BUSINESS & COMMERCIAL LAW

Time allowed- 2 hours

Total Marks- 100

[N.B. – The figures in the margin indicate full marks. Questions must be answered in English. Examiner
will take account of the quality of language and of the way in which the answers are presented.
Different parts, if any, of the same question must be answered in one place in order of sequence.]

Marks
1. a. What do you understand by the doctrine of Privity of Contract? Distinguish between
contract and agreement. 2+7=9
b. Describe the situations when an agreement becomes enforceable. 4

2. a. Describe the circumstances when a proposal is revoked. 7

b. Sunnehra had applied in January 2013 for shares in Business Icon Ltd and had paid a deposit
into the Company‟s bank. She heard nothing more until the end of December 2014, when she
was informed that shares had been allotted to her and that she should pay the balance upon
them.
Do you think she can refuse to take the shares in Business Icon Ltd? Explain. 3

3. a) The contract made by an agent is binding on the principal and the other party only if the agent
was acting within the limits of his authority from his principal. Identify and briefly explain
three distinct sources of authority an agent can be given by the principal. 6
b) Sartajworks inNasrin‟s building firm. He is employed in the purchase department. Nasrin
does not have approved suppliers, but Sartaj is required by internal policy to get
Nasrin‟sapproval for all orders. Nasrin has been invited to Mahboob‟s timber yard as
Mahboob is keen to get Nasrin as a customer. However, Nasrinis busy and doesn‟t want to
go, so she sends Sartaj in her place, telling Mahboob that „he deals with buying anyway‟.
While Sartaj was at Mahboob‟s timber yard, he noticed a very good price on some timber.
Knowing that Nasrin needed some timber soon for an existing project, he decided to buy it
for Nasrin. Mahboob was delighted, and set up a credit account for the timber in Nasrin‟s
name.
Indicate whether Sartaj has any authority to make this contract on Nasrin‟s behalf. If yes,
what types of authority Sartaj has? 4

4. Write short notes on:

a) Implied terms of contract b) Caveat Emptor Rule c) Promissory Notes. 3x3=9

5. Describe the general rules as to delivery of goods in accordance with The Sale of Goods Act,
1930. 10

6. Describe the rules which are applicable in the case of lost negotiable instruments. 10

7. What are the differences between Partnership and Co-ownership? 10

8. Can a minor be a partner in a firm? State his rights and liabilities on attaining majority if he (a)
elects to become a partner and (b) does not elect to become a partner. 10

9. What do you understand by “Protected Transactions” in case of bankruptcy? 8

10. What is arbitration agreement? Describe the general responsibilities of the arbitral tribunal? 10

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