift Nobody can work for more than 10 days without an holiday Overtime cannot exceed more than 50 hours per employee per quarter. All these are ensured by Factories Act For certain low paid workers, payment of wages should be made within a particular date. Only prescribed deductions from salary can be made and it cannot exceed 50% of wages These are ensured by payment of wages act. For establishment employing more than 100 workers certified standing order made compulsory under standing order act, which specifies misconduct in employment. Termination simpliciter is prohibited by industrial dispute act, which prescribes layoff and retrenchment compensation. Unfair labor practices are prescribed by Industrial Disputes Act. Minimum wages are prescribed for certain employment through minimum wages act. Bonded labour is abolished through bonded labour act.

232 How health is ensured through labor laws? Appointment of Certifying Surgeon has been made compulsory for certifying fitness of young person as well as occupational disease. Factories act prescribes minimum working space, ventilation, condition for artificial humidification, temperature

Pay with leave is given for sickness through ESI act. Maternity benefits are given for pregnant women through maternity benefit act. 233 How safety ensured through factories act? Women and Children cannot be employed near cotton ginning facilities. Moving parts of the equipment should be encased Safety equipment should be compulsorily provided for certain jobs. Workmens compensation act prescribes compensation for occupational injury/ disease. For organizations employing more than 1000 workers appointment of safety officers made compulsory.

234 How Welfare ensured through Factories act? Earned leave with wages is ensured through factories act Compulsory savings in the form of provident fund and pension for retirement done Gratuity is made compulsory for services in excess of 5 years Minimum bonus made compulsory For factories employing more than 250 employees canteen made compulsory For factories employing more than 150 work men rest room made compulsory. For factories having more than 500 employees ambulance made compulsory. For factories employing more than 30 women crche made compulsory.

235 How bargaining power of employees preserved through labour laws? Trade Union Act makes formation of trade union legal. Industrial disputes act makes collective bargaining and under certain circumstances strike legal.

236 What is Child/ adolescent/ child? Child means a person who has not completed 15 years of age, adolescent are those who is more than 15 years and less than 18 years, those who are 18 years and above are called as major.

237. Who is a worker under factories act? Workers are those who are employed in manufacturing or jobs incidental to manufacturing, those who are employed in administrative, managerial and supervisory capacity and apprentices are not workers.

238. What is manufacturing process? Manufacturing process is given inclusive definition like cleaning, repairing, ornamenting, generation and distribution of electricity are included in manufacturing process, recording of information in electronic medium is specifically excluded from manufacturing process. 239. What is Factory? Factory includes precincts there of , where manufacturing process is carried on with aid of power with 10 or more workers, or without aid of power with 20 or more workers. 240. Who is an occupier? Occupier is a person who has ultimate control over the affairs of Factory, occupier need not be the owner, in case of companies if occupier is not notified all directors are deemed to be occupier. 241. What is leave with wages? First day of the month is holiday with wages, nobody should be allowed to work for more than 10 days without holiday, for adult worker who worked 240 days during previous year one day leave is earned for every 20 days of work and for adolescent worker one day leave is earned for every 15 days worked. 242. What is industrial dispute? Any dispute between employer and employee, employee and employee , employer and employer regarding , employment non employment and terms of employment is called as industrial dispute. 243. What is the difference between layoffand lock out? Layoff is beyond the control of employer like shortage of material, power etc, while lockout is a deliberate act. 244. What is retrenchment/ closure? Closure means closing the factory where all employer employee relationship comes to an end no factory which employs more than 100 workmen can close without permission from appropriate government. Retrenchment is removal of workmen without any stigma, it is different from dismissal. 245. What is Strike? Strike means refuse to do work by collective body of workers. It includes go slow, stay in strike. 246 . What is work to rule? Work to rule is doing work exactly as per rule.

247. What is works committee? Every factory employing more than 100 workers should appoint works committee consisting of equal number of employer and employee representative to amicably settle work related problems. 248. What are grievance settlement procedures? Grievance settlement authority has to be constituted by every factory and any grievance of workmen should be first referred to grievance settlement authority. 249. Who are all adjudicating authorities under industrial dispute act? Labour court, tribunal and national tribunal. 250. When the adjudicating authority can take cognizance of industrial dispute? When industrial dispute is referred by appropriate government the adjudicating authority can take cognizance. 251. What is conciliation authority under industrial dispute act? Conciliation officer and Board of conciliation are conciliatory authorities under industrial disputes act and they can only conciliate and cannot adjudicate any dispute. 252. What is court of enquiry? Court of enquiry is appointed to enquire about the dispute before the government refers the same to adjudicating authorities. 253. What is domestic enquiry? In domestic enquiry first a charge sheet is framed against an employee who is alleged to have committed misconduct a neutral person is appointed as enquiry officer, evidence should be led and copies of evidence should be made available to workmen, based on the same enquiry officer furnishes his finding to the disciplining authority and based on such report disciplining authorities decides the quantum of punishment. 254. What is payment of gratuity act? Payment of gratuity act 1972 is applicable to all factories, shops and establishment act employing 10 or more worker, any other establishment notified by Central Government. 255. What is the extent of gratuity payable? 1/ 2 of last salary drawn for each year of completed service. Supreme court has given beneficial interpretation to this provision whereby was interpreted as 15/26and in year of completed service means that any service above six months is rounded off to next number. Salary limit for gratuity was

removed in 1994 and all employees became eligible for gratuity, gratuity is payable to all employees who completed 5 years of service and above.

256. When compulsory insurance for gratuity is applicable? If number of employees exceed 500 then compulsory insurance to be taken for gratutity. 257. When gratuity can be forfeited? Gratuity can be forfeited for employees riotous or disorderly conduct or any offence involving moral turpitude in the course of employment. 257. What are covered establishment under payment of bonus act? Covered establishment are any factory or any other establishment establishing 20 or more workers any day during previous year. 258. Who are eligible employees under payment of bonus act? Employees drawing salary up to Rs 3500 per month are eligible employees under payment of bonus act. 255. Whether loss making enterprise is liable to pay bonus? Loss making enterprises are liable to pay bonus up to 8.33% of salary even if it a loss. 256. What is maximum bonus? Maximum bonus is 20% of salary. 257. What is bonus holiday? A new establishment is exempted from payment of bonus for 5 year period if they dont have available/ allocable surplus. 258. How many days in a year an employee should work to be eligible for bonus? An employee should work minimum 30 days in a year to be eligible for bonus. Even part time employees are eligible for bonus, but apprentices under apprenticeship act are not eligible for bonus. 259. What is set off and Seton? If the company pays minimum bonus then it can carry it forward and setoff against allocable surplus in next four years. If the allocable surplus exceed maximum bonus it can be carried forward up to 20% of salary and can be allocable surplus for next four years. 260. When bonus can be forfeited?

If an employee is dismissed for riotous conduct or offence involving moral turpitude in course of the employment is dismissed or if the employee causes loss to property of employer his bonus can be forfeited. 261. What is minimum wages act? For certain scheduled employment minimum wages are fixed by state government as per the advise of advisory board. 262. How many members are necessary to form trade union? Seven members are needed to form trade union, out of the office bearers only 50% should actually work in the company, absence of secret ballot to ascertain members of trade union leads to multiplicity of union, leading to industrial disputes due to inter union rivalry. 263. To whom ESI act is applicable? ESI act is applicable to employees having wages up to Rs 6500. 264. To which establishment ESI act is available? ESI act is applicable to Factories or any other notified establishment having more than 20 workers. 265. To which establishment employee provident fund act is applicable? EPF act is applicable to any factories or other establishment employing 20 or more employees notified by Central Government or to any other establishment employing less than 20 employees notified by Central Government. 266. To which employees EPF act is applicable? To employees drawing salaries up to Rs 6500 per month EPF act is applicable. 267 What are the objectives of shop and establishment act? Shop and establishment act is applying labour laws like halth, welfare, timing to unorganized sector like shops, show rooms, club etc. 268. What are the objectives of contract labour regulation and abolition act? The objective is to apply health, welfare safety and leave with pay to contract labour like regular employees as well as to abolish contract labour in perennial jobs. Contractors employing 20 or more contract labour are required to be license.

269. What is UNCITRAL?

United Nation Commission for International trade law, which enacts model trade law and IT Act 2000 is one such law. 270. When IT act was enacted? In the year 2000 IT act was enacted. 271. To what documents IT Act 2000 do not apply? Wills, trust, negotiable instruments and transfer of immovable properties. 272. Who is an Originator, addressee and intermediary? Originator is a person who originates electronic information like sender of Email. Addressee is the person who receives the email. Intermediary is any body like a ISP like rediff, yahoo or even search engine like google When originator and addressee are dynamic intermediary is static position 273. What is digital signature? Digital signature is a signature authorized by a certifying authority , it consists of key pairs private and public, private key identifies the originator, it transfers information in encryption format only the addressee who has public key can receive the information in meaningful format by applying public key. 274. Who is certifying authority? Certifying authority is authorized by controlling authority. 275. What are the act amended by IT act? Postal act, evidence act, criminal procedure code and RBI Act are amended to include electronic documents. 276. What is E-Governance? Citizen filing various electronic approvals to authorities and getting approval is called as E governance. 277. What is Electronic signature how it is different from digital signature? Electronic signature may wary by different technology, but the act only recognizes digital signature which will be given by certifying authority. 278. What are various forms of digital signature for individuals? For individuals it is class B & C certificate, while Class B is less rigorous which is used for sending transactions like authorized Email.

Class C is more rigorous and used for making transaction like E Banking. 279. Who is controlling authority? Controlling Authority authorizes certifying authority and decides on cyber contraventions. 280. What is the difference between Cyber contravention/offence? Cyber contravention is unauthorized access either physically or virtually to others computer without any intention to damage while cyber crime is such access with intention to damage. 281. What is the remedy for Cyber contravention? To apply to cyber controlling authority under section 42, he can levy fine upto Rs 1 crore if such contravention is confirmed. 282. What are Cyber offences? Cyber offences are under section 65, 66 , 66A, 67 & 67B. 283. What is tampering with source code? Source codes are instructions to computer which can be in machine readable form or high language or even a flow chart, tampering with source code with intention to create dame is punishable with 3 years rigorous imprisonment and 2 lakhs fine, it is cognizable and non bail able offence. This is under section 65 284. What is hacking? Hacking is unauthorized access to computer either physically or virtually, if it is authorized intervention it is called as ethical hacking, if it is unauthorized intervention it is called as cracking, it is cognizable and non bail able offence, it can be punished with three years rigorous imprisonment and 2 lakhs fine. This is under section 66.

285. What is defamation? Under section 66A enacted in 2008 any message in electronic message grossly irritating and menacing is made as cyber crime which is cognizable and punishable up to 3 years, it is bail able, But Indian penal code has laws for slander and libel, which are criminal offences but the party can be sent to jail only if court convicts him, truth is a defence, normally it is for the party who alleges a fact should prove it is true, but if one of the party is a public figure then it is for him to prove that it is not true. 66A is a serious attack on the freedom of speech of the citizen, considering the fact that grossly irritating or menacing is not defined by the act and left to police officers to define the same. The constitutional validity of this is now tested before Supreme court and the verdict is awaited.

286. What is Obscenity? Obscenity is covered by section 67, if anybody publishes in cyber space obscenity without any cause then it is cognizable offence which is non bail able and punishable with rigorous imprisonment of 3 years and fine of 2 lakhs. 287. What is Child pornography? In Indian IT act section 67B defines child pornography in very wide manner, even clicking in website with child pornography is an offence first time it is punishable with imprisonment of 5 years and fine of Rs 1 lakh, it is bail able, subsequent offences are punishable with 10 year imprisonment and not bail able. This is covered under section 67B 288. How IT act deals with invasion in privacy? Section 72 deals only with authorized persons like controlling authority disclosing information unauthorized as offence, but it did not deal with cyber invasion of privacy. 289. What are various ways in which privacy is invaded in cyber space? Cookies, GUID, Web bug, email, document bug, spy ware, digital profiling 290. What is cookies? Cookies get incorporated in hard disc while downloading information, it tells which are all the website visited and information searched so that the marketers can tie their advertisement to suit the same. 291. What is GUID? Globally unique identifier, this is incorporated in Ethernet card of LAN to eaves drop. 292. What is web bug? It is incorporated in a block advertisement in a website, so whenever a website is clicked the said advertisement is displayed before the website is reached. 293. What is Email/ document bug? If Email bug is incorporated then it is possible to find out whether the other party has opened your document or not. In case of document bug it is possible to ascertain whether the addressee has opended the attached document or not. 294. What is spyware? Spy ware is incorporated in software to trace surfing habit.

295. What is online digital profiling? It is incorporated in block advertisement in website, if it is clicked it incorporates cookie in hard disk to track online surfing. 296. What is phishing? Phishing is collecting confidential information through unauthorized web site which resembles authorized website, like income tax department website to misuse the same. 297. How cyber contraventions are tried? Cyber contraventions are tried by controlling authority appointed under cyber law, against whose actions appeal can be preferred to cyber appellate tribunal. 298. What is Cyber appellate tribunal? Cyber appellate tribunal is one man tribunal which usually holds its sittings in Delhi, but can sit anywhere else. It is appellate authority of orders of controlling authority. 299. How to try a cyber crime? Cyber crimes are tried in front of first class judicial magistrate or sessions judge. 300. What are remedies available for cyber invasion of privacy? Cyber invasion of privacy is still triable under Indian Penal code and not under Cyber law, this is serious lacuna in cyber law. 301. What is ICERT and what is its role in blocking website? ICERT Means Indian Computer Emergency Response Team and it is notified that it is authorized block websites which are against national security from February 2003. 302. What is application of copyright law? Copy right law is very much applicable to web , which ever ISP or website distributor who helps to download copyright material without ascertaining the identity of end user can be charged for copyright violations. 303. What is taxation of ecommerce transactions? E commerce taxability is in embryonic stage with many dispute like whether a server or website will constitute permanent establishment and where to tax e goods like software, books and music which are downloaded. 304. What is section 80?

Section 80 gives wide power to cyber inspectors to enter any internet centre to search whether they give access to obscene site, such wide powers have led to unintended consequence of cyber hafta. 305. How Right to information act came into existence? Supreme court held in several cases that freedom of speech which is a fundamental right in constitution includes right to information. 306. What is the law which government activities before right to information act? Before right to information act government activity was considered as secret under official secret act 1923 and trying top get government information was considered as criminal offence. 307. When Right to Information Act was enacted? Right to information act was enacted in June 2005. 308. What is information? Information includes electronic information, including any information of private body which can be accessed by public authority under law. 309. What are public authorities? Any authority established under constitution, laws passed by Parliament or State legislature, body owned and financed by appropriate government, Non government organization substantially financed directly or indirectly by appropriate government. 310. Who are information officers? Within 100 days of enactment of act public authority has to appoint Central public information officers, state public information officers. 311. Within what time the information sought should be furnished? Within 30 days the information sought in writing should be furnished, in the case of information pertaining to life or liberty of person it should be furnished within 48 hours. 312. When the information sought can be refused? If the information is furnished It will affect prejudicially sovereignty and integrity of India Affect relationship with foreign state Breach of privilege of Parliament or State legislature Cabinet papers before the decision is made

Contempt of Court Information obtained in fiduciary capacity or if disclosed will affect competitive position of any party unless the appropriate authority thinks that the public interest outweigh private inconvenience.

313. What is information pertains to third party? For information which pertains to third party notice should be given to third party within 5 days and 10 days time to be given to third party to raise any objection. 314. What is the appeal provision under right to information act? Against the orders of public information officer appeal can be filed with senior officer within 30 days and against the order of senior officer appeal can be filed with Central or state information commission in 90 days. 315. What is the penalty provision under the act? If the application is not received, or if the information is denied due to mala fide reasons, if the information sought for is destroyed or if obstruction is placed penalty is levied at Rs 250 for every day of delay subject to maximum of Rs 25,000. 314 To which organizations RTI is not applicable? Intelligence organization notified in second schedule this act is not applicable. 315. When competition act enacted? Competition act enacted in 2002. 316. What is agreement? Oral, written, express implied agreements are agreements. 317. How dominant position can be abused? Cartel, price rigging, tie up arrangement, boycott, exclusive dealership, territorial restriction, predatory pricing, resale price maintenance. 318. What is cartel? Few persons joining together to restrict, production, distribution and sale of goods are services is cartel, but agreements like joint venture which increases production of goods/ service do not fall into this category. 319. What is price rigging?

Few people joining hands to create artificial demand in any goods are service. 320. Tie up arrangement? Fast moving goods are tied with slow moving goods so that one should be purchased compulsorily when other is purchased. 321. What is boycott? A joint agreement to boycott any persons goods are services. 322. What is exclusive dealership? A dealer is restricted from dealing with the products of competitors. 323. What is territorial restriction? Each dealer is allotted a particular territory only. 324. What is predatory pricing? Charging abnormally low price to drive out competition and establish monopoly. 325. What is resale price maintenance? Specifying price below which the product cannot be sold. 326. How the commission investigates abuse of dominant position? Commission investigates abuse of dominant position suomotto or on a complained filed through Director General of Investigation. 327. How competition is restricted through combination? If any person acquires other person due to which the combined asset exceeds 1000 crores or combined turnover exceeds 3000 crores. In the case of foreign acquisition combined asset exceeds 500 million $ or combined turnover exceeds 1500 million $ In case of group in case of domestic acquisition limits are 4000 crores are 12,000 crores In case of foreign acquisition it is 2 billion $ or 6 billion $. Within one week of approval of such acquisition competition commission should be informed. Acquisition will not be valid with out approval of competition commission. 328. against the order of competition commission to whom an appeal should be made?

Against the order of competition commission appeal to be made to competition appellate tribunal and next appellate authority is Supreme court, no other courts have any jurisdiction other than writ jurisdiction.

FEMA 329 What is capital flight? Capital flight means capital moving out of the country 330 What are the methods by which capital flight takes place? Under invoicing, over invoicing and hawala 331. Who are authorized person? Authorised person are Authorised dealer, money changer and restricted money changer. 332. Who are authorized dealer? Authorised dealers are persons who can transact widely in foreign currency like buying, selling foreign exchange, opening foreign currency account, remit foreign exchange , open LC. Usually banks are authorized dealers 333. Who is a money changer? A person who can buy and sell foreign currency is a money changer. 334

Who is restricted money changer? A person who can buy but not sell foreign currency is a restricted money changer 335. What are current account transactions? Import and export of goods, import and export of services and transfer payments. 336. How FERA monitors capital flight transactions? FERA monitors current account transactions, through various forms by which value is declared like GR, SDF, SOFTEX and PP, for exports and bills of entry for imports , through customs. 337 What is capital account transaction? Borrowing, lending in foreign currency , foreigners investing in India and Indians investing abroad. 338. State the difference between FERA & FEMA? FERA Fema Regulator Facilitator Criminal consequence Civil Consequence Restricts current as well as capital account Restrics capital account Discretionary Rule based Residence is based on intention Residence is based on definite criteria Service exports not defined Service exports defined 339. What are two markets for foreign exchange in India? Wholesale or interbank market, retail or merchant market. 340. What is an intervention currency? Intervention currency is the currency through which value of various currencies is ascertained in foreign exchange market, Indias intervention currency is $. 341. What is FEDAI? Foreign Exchange Dealers Association of India. 342. What is LERMS?

Liberalised Exchange Rate Management system, which is nothing but dual exchange rates. 343. What are FCNR (A) accounts? FCNR (A) accounts are deposits taken by public sector bank at the instant of Government of India in any one of four foreign currencies $, ,, DM, interest exempt from tax, both principle and interest are freely repatriable, here foreign exchange risk is borne by Government of India through RBI. 344. What is FCNR (B) account? Same as FCNR (A) except that instead of DM deposits are taken in Euro. Here exchange risk is borne by the bank and not by government of India. 345. What is NRE account? In this the NRI keeps the accounts in Rs and bears exchange risk, interest is exempt from tax, interest and principle are freely repatriable. 346. What is NRNR account? This is like NRE account where only interest is repatriable but the principle is not, here also the interest is exempt from tax. 347. What is NRO account? NRO accounts are accounts in which neither the interest, nor principle is repatriable. But interest is exempt from tax. 348. What is EEFC account? EEFC account is exchange earners foreign currency account in which exporters are allowed to keep their account in foreign currency. 349. What are RFC accounts? Where a non resident Indian comes back to India for good, he is allowed to keep his accounts as such in abroad to discharge his obligation , up to seven years after returning to India, this is known as nonresident foreign currency account. 350. What is RFC domestic account? In RFC domestic account a resident can keep Foreign currency obtained up to 2000$ and anyother foreign currency obtained. 351. How much foreign currency can be taken for travel? 10,000$ per year. Other than Nepal and Bhutan.

352. How much foreign currency to be taken for business travel? 25000$ per year 353. Which is prohibited transaction for current account? Betting is prohibited transaction for foreign currency remittance under current account. 354. Which transaction needs prior approval of Central Government? Remittance for cultural tours needs prior approval of Central Government. 355. How much money can be remitted for foreign education? For foreign education 1, 00,000$ can be remitted per year and in addition maintenance of 25,000$ per year can be made. If NRO account is there one million $ can be remitted out of the same. 356. How much money can be remitted for foreign investment? Foreign investment 1, 00,000$ can be remitted per annum. 357. How much money can be remitted for foreign medical treatment? 1, 00,000$ per annum with 25000$ per annum per year with maintenance. 358. What is FDI/ FPI? FDI is Foreign Direct Investment where Foreigners invest directly in companies, while FPI is Foreign Portfolio Investment in which investment is done through stock exchange. 359. What are various means of Foreign Direct Investments? Greenfield which is building up new facility, brown field which expanding existing investment. 360. What is FIPB? Foreign Investment Promotion Board which prescribes caps in foreign investments for various categories of investments. 361. What is FII? FII are foreign institutional investor who is registered with regulators in their country. Only a FII can invest in Indian secondary market. 362. What is sub account? FII can open sub accounts and issue participatory notes to collect money from various entities not registered with regulators, the identity of these investors need not be disclosed.

363. What are the limits for FII? FII cannot hold more than 10% of capital of an entity and together they cannot hold more than 24% capital of entities, they can exceed these limits upto sectoral cap if the entity gets the approval through special resolution. Thus hostile takeover by foreign entity is ruled out. 364. What are the recommendations of first Tarapore Committee? First Tarapore Committee set pre condition for full convertibility like fiscal deficit being 3%, inflation within 3% and NPA not exceeding 5% of bank advances and effective financial supervision. 365. What are second Tarapore Committee recommendation? Gradual approach to full convertibility like liberalization of gold imports, allowing Indian exporter to hold foreign currency accounts, symbol for rupee. Many have taken place, the target date set by committee for full convertibility that is 2009 also gone by, high fiscal deficit and ravaging inflation stands in the way of full convertibility.

Security Law 366. What are the laws dealing with securities in India? SEBI Act and Securities contract regulation act 367. Who are the primary market intermediaries regulated by SEBI? Bankers to the issue, merchant bankers, underwriters, Registrar 368. Who are secondary market intermediaries regulated by SEBI? Brokers, sub brokers, demat depository participants, mutual funds, credit rating agencies 369. Whether speculation permitted in India? Yes through futures and option trading. 370.

What are the powers exercised by SEBI over stock exchange? SEBI has the power to supersede governing body of stock exchange. 371. What is demutualization? Corporatization of stock exchange from status of Association of persons is called as demutualization of stock exchange. 372. Who is the appellate body for orders passed by SEBI? Security Appelate Tribunal or SAT.

373. To whom a person can apply against orders passed by SAT? Supreme Court. 374. When SEBI was constituted? SEBI was constituted in the year 1988 as a division of ministry of Finance, in 1992 SEBI act was passed by Parliament. 375. What is listing? Listing is an agreement between The company and stock exchange for trading of companies shares in the exchange. 376. What are the various powers of SEBI? 1. SEBI has the power to regulate all market intermediaries 2. It has the powers to prevent any intermediary to participate in market. 3. SEBI Guidelines has the force of law 4. SEBI does investor education. 5. Power to approve prospectus.

377. What are penalties leviable under SEBI Act?

Penalties can be classified in to two categories Failure in compliance or delay in compliance with SEBI Regulations 1 lakh per every day subject to maximum of Rs 1 crore. Making illegal profits in exchange in contravention of SEBI guidelines, three times such profit or 25 crores whichever is higher. 378. What is insider trading? Trading in price sensitive unpublished information by an insider.

Consumer protection Act 379 What is the purpose for which consumer protection act? Consumer protection act is based on caveat vendittor, it protects consumer against unfair trade practice.

380 Who is a consumer? Consumer is a person who do not purchase goods for commercial purpose. Free services are not covered.

381. What are various consumer forums? District, state forum and national commission

382. What is the advantage of consumer forum?

It has the benefit of experts other than judicial member sitting there. Consumer association can represent the consumer. The proceedings do not have the trappings of civil court. No stamp duty on plaint. Deficiency in goods and services are investigated. High monetary jurisdiction conferred on district forum. 383. What is the basic principle guiding consumer protection Act? Basic principle guiding consumer protection act is caveat Vendittor , let the seller beware.

384. What are various consumer protection act passed in India before consumer protection act? Prevention of food adulteration act 1954, Essential Commodities Act 1955, Trade and Merchandise Mark Act 1958, Standard weights and measurement act 1976.Prevention of black marketing and maintenance of supply of essential commodities act was passed in 1980., MRTP act 1969. 385. Who can file complaints before consumer forum? Consumer, consumer forum, Central, State Government. 386 What is the composition of district forum? District forum has original jurisdiction only, it has monetary jurisdiction of Rs 20 lakhs , it is headed by a retired District Judge and has two other members One of the member must be women social worker. 387., What is State commission? State commission has retired judge of high court has Chairman and two members who are subject experts and one of whom is a women. Original jurisdiction of state commission is for claims greater than 20 lakhs but t less than or equal to Rs 1 crore. It has appellate jurisdiction over any order passed by consumer forum. 388. What is National Commission? National Commission consist of retired supreme court judge as Chairman and four other members. It has original jurisdiction over any claim exceeding 1 crore and appellate jurisdiction over any order passed by State Commission. 389. What are the cases in which compensation can be claimed before consumer forum? Defect in goods and deficiency in service. 390. What is defect? Defect is any imperfection in potency, purity, standards prescribed by any law or claimed by way of any contract express and implied.

391. What is service? Service has inclusive definition it includes banking, telecommunication, electricity, amusement, entertainment but excludes personal and free service. 392. Whether complaints can be lodged about deficiency in services of Government Agencies? Yes complaint can be lodged against deficiency in service of government agencies, other than in performance of sovereign services. 393. Whether notice required to be given under section 80 of CPC is required to be given for filing complaints against Government agencies in consumer forum? No need to give notice under section 80 of CPC before filing complaints against government agencies in consumer forum. 394. Against the order of National commission what appellate remedies are available? Against the order of National Commission appeal can be preferred to Supreme Court on payment of Court Fee stamp of Rs 250.

Transfer of property Act 395 What is an immovable property? Immovable properties are properties which are permanently embedded to earth. 396 Transfer of property involves transfer of property between persons intervivos what does it mean? It means between two living persons. For this purpose artificial juridical persons like companies are considered as living persons. Transfer of estate after death by a testamentary document or otherwise is not covered by transfer of properties act.

397. Whether transfer of interest in immovable property requires registration? Transfer of immovable property exceeding Rs 100 in value as well as any interest in immovable property for 12 months and above require registration. 398.

Whether Registration guarantees title to the property? No 399. What is rule against perpetuity? Law views with disfavor any clog in transferability of the property, if a property is transferred to living person at the date of transfer without right to alienate the same and transferred to an unborn person on the date of transfer who will come into existence at the time of vesting of property, the maximum period for which the vesting can be postponed is till the minority of person, any restriction alienation beyond this period is null and void. 400. What are constructive notices? Registration is constructive notice, possession of document of title is constructive notice, possession is constructive notice. 401. What is doctrine of election? If a property is transferred through a deed and it also contains a onerous condition, the person can either accept the property with onerous condition, or reject the property, he cannot accept the property and reject the onerous condition. 402. What is the difference between execution and attestation? Execution is signing while attestation means witnessing; Execution raises a presumption that the person knows the content of document, attestation raises no such presumption, it only verifies the signature, unless a deed to which party is illiterate or pardanashin women. Where the attester should state that he explained the content to the party and endorse it along with attestation. 403. What is Lis Pendens? If any litigation is pending regarding the title of the property, the transferee should take the same subject to litigation. 404. What is Actionable claim? Actionable claim are debt arising in the course of trade which is not secured on immovable properties. Actionable claim can be assigned in writing. 405. What is mere right to sue? Spec successionist, mesne profits are mere right to sue which cannot be transferred. 406. What is fraudulent transfer?

If immovable properties are transferred without adequate consideration under section 53 to defeat the claims of creditors, such transfers can be declared as null and void by the court.

407. What is a Mortgage? Mortgage is transfer of interest in property. 408. Explain various types of Mortgages? Simple Mortgage: It involves transfer of interest in property, the mortgagee cannot sell property without court intervention English Mortgage: English Mortgage involves transfer of title in favour of mortgagee. It has to be transferred back to the Mortgagor, whenever the Mortgagor pays back the loan. Mortgage by conditional sale: In this the title is transferred to Mortgagee and the transfer becomes absolute, if loan is not repaid within specified date. Usufructory Mortgage: Here the mortgagee is only entitled to usufruct ( proceeds ) of mortgaged property Equitable Mortgage: In notified towns this type of mortgage can be created by deposit of title deeds with mortgagee in writing.

409.

What is power of attorney transfer? A person can transfer immovable property in part performance of contract under section 53A of contract, it is called as power of attorney transfer.

410.

What is lease?

Lease is transfer of interest in property, a lease transfers definite interest in the property in favour of lessee , but title remains with lessor, lease for twele months or above needs compulsory registration. 411. What is License?

License is a right to occupy the property of others , without any right transferred init, lessor can still occupy a portion of property.

412 What is a patent? Patent is granted for inventions involving novel industrial application. Mere scientific principle which has no industrial use cannot be patented. Patent give 20 years exclusive right to patentee to manufacture or license the project. 413. Who is first inventor? First inventor is employer in case of employee who has a contract with employee that any scientific discovery in the course of employment will be the property of employer. 414. What inventions cannot be patented? Mere scientific theories, frivolous inventions, inventions against natural laws and accepted moral principles, agricultural implements, surgical and medical implements, new use for existing substance, a compound of known substance. 415. What are the grounds on which patent can be refused? Traditional knowledge, prior usage and publication before patenting. 416. What is patent search? Patent search is search of database to ascertain whether the patent is already filed. 417. What is patent examination? Every patent office has a patent examiner, who examines patent application to find out any prior application is there. 418. What is provisional specification? Provisional specification is a broad specification filed with patent application, provisional specification is followed by final specification with in 12 months. 419. Whether a patent can be rejected for improper specification? Yes.

420. Whether Patent Priority date is international? No patent priority date is national, that means separate patent to be filed for each nation, But if a country is a signatory to Patent Cooperation Treaty , it can get priority in other members upto six months for filing the application. 421. What is Patent opposition? Patent office will publish patent inviting opposition. 422. Which is the court which can take cognizance of intellectual property infringement? District court is lowest court in which proceedings can be taken for intellectual property infringement. 423. What is the relief granted? Injunction, damages. 424. What is mail box/ EMR? India was given 10 years time to be compliant with patent rules, it signed Dunkel agreement in 1995. In this ten year India established in 1995 mail box which will determine the order of priority of patent when patent agreement and exclusive marketing rights for drugs and agricultural chemicals during the period. 425. What is Sui Generis? Even though seeds can be patented, farmers can use the seeds they have for cultivation.

426 What is copyright? Copy right is given for exclusive use of artistic, literary and software work, photography It is for a period of 60 years after the death of the author. 427. What is the protection period for software algorthims? 60 years after publication. 428. What is the protection period for anonymous pseudonymous publication. 25 years after publication. 429. What is protection period for performance? 25 years.

430 What is design? Like patent for industrial process a design can be registered under design act for exclusive usage. 431. What is Geographic Indicator/ Certain Regions are famous for certain products like Tirupati Ladoo, Kancheepuram silk sarees. The producers in these regions can register to claim exclusive usage of the regions name before product. 432 What is trade mark? Trade Mark is a word, picture , sign , colour which indicates the connection between the brand and the manufacturer, thus exclusive use of trade mark right is given for 10 years to the person registering the trade mark, else passing off to be proved, which is very difficult legally. 433. What is certification trade mark? Certification trade mark are the marks which indicates the relationship between certificate and certifying organization. 434. What is service mark? Service mark indicates connection between service and service provider. 435. What is registration of trade mark? Registration of trade mark means the mark entered in Part A or B of Register, Part A registration provides higher protection.

436. What is trade secret? Trade secret is not recognized in India. In patent to get exclusive rights patent specification to be given, which is not there for trade secret?

Arbitration and conciliation Act

437. What is the use of Arbitration and conciliation Act? Arbitration and conciliation act is needed for settling commercial disputes, since these disputes are not akin to litigation and common grounds for settlement to be found. All arbitration agreement should be in writing. They will be conducted in place and according to law specified in the agreement 438. Whether Arbitration clause should be written in agreement itself ? No arbitration can be inferred by telex, letters etc. 439. Once the court finds that there is an arbitration agreement can it proceed with adjudication? No it has to refer to arbitration tribunal. 439. What are disputes which cannot be subject to arbitration? Criminal act and acts for which special law exists like divorce. 440. What should the composition of arbitral tribunal;? Arbitral tribunal should not have even number of arbitrators. 441. Who will decide the jurisdiction of arbitral tribunal? The tribunal itself should decide the jurisdiction; the question of jurisdiction should be raised before filing defense. 442. Whether Tribunal is bound by Indian Evidence Act or Code of civil procedure? No the tribunal is not bound by Indian Evidence Act and code of civil procedure , it can frame its own procedures. 443. When the parties fail to appoint arbitrators who can appoint arbitrator? In case of domestic arbitration the Chief Justice of High court in which dispute arises or in the case of international arbitration Chief Justice of India should appoint. 444. Whether Arbitral Tribunal has the power to award cost? Yes Arbitral tribunal has the power to award cost. 445. Whether Arbitral Tribunal has power to award interest? Yes, in the absence of ant specific provision in the agreement it is 18% per annum.

446. How the Arbitral award will be enforced? As a decree of civil court. 447. How Arbitral tribunal can enforce attendance of witness? It can with the help of civil court issue commission for attendance of witness. 448. What is difference between arbitration and court proceedings? Court proceedings decide issues, while arbitration resolve issues. 449. What is conciliation/ mediation? It is reconciliation between parties by expert mediators, conciliation can be declared as award under the act. 450. Who will fix fees of arbitrators? Parties will fix the fees, in the absence of agreement Central Government will fix fees. 451. What is Fast Track arbitration? In fast track arbitration time limit can be fixed for each activity, it has to be concluded within 6 months it can be extended by consent of parties for another three months and beyond 9 months either the arbitration is dissolved or if parties agree can take place under supervision of high court. 452. Whether Arbitral Tribunal can issue interim award? No Arbitration tribunal cannot issue interim award, but court can issue the same. 453. What are the cases where arbitration award can be set aside by court? The arbitrators are neutral, have not followed proper procedures or exceeded the terms of reference. 454. What is place of arbitration and law governing arbitration? Place of arbitration and law governing arbitration should be specified in arbitral agreement, else it will be India and Indian Law. 455. What is Foreign award? Foreign awards are awards issued other than based on Indian Law.

Banking Act

CRR/SLR requirements are prescribed under what act? 456. RBI act 1934

457. A bank can hold immovable property not connected to its business for how many years? 7 years 458. Which is the only interest rate controlled by RBI? Interest on export 459. What is REPO? Rate at which Banks borrow from RBI through approved security. 460. What is reverse repo? Reverse Repo is the rate at which RBI borrows from bank by using approved securities. 461. What is call money notice money? Call money is interbank borrowing for period not exceeding 24 hours, notice money is interbank borrowing for period exceeding 24 hours, but not exceeding 14 days. 462. What is the regulatory approach by RBI prior to 1990? Prior to 1990 RBI use to micromanage by prescribing securities, prescribing loan and deposit interest rate, sitting in the Boards of Bank day to day inspection of bank. 463. What are the risks faced by bank? Interest rate risk, market risk, liquidity risk, operational risk, foreign exchange risk, credit risk, legal risk, reputation risk and systematic risk. 464. What are the current approach followed by RBI for supervision? Most supervising activities shifted from onsite to offsite, based on risk onsite supervision is carried out, RBI prescribes various measures for measuring and managing risk, thus regulations has become risk rather than operations oriented.

465. What is provision for managing systematic risk? Capital adequacy is the provision for managing systematic risk. 466. Describe three tier structure of Indian Bank? Commercial Bank, Regional Rural Bank and cooperative banks. 467. Which is the weakest link in Indian Banking system? Cooperative bank which has stand alone structure and operates under State official supervision is the weakest link in banking structure. 468. What are the technological aspects of banks? Any time banking, any where banking, NEFT, RTGS , ECS, EDS etc. 469. How much profit should be compulsorily transferred to reserves under banking regulation act? 20% 470. What are the powers given to RBI to regulate bank? RBI licenses new banks, prescribes CRR &SLR, Has power to supersede board, RBI regulations have to be compulsorily followed by bank, financial statement format prescribed by RBI, RBI appoints auditor. 471. What is the difference between regulations in developing and developed countries? Developing countries focus on regulating unsystematic risk, while developed countries tackle systematic risk like too big to fail and asset bubble. Thus due to regulation of unsystematic risk development of financial innovation in developing countries is low. Civil/ Criminal Law 472. What is the difference between civil and criminal law? I n civil law individual rights are affected and no harm is done against society. But crime is a harm against society and prosecuted by the state. 473. What type of courts deal with civil cases? Civil courts and district court deal with civil cases. 474. What type of Courts deal with Criminal cases? Magistrate court like Second class, first class, metropolitan magistrate court, chief judicial magistrate court, executive magistrate court, session court deal with criminal case. 475. What is jurisdiction/

The matters which the court is to try are called its jurisdiction, jurisdiction can be pecuniary or territorial or both. 476. What is charge? In criminal case if the court finds that the charges are weak it can discharge the accused, hence it will frame the charge to continue the proceedings. 477. What is cognizable offence? It is an offence in which the police officer is entitled to arrest the offender without any warrant from Magistrate. 478. What is non cognizable offence? In an offence where the police officer cannot arrest the accused without a warrant from Magistrate is non cognizable offence. 479. What is bailable offence? Offence in which bail can be granted to the accused against surety or security is called as bailable offence, anticipatory bail can be sought by accused who apprehend arrest. 480. What is non bailable offence/ Offence which involves death penalty, life imprisonment or conviction in excess of 10 years are non bailable. 481. What is examination in chief? Examination in chief is examination of witness produced by party by his council. In examination in chief leading questions cannot be asked. 482. What is leading question/ Leading questions are those which contain the answer expected. 483. What is cross examination? Cross examination is examination of witness by one party the council of other partys council. There is no prohibition for leading questions in cross examination. 484. What is protection given by constitution against self incrimination? Constitution prohibits any person to be witness against himself, if any questions are asked if answer given will go against the party he has a right to make silence. 485. What is perjury?

Any witness telling a lie after taking oath before a court is an offence called as perjury. 486. What is admission? If any party admits the statement alleged by other party it is called as admission in civil proceedings leading to summary proceedings. In criminal proceedings if party admits to charges stated by him in FIR it ia confession. But confession before police officer is invalid. Confession leads to summary trial. 487. What is conviction/ acquittal? If the judge considers that charges framed against accused are proved beyond reasonable doubt he convicts the accused, else he acquits him. 488. What is burden of proof/ onus of proof? A person who alleges something against other person should prove it beyond reasonable doubt and other person need not prove his innocence is the basic principle of law, this is called as burden of proof, but during the course of trial once a person prima facie discharges his obligation the onus of proof shifts several times. 489. What is plaint? Plaint is the application filed by the person seeking relief before court. 490. What is FIR? FIR is First Information report filed by police officer before Magistrate Regarding the crime. 491. What is exhibit? Exhibit contains all oral and written evidence and witnesses relied on by plaintain. 492. What is objection? Objection is filed against plaint which rebuts the contention of plaintiff, it specifies documents and witnesses the defendant relies on to nullify the content of plaintiff. 493. What is rejoinder? Rejoinder is plaintiff reply to defendants objection. 494. What is summons? Summons are issued by court for appearance of opposite party or some times the witness. 495. What is warrant? If a person ignores summons from court, it can issue warrant to police officer to arrest and produce him in front of the court.

496. What is Commission? Commission is issued to witness to produce documents in his possession. 497. What is discovery? Discovery is issued to find whether any documents relevant to case is in possession of the person. 498. What are interrogatories? Interrogatories are question issued by court to a party for his answer. 499. What is search under criminal procedure code? A search of any place in criminal procedure code can be done under the warrant of court, in presence of two respectable witness, all seizure of goods should be backed by panchanama. 500. What is compounding? If the law so provides any offence can be compounded in the form of fines by designated authority. 501. What is Juror system? The judge knows the civil law and criminal law, but he may not know the subject well, in juror system subject experts who donot have legal background sit as part of hearing and judges have to pass judgment in consultation with them. India do not follow juror system.\ 502. Who is Amicus curae? Amicus curae is a expert in subject market appointed as friend of court to help. 503. Why Judicial proceedings get delayed in India? Judicial proceedings gets delayed in India due to multiple adjournment, judgment reserved without specifying date of judgment and power of appellate court to quash the order of trial court and send it back to trial court for rehearing. Non computerization of judicial records whereby allotting numbers and hearing cases becomes discretionary leading to extensive corruption. 504 Who is a public prosecutor? Since in criminal cases state prosecutes it appoints public prosecutor. 505. What is limitation period for prosecution of offence? Section 468 of CrPc specifies that for offence involving only fine 6 months is limitation period For offences involving imprisonment up to 1 year 1 year is limitation period For offences involving imprisonment greater than 1 year but up to 3 years 3 years is limitation period.

For certain economic offences limitation period is fixed as 20 years. For civil law limitation is provided by limitation act.

505. How to serve notice issued by court? Notice served by court should be served on the person and his signature to be taken If it cannot be served on the person it should be served on any adult member of family Notice period on company should be served on principle officer If it is not possible then it should be pasted near the place he resides. If a person is absconding then the court has power to attach his property.

506 Whether right to appeal is inherent? No unless the statue provides for appeal. 507. Whether a judicial or quasi judicial authority can review his own decision? Once a judicial authority passes judgment he becomes functus officio, unless statute provides otherwise he cant even correct apparent mistakes in his order. 508. What is review? Higher authority can review the order of lower authority, while appeal is a right review is discretionary. 509. What is question of fact and question of law? On question of fact the tribunals decision is final, only appeal can be made to high court on question of law. 510. What is SLP? If a party wants to appeal against the order of high court then he can do so only when the High Court states it is a fit case for appeal, when High court refuse to state the case the party can move to Supreme Court under article 136 of constitution praying Supreme Court to Direct the high court to dtate the case this is called as special leave petition, the Supreme court has discretion to accept or reject the issue. 511. What is primary or secondary evidence? Primary evidence is original documents, while secondary evidence is the copy.

512. What is decree? Order passed by Civil Court is known as Decree. 513. Who is a decree holder and who is judgement debtor? The person in whose favour the decree is issued is called as decree holder, while the person from whom the damage should be recovered is called as judgment debtor. 514. What is statutory presumption regarding records maintained by public authority? Statutory presumption regarding records maintained by public authority in course of his duty is that it has been properly maintained. 515. What is hearsay? Any facts averred by a person based on what third parties have said other than by his own knowledge, generally hearsay is not considered as evidence , but in case of dying declaration hearsay evidence can be accepted. 516. What is the statutory presumption as per section 114 of evidence act? If party keeps silence to any question presumption will be answer if any given will be against party If any document in possession of party he refuses the produce presumption will be if it is produced it will be against party. If original documents which has been given as security for loan is discharged presumption is loan is properly discharged. If bill of exchange is held that it has been purchased for valuable consideration 517. What is privileged information? Information given to a judge in the course of hearing of the case Source of information for revenue or police official Information which is with public authority he can claim privilege with permission of HOD. Information communicated during course of marriage Information communicated between advocate and his client These are considered as privileged information under section 123 which he need not disclose in course of his examination as witness.

518. What is disproving character of witness? This is valid in criminal proceedings, an accomplice confession or evidence of witness whose character has been disproved should be corroborated by prosecutor. 519. What is LC? LC means letter of credit, in which the buyers bank assures payment irrespective of the fact whether buyer reimburses it or not as long as proper documents are presented. 520. What is UCPDC 600? UCPDC means Uniform Customs and Practices for Documentary credit which governs the operation of LC. It has 39 clauses, 600 is the version. It is prepared by International chamber of commerce head quartered in Paris. 521. What is bill of lading? Bill of lading is the proof that the shipper has taken the goods on the board of the vessel, there are various types of bills of lading like clean bills of lading which do not contain any notation on its face and claused bill of lading which contains notations on the face, LC generally accepts clean bill of lading and not clause bill of lading. There is onboard bill of lading and on deck bill of bill of lading, LC asks for on board bill of lading and on deck bill of lading is not accepted due to risk involved. If LC permits short form of bill of lading will be accepted, it do not contain all terms of the contract of carriage, non negotiable bills of lading are not document of title and they need not be produced for clearing the goods, they are usually used for shipping to sister concerns.

522. How goods should be described in bill of lading? Description of goods in bill of lading can be general and should not contradict description of goods in LC. Port of shipment and discharge should be the same as in letter of credit. Even if transshipment is prohibited goods shipped by containers and lash barges can be transshipped. Said to contain or shippers count wont be regarded as notation in bill of lading. Bill of lading can be signed by shipper or authorized agents in the form of physical, facsimile , engravings or rubber stamp. Bill of lading marked as original can be accepted as original.

523. What is charter party?

Charter party is an agreement for hiring the whole ship, for a particular journey or particular time period. Charter parties are not accepted by LCs.

524. What is Airway bill? When goods are airlifted airway bills are issued. There are two types of airway bilks, house or home airway bill and master airway bill, airway bill is not a document of title. 525. What is house/ home airway bill? Considering innumerable items are airlifted airlines appoint air consolidation agents who accept consignments and issue house/ home airway bill. 526. What is master airway bill? Based on consolidated home airway bill the airlines take the goods ion aircraft and issues master airway bill. 527. What are combined transport documents? Combined transport documents are issued for containerized cargo which is transported through multimodal system. 528. What is Commercial invoice? Commercial invoice is prepared as per purchase order, description of goods should correspond to purchase order, shipper should be the beneficiary and buyer should be opener. 529. What is packing list? Packing list specifies how the goods shipped are packed. Documents should not contradict each other. 530. What is certificate of origin? Certificate of origin states that in which country goods are manufactured. They can be classified as preferential and non preferential. 531. What is preferential certificate of origin? In this a developed country gives concessions to goods manufactured in developing country without any reciprocal obligation for developing country to extend the same. It is called as generalized system of preference or GSP. 532. What is non preferential certificate of origin?

It is done between two developing countries on reciprocal basis and it is known as Generalized system of trade preference (GSTP) 533. Whether document dated prior to the date of LC can be accepted? Unless there is any prohibition in the LC document dated prior to the date of LC can be accepted. 534. What is the quantity to be exported? As per UCPDC unless the exports are in terms of numbers are packages a +- 5% in quantity will be accepted if the value do not exceed the value of LC. 535. What is meant by words at, about & circa as per UCPDC? If words like at, about or circa is used as per UCPDC a variation of +- 10% in quantity is acceptable. 536. What is meant by terms beginning, middle and end of the month? Beginning means 1to 10th of the month, middle means 11th to 20 th and end means 21 st to end. 537. What is meant by first half and second half? First half means 1st to 15th while second half means sixteenth to end of the month. 538. What is a word like first class, high quality means in LC? As per UCPDC the bank can ignore terms like first class and high quality and accept document from anybody. 539. What will happen to a condition which is not backed by a document? A condition which is not backed by a document can be ignored by the bank. 540. How many days given to the bank by UCPDC to check documents? Five days are given by UCPDC to bank to check the documents. 541. Whether a cover note of insurance can be accepted as a document under LC? No either an insurance policy or insurance certificate can be accepted and not a cover note of insurance. 542. If the last date of negotiation is a holiday what will happen to negotiation? As per UCPDC if last date of negotiation is a holiday then the documents can be presented on subsequent working day, this applies only for negotiation and not for shipment. 543. What is trust receipt?

Trust receipt is one based on which bank will handover original document of title to party without payment, trust receipt should state that the party is willing to waive all discrepancies. 544. What is non preferential certificate of origin? Non preferential certificate origin which is used to verify whether the goods are manufactured in a proscribed country is rarely in use now. 545. What is FOB? FOB means free on board, that means all expenses have to be incurred by seller till the goods crosses the board of the vessel and expenses incurred after goods crossing board of vessel to be borne by the buyer. This is as per INCO terms 2000. 546. What is FAS? FAS is an American term which means free alongside ship, in which all expenses up to port of loading to be borne by seller and subsequent expenses to be borne by the buyer. 547. What is C&F? Here the price not only includes cost but also freight from origin port to destination port , in such cases LC should contain a term that the bill of lading should be endorsed freight prepaid. 548. What is CIF? Here the price not only includes ocean freight but also insurance charges from origin to destination warehouse. Unless specified insurance should be done for CIF+10%. 549. What is exquay? This means that the selling price includes clearing charges from destination port, but donot include customs duty. 550. What is exquay duty paid? Here the price not only includes clearing charges but also customs duty. 551. What is DAF? DAF is delivered at frontier and it is used for land consignments, it includes all charges for delivery at frontier but customs duty is to be paid by the buyer. 552. What is DAF duty paid? Here price includes even customs duty. 553. What is INCO Terms 2000?

INCO terms 2000 is international commercial terms framed by International Chamber of commerce headquartered in Paris, 2000 is version. 554. Who are various parties involved in LCs? Opener, opening bank, advising bank, confirming bank, negotiating bank/ nominated bank and beneficiary. 555. Who is opener? Opener is usually the buyer on whose request LC is opened. 556. What is opening bank? Opening bank is the bank of the buyer who opens the LC on the request of the opener 557. What is advising bank? Advising bank is the bank which advises about the authenticity of the LC at the request of the opening bank.

558. What is confirming bank? Confirming bank is the bank which confirms the credit of buyers bank at the request of opening bank.. Under UCPDC foreign branch of a bank is treated as separate bank, thus unless specified confirmation by the foreign branch of a bank is valid.

559. What is negotiating bank/ nominated bank? Negotiating bank is any bank which negotiates the document of seller and advances money till the same is collected from the buyer, till that period interest is charged from the beneficiary. But if opening bank restricts negotiation to particular branch it becomes nominated bank. 560. What is negotiation under reserve? Usually negotiation of document is without recourse, that means if the opening bank refuses to pay then the loss is borne by buyers bank and not the buyer, but if there are discrepancies still the beneficiary may request negotiation under reserve, if the negotiating bank agrees for the same then it will negotiate under reserve that means it has recourse to beneficiary if the opening bank refuses to pay. 561. Who is beneficiary? Beneficiary is the person who receives the proceeds of LC.

562. Name various types of LCs? Irrevocable LC, Back to back LC, Transferable LC, Confirmed LC, Red Clause LC, Green Clause LC, Revolving LC, DA LC, DP LC, Stand by LC. 563. Irrevocable LC? Irrevocable LC cannot be revoked without the consent of beneficiary. 564. What is back to back LC? In back to back LC, an intermediary can ask a buyer to open a LC in his favour and open identical sub LCS within the value of mother LC. Once the supplier supplies goods against sub LC the intermediary can substitute his document for that of the seller and successfully conceal identity of buyer from seller to earn his spread. 565. What is transferable LC? A transferable LC can be transferred in full or part in favour of one or more supplier, but the supplier cannot further transfer it. 566. What is confirmed LC? In confirmed LC at the request of opening bank its credit is confirmed by confirming bank. 567. What is red clause LC? Red clause LC are in the nature of pure advance, since it indicates danger it is written in red letter in the LC. 568. What is green clause LC? In green clause LC the goods are not shipped but deposited in warehouse at the supplier country and against Ware finger certificate endorsed in favour of buyer money is collected, this helps to avoid cash flow in the form of customs duty. 569. What is Revolving LC? Revolving LC is opened for whole year and within the same it revolves for particular amount. 570. What is DA LC? DA LC gives credit to buyer it is called as document against acceptance and it is called as usance LC. In this documents of title are released to buyer against acceptance of bill of exchange. 571. What is DP LC?

DP LC is called as document against payment LC in which documents is released against payment, it is called as sight LC. 572. What is Stand by LC? Standby LC is western equivalent of Indian Bank guarantees; unlike in the case of Indian Bank guarantees where the bank has to make payment on demand without demur against any documentary proof in US some documents by third parties regarding breach has to be produced, this is called as standby letter of credit. 573. What are different types of Bank Guarantee? Bid bond guarantee: This is given in lieu of EMD and security deposit Performance guarantee: This is given for continuing performance of equipment to release balance money. Statutory Guarantee: It is given for tax demands raised during course of appeal. Since BGs are on demand and without demur in India it is given only for top class clients as part of relationship banking. 574. What is document against collection? Document against collection are that the bank will release document only against payment or acceptance of bill of exchange, unlike in a LC the bank will not make payment if buyer refuses to make Payment. Document against payment are covered by Uniform rules for collection (URC 522) issued by ICC head quartered in Parties. 575. What is LSC? Local document against collection are called as Local short credit or LSC. 576. What are documents of title? Bill of lading, combined transport document, lorry receipt and railway receipt. 577. What is advance payment? In advance payment buyer first pay the amount then seller releases documents. 578. What is open account? In open account first buyer receives the goods then makes payments. 579. What is BRC?

BRC means Bank realization certificate, this is issued against payment for goods are service exported, now this is made electronic., 580. What is FIRC? Foreign inward remittance certificate, this is issued for advances received and are issued in stamp paper.

Carriage of goods by land sea and air act 581 Who is a public career? Public career is a person who will carry goods of any person for consideration

582. What is the liability of public career? The liability of public career is that of insurer. 583. What is the liability of private career? The liability of private career is that of bailee, that is he will be liable only for his negligence.

584. Whether domestic aircraft career is liable as public career? No , his liability will be determined as per contract under contract act.

584. Whether Railways are public career?

Yes, but they are subject to special provisions of Railway Act.

585. Whether bill of lading is document of title? Yes , without producing document of title one cant take delivery of goods, other document of title are LR, RR. 586. Name various types of bills of lading? a. Clean b. Claused c. On Board d. On Deck 587. What is Charter party? Charter party is hiring a vessel for particular journey or time period. 588. What are various types of Airway bill?

House/ Home airway bill, master airway bill. Airway bills are not documents of title.

588. What is CTD? Combined Transport Document. Consignment sent through containers travel by multimode. 589. What are the things for which a public career is not liable? Act of god, improper packing, inherent vice of goods, and fraud by consignor. 590. When public career is liable for act of God? Public career will be liable for act of god for delay, diversion from original route, unseaworthiness of vessel, his own fraud or negligence. 591. What is owners risk? A public career can restrict his liability to that of bailee through contract signed by other party where by he will be liable for negligence.

Environmental and pollution control law 593 What is the importance of environmental and pollution control laws? The only type of license to day needed to start an industry is license from pollution control board. Industries are classified as green, amber and red based on their potential to pollute and amber and red industries need environmental impact assessment as well as environmental impact statement from consultants. 594. What are the environmental acts existed prior to environmental protection act 1986? Water pollution control act 1963, air pollution control act 1981. Environment was state subject till 1976, it was included in concurrent list by 42nd amendment. The basic purpose of Environmental Protection Act 1986 is to prevent environmental pollution than correct it. 595. What is the right to appeal under Environmental protection Act? Against the order of pollution control board, appeal can be preferred to environment tribunal.

596. What is section 78 of Railways Act? Any claim against non delivery should be made within six month from RR in the name of General Manager of destination Railways. 597. How much notice should be given against Railway before filing suit? Under section 80 of CPC 2 months notice should be given to Railways before filing suit since Railway is owned by Government of India. 598. What is general average/ particular average? General Average is sacrificing cargo to save the ship, insurer is liable, for general average. 599. What is particular average? Particular average is expenses incurred for saving goods of particular person, this will be excluded peril by insurance Company. 600. What is limitation period for lodging claim?

A claim to be lodged against public career in road within six months of the event, in case of carriage of goods by sea 1 year. 601. Whether post office is a public career? Post office is not public career. FTDR( Foreign Trade Development Regulation Act? 602. When FTDR Act was enacted? FTDR Act was enacted on 1992. 603. What is EXIM Policy/ Procedure? On quarterly basis commerce ministry issues Exim policy and Director General of Foreign Trade issues EXIM Procedures. 604. What is Import Export code( IEC Code)? No importer or exporter can import or export anything without obtaining IEC Code from DGFT. 605 What is advance authorization? Unlike in the case of draw back where duty has to be paid first and taken as refund after exports, in advance authorization material required to be imported for exports can be imported without Customs.

606 What is EPCG? EPCG is export promotion capital goods under which capital goods required for export production can be imported duty free subject to export obligation.

607 What is deemed exports? Deemed exports are nothing but import substitution resulting in foreign exchange savings.

608 What is Customs warehouse? Customs warehouse are places were imported material can be stored without payment of duty. There are public and private warehouses.

609 What is EOU? EOUs are export oriented units which work under customs bond and supervision. They can get imported and local material duty free for producing for exports. 50% of material can be sold in domestic market after paying 50% Customs duty as excise. 610 What is SEZ? SEZ is a land within country which is treated as foreign territory. Any exports to SEZ is an export and sale from SEZ to India is imports. This concept which was a great success in China ended up as land grabbing exercise in India. 611. What is shipping bill? Shipping bill is a document based on which export incentives can be claimed.