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Published by: Sensorica Evanescere on Sep 19, 2011
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 1.1 IntroductionObjectives1.2 Meaning and Nature of LawCharacteristics of lawLaw and moralityIgnorance of law is no excuse1.3 Sources of Indian LawPrimary sources of Indian lawSecondary sources of Indian law1.4 Legal Environment of Business1.5 Mercantile LawMeaning and natureObjectivesSources of Indian business law1.6 Some Basic Legal ConceptsConcept of legal entityConcept of legal rightsConcept of propertyIntellectual Property Rights (IPR)Concept of ownershipConcept of possession1.7 Essentials of Law1.8 Summary1.9 Terminal Questions
1.10 Answers
1.1 Introduction
 This unit, you begin by answering the question,
“What is law?” This involves the meaning
and nature of law. The classification of law, such as civil law and criminal law; substantiveand procedure law is illustrated. In this unit you also study the different sources of Indianlaw such as custom, precedents and the legislation.
 This introductory unit on law will help you get familiar with the concept of business lawand other basic legal concepts related to law. After studying this unit, you should be ableto:· Explain the nature of law· Describe sources of Indian law· Define business legal environment and mercantile law· Analyze the essentials of law
1.2 Meaning and Nature of Law
The term „law‟ is used in many senses: you may speak of the law of physics, mathematics,
science, or the laws o
f the football or health. In its widest sense, „law‟ means any rule of 
conduct, standard or pattern, to which actions are required to conform; if not conformed,
sanctions are imposed. When we speak of the law of a State, we use the term „law‟ in a
special and strict sense.
1.2.1 Characteristics of law
Law is a body of rules.
These rules prescribe the conduct, standard or pattern towhich actions of the persons in the state are required to conform. However, all rules of conduct do not become law in the strict sense. We resort to various kinds of rules to guideour lives.
For example
, our conduct may be guided by a rule such as “do not be arrogant”or “do not be disrespectful to elders or women”. These are ethical or moral rules by which
our daily lives are guided. If we do not follow them, we may lose our friends and theirrespect, but no legal action can be taken against us.2.
Law is for the guidance or conduct of persons
both human and artificial.
The lawis not made just for the sake of making it. The rules embodied in the law are made, so asto ensure that actions of the persons in the society conform to some predeterminedstandard or pattern. This is necessary so as to ensure continuance of the society. No
doubt, if citizens are „self 
enlightened‟ or
controlled‟, disputes may be minimized,
but will not be eliminated. Rules are, therefore, drawn up to ensure that members of thesociety may live and work together in an orderly manner. Therefore, if the rules embodiedin the law are broken, compulsion is used to enforce obedience, and certain consequencesensue.3.
Law is imposed.
Law is imposed on the members to bring about an order in the group,enabling it to continue and prosper. It is not something which may or may not be obeyedat the sweet will of the members of society. If you cannot impose a rule it is better not tohave it. Thus, law is made obligatory on the members of the society.
Law is enforced by the executive.
Obviously, unless a law is enforced it ceases to be alaw and those persons subject to it will regard it as dead.
For example
, if A steals B‟s
bicycle, he may be prosecuted by a court and may be punished. Also, the court may orderthe restitution of the bicycle to its rightful owner i.e., B. If the government passes manylaws but does not attempt to enforce them, the citizens lose their respect for governmentand law, and society is greatly weakened. The force used is known as sanction which thestate administers to secure obedience to its laws.5.
The state.
A state is a territorial division, with people therein subject to a uniformsystem of law administered by some authority of the state. Thus, law presupposes a state.6.
Content of law.
The law is a living thing and changes throughout the course of history.Law responds to public opinion and changes accordingly. Law can never be static.Therefore, amendments are made in different laws from time to time. For example, theMonopolistic and Restrictive Trade Practices Act, 1969, has been subjected to manyamendments since its inception in 1969.7.
Two basic ideas involved in law.
The two basic ideas involved in any law are: (i) tomaintain some form of social order in a group and (ii) to compel members of the group tobe within that order. These basic ideas underlie formulation of any rules for the membersof a group. A group is created because first, there is a social instinct in the people to livetogether and secondly, it helps them in self-preservation. Rules are made by the members
of the group, so that the group doesn‟t whith
er away.8.
Law is made to serve some purpose which may be social, economic or  political.
Some examples of „law‟ in the widest sense of the term. „Law‟ in its widest
sense may include: (i) Moral rules or etiquettes, the non-observance of which may lead topublic ridicule,(ii) Law of the Land the non-observance of which may lead to arrest, imprisonment, fines,etc., (iii) Rules of international law, thenon-observance of which may lead to social boycott, trade-sanctions, cold war, hot war,proxy war, etc.
1.2.2 Law and morality
 It was stated earlier that one of the characteristics of law is that it is for the guidance orconduct of persons. This is so in the case of morality also as there is a close relationshipbetween the two. In fact law not only has its origin in morality, but also is easier toenforce when people yield to government for moral reasons. However, a person may bemorally bound but not legally. Thus, if a young person does not show respect for anelderly person on the street, the law will take no action, although he stands condemnedby the moral judgment of people on the street. On the other hand, the law occasionallyhas to decide on a person who is not morally at fault.
For example
, X appoints Y as hisagent. Y enters into contact with Z on behalf of X. Y commits fraud in the transaction andthereby injures Z. X is bound to compensate Z. Further, there are some actions in whichboth morality and legality are involved.

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