KS Academy Main - Model (03-12-2021)

KS Academy

CA Foundation Nov 21 Main - Model Exam

Business Laws & Business Correspondence & Reporting

Roll Number ……………. Paper Code – ME2L

Time Allowed – 3 Hours Total No. of Printed Pages – 7
Total No. of Questions – 6 Maximum Marks - 100

Section - A

Question No. 1 is compulsory.

Candidates are also required to answer any four questions from the remaining five questions.

1. (a) Explain the concept of „misrepresentation‟ in matters of contract. Sohan induced Suraj to buy his
motorcycle saying that it was in a very good condition. After taking the motorcycle, Suraj complained
that there were many defects in the motorcycle. Sohan proposed to get it repaired and promised to pay
40% cost of repairs. After few days, the motorcycle did not work at all. Now Suraj wants to rescind the
contract. Decide giving reasons whether Suraj can rescind the contract?

(4 Marks)
Answer:

(b) Examine the following whether they are correct or incorrect along with reasons:

(a) A company being an artificial person cannot own property and cannot sue or be sued.
(b) A private limited company must have a minimum of two members, while a public limited company
must have at least seven members.

(4 Marks)
Answer:

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(c) Avyukt purchased 100 Kgs of wheat from Bhaskar at Rs. 30 per kg. Bhaskar says that wheat is in his
warehouse in the custody of Kishore, the warehouse keeper. Kishore confirmed Avyukt that he can take
the delivery of wheat from him and till then he is holding wheat on Avyukt‟s behalf. Before Avyukt
picks the goods from warehouse, the whole wheat in the warehouse has flowed in flood. Now Avyukt
wants his price on the contention that no delivery has been done by seller. Whether Avyukt is right with
his views under the Sale of Goods Act, 1930.

(4 Marks)
Answer:

2.(a) “Only a person who is party to a contract can sue on it”. Explain this statement and describe its
exceptions, if any.

(7 Marks)
Answer:

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(b) What do you mean by Designated Partner? Whether it is mandatory to appoint Designated partner
in a LLP?

(5 Marks)
Answer:

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3.(a) When does dissolution of a partnership firm take place under the provisions of the Indian
Partnership Act, 1932? Explain.
(6 Marks)
Answer:

(b) In light of provisions of the Indian Contract Act, 1872 answer the following:
(i) Mr. S and Mr. R made contract wherein Mr. S agreed to deliver paper cup manufacture machine to
Mr. R and to receive payment on delivery. On the delivery date, Mr. R didn't pay the agreed price.
Decide whether Mr. S is bound to fulfil his promise at the time of delivery?

(ii) Mr. Y gave loan to Mr. G of ₹ 30,00,000. Mr. G defaulted the loan on due date and debt became time
barred. After the time barred debt, Mr. G agreed to settle the full amount to Mr. Y. Whether acceptance
of time barred debt Contract is enforceable in law?

(iii) A & B entered into a contract to supply unique item, alternate of which is not available in the
market. A refused to supply the agreed unique item to B. What directions could be given by the court for
breach of such contract?

(6 Marks)
Answer:

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4.(a) Ms. R owns a two Wheeler which she handed over to her friend Ms. K on sale or return basis. Even
after a week, Ms. K neither returned the vehicle nor made payment for it. She instead pledged the
vehicle to Mr. A to obtain a loan. Ms. R now wants to claim the two Wheeler from Mr. A. Will she
succeed?

(i) Examine with reference to the provisions of the Sale of Goods Act, 1930, what recourse is
available to Ms. R?
(ii) Would your answer be different if it had been expressly provided that the vehicle would
remain the property of Ms. R until the price has been paid?

(6 Marks)
Answer:

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(b) Master X was introduced to the benefits of partnership of M/s ABC & Co. with the consent of all
partners. After attaining majority, more than six months elapsed and he failed to give a public notice as
to whether he elected to become or not to become a partner in the firm. Later on, Mr. L, a supplier of
material to M/s ABC & Co., filed a suit against M/s ABC & Co. for recovery of the debt due.

In the light of the Indian Partnership Act, 1932, explain:

(i) To what extent X will be liable if he failed to give public notice after attaining majority?
(ii) Can Mr. L recover his debt from X?

(6 Marks)
Answer:

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5.(a) Mr. Das, a general store owner went to purchase 200 kg of Basmati Rice of specific length from a
whole seller. He saw the samples of rice and agreed to buy the one for which the price was quoted as `
150 per kg. While examining the sample Mr. Das failed to notice that the rice contained a mix of long and
short grain of rice.

The whole seller supplied the required quantity exactly the same as shown in the sample. However,
when Mr. Das sold the rice to one of his regular customers she complained that the rice contained two
different qualities of rice and returned the rice.

With reference to the provisions of the Sales of Goods Act, 1930, discuss the options open to Mr. Das for
grievance redressal. What would be your answer in case Mr. Das specified his exact requirement as to
length of rice?

(6 Marks)
Answer:

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(b) Explain clearly the doctrine of „Indoor Management‟ as applicable in cases of companies registered
under the Companies Act, 2013. Explain the circumstances in which an outsider dealing with the
company cannot claim any relief on the ground of „Indoor Management‟.

(6 Marks)

Answer:

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6.(a) “Partner indeed virtually embraces the character of both a principal and an agent”. Describe the
said statement keeping in view of the provisions of the Indian Partnership Act, 1932.

(6 Marks)
Answer:

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(b) “The Memorandum of Association is a charter of a company”. Discuss. Also explain in brief the
contents of Memorandum of Association.

(6 Marks)
Answer:

Section – B
Question No: 7 is compulsory.
Answer any three questions out of the remaining four questions

7.(a) Read the passage carefully and answer the questions that follow:

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Raising funds for elections has been a unique feature of Indian politics from the very beginning and it
will not be wrong to say that it is one of the most dominant motive forces behind political corruption. A
strange hawala scandal came to light in January 1996, which was then the chief vehicle exclusively for
politicians to raise election funds for their parties and themselves via illegal foreign exchange
transactions. This raised huge public attention on both corruption and its linkage with our great
democratic festival of elections. The explosion of the corrupt fund-raising incidents in connection with
arms deals by Tehelka.com in March 2001 was the next mind-blowing eye-opener for all. The notorious
incidents highlighted the requirement for reform of party and election finance, including the possible
option of state funding of elections. To have a clear blotless democracy the need of Political finance
reform is a must as elections are the foundation. What will happen to our great building of democratic
India if its foundation stones have been sunk in the waters of corruption before using?

There are a lot of working systems managing political, including election, finance around the world. The
funds are needed for various operations of Political parties: election campaigns, inter-election
maintenance of their organizations and political activities, and support of research and information
infrastructure for the parties. Election campaigns are always the primary visible activity requiring funds.
Unfortunately, this has made political parties (of the right and centre) unduly dependent on big business
houses and wealthy individuals. On the other hand Parties of the left became dependent on the
collective contributions of workers, often channelled through affiliated trade unions. Such interests,
typically, seek rents as a quid pro quo for political donations.

We have to get to the roots of the problem to bring election finance reform. We need to have a focused
spotlight and restructuring management related to the election campaign costs, laws to maintain
transparency in the election-related fundraising and checks for correction scandals. It was widely felt
worldwide that a free-for-all system of election fundraising gave excessive power to the rich business
organizations and individuals, not only over left-of-centre parties but even pro-business parties and
politicians.

If we study the fundamentals of political finance reform in democracies worldwide, we would have
certain characteristics conspicuous to us: limits on expenditure including sub - limits on particular
expenditure; limits on contributions from individuals and organizations; public funding, full or partial,
of elections and/or parties; and reporting and disclosure of election, party and candidate finances in
some form as an administrative pre-requisite for implementation of any or all of the above.

It is a fact that some democracies have more frequently applied limits on expenditures than limits on
contributions to parties/candidates. The point that they missed is that their limitation laws applied only
to election campaigns, usually limited to the format period of the campaigns, rather than to general
party expenditures. They aimed to reduce costs for all contestants, thus indirectly addressing the issue of
equality of political opportunity. Usually, the limits apply to the amounts that candidates and/or parties
may spend on election campaigns. Within these overall maxima, there are often limits on the amounts
that may be spent on particular items, for example, broadcasting, advertising, wall posters and
billboards.

1. According to the passage what is/are the reason(s) for warranting a discussion on political finance
reform?

1. Increasing costs attached to political campaigns.

2. The polity‟s concern for equal opportunity for political participation.
3. Instances of corruption.

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4. Political parties‟ excessive dependence on big business and wealthy individuals.

a. 2 and 4
b. 1, 2 and 3
c. 1 and 3
d. 2, 4 and 3
2. What according to the passage is the difference between parties of the left and right in the dependence
on funds for election campaign?

a. Political parties of the left depend on the collective wealth of the unions whereas those of the right
depend on big business and wealthy individuals
b. Political parties of the right depend on large business organizations and affluent individuals whereas
those of the left depend on the collective contribution of workers.
c. Political parties of the right depend on large MNCs and corporate houses whereas those of the left
depend on contributions from the common man.
d. Political parties of the right depend on their networks of influential individuals whereas those of the
left depend on contributions from the trade unions.

3. Political funds are used for which of the following purpose(s)?

1. To influence the electorate.

2. To ensure inter-election maintenance of the political organization and political activities.
3. To allow for sustenance of research infrastructure for the political parties.
4. To introduce an understanding of political issues amongst the electorate.

a. Both 1 and 4
b. Only 2, 3 and 4
c. Both 3 and 4
d. Both 2 and 3

4. What is the primary purpose of the passage?

a. Discuss the need for reform of political finance.

b. Discuss the methodology to ensure political finance reform.
c. Discuss the ways and means to bring about stability of democracy.
d. Discuss the need for reducing widespread cynicism about parties and politicians.

5. According to the passage, democracies worldwide focus on which main characteristics of political
finance reform?

(5 Marks)
(b) Read the Passage :

(i) Make Notes, using Headings, Subheadings and abbreviations whenever necessary. (3 Marks)
(ii) Write Summary (2 Marks)

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Recycling is simply the process of reusing the items from which utility can still be derived. It is
important to recycle waste so that we can at least conserve some. of our natural resources for the
generations to come. Many products such as paper, cardboards, and cups come from trees. In fact trees
are our natural assets; you can conserve trees by recycling the paper products as by doing so we can
minimize the number of trees cut down a year. This is one form of waste recycling.

Recycling waste will not only save our natural resources but will also help save energy. By simply
recycling an item or making a basic fix to it, we can save all the energy that would have been consumed
in the process of making it. The same example can be taken with plastic items. A large amount of energy
can be saved by simply reusing the plastic items. To recycle waste is to simply reduce pollution. By
recycling plastic material, we can reduce air pollution as well as water pollution. Plastic factories
produce a large amount of smoke while producing plastic material at the same time; if we don't have a
proper waste disposal system then those waste emissions will cause water pollution. Recycling helps
reduce pollution too.

In simple words, recycling waste is essential for both the natural environment and humans. To sum up,
recycling minimizes the need for raw materials so that the rainforests can be preserved. Great amounts
of energy are used when making products from raw materials. Recycling requires much less energy and
therefore helps to preserve natural resources. One needs to know the importance of recycling; at the
same time being earth friendly can help make our planet a better place to live in.

Answer:

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8.(a) What is the difference between chain network and wheel spoke network?

(2 Marks)
(b) (i) Choose the word which best expresses the meaning of the given word.
Clamour
a. Assuage
b. Affirm
c. Silence
d. Tumult

(1 Mark)

(ii) Select a suitable antonym for the word given in question.

Cobble

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a. Indifferent
b. Synthesize
c. Complete
d. Destroy

(1 Mark)

(iii) Change the following sentences into passive voice.

I was watering the plants.

(1 Mark)
Answer:

(c) Write a précis and give appropriate title to the passage given below.

Liberalism is founded on the belief in human liberty. Unlike rats and monkeys, human beings are
supposed to have “free will”. This is what makes human choices the ultimate moral and political
authority in the world.

If you happened to be amid the riots in Washington on the day after Martin Luther King was
assassinated, or in Paris in May 1968, or at the Democratic party‟s convention in Chicago in August 1968,
you might well have thought that the end was near. While Washington, Paris and Chicago were
descending into chaos, the Soviet system seemed destined to endure forever. Yet 20 years later it was the
Soviet system that collapsed. The clashes of the 1960s strengthened liberal democracy, while the stifling
climate in the Soviet bloc presaged its demise.

(5 Marks)
Answer:

9.(a) Mention the networks used in communication. Which is the most effective for team work and why?
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(2 Marks)
Answer:

(b) (i) Change the sentence from Active to Passive Voice.

The crew cleaned the entire stretch of highway.

(1 Mark)

(ii) Change the sentence from Passive to Active Voice.

The house was remodelled by the homeowners to help it sell.

(1 Mark)
(iii) Change the following sentence to indirect speech.
Socrates said, "Virtue is its own reward."

(1 Mark)
Answer:

(c) Write a report on „Indian unicorn start-ups IPO launch‟ in 250-300 words

(5 Marks)
Answer:

10.(a) Define circuit and star network under network in communication.

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(2 Marks)
Answer:

(b)(i) Rewrite the following sentences in passive voice.

I ran the obstacle course in record time.

(1 Mark)
(ii) Rewrite the following sentences in the active voice.
He will be given a ticket for over speeding by the police officer.

(1 Mark)
(iii) Change the following sentences to indirect speech.
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The policeman said to the stranger, “Who are you?”

(1 Mark)
Answer:

(c) Write an article in 250-300 words on the following topics:

„Environmental Pollution – A Global Problem‟

(5 Marks)
Answer:

11.(a) How non-verbal communication is impactful in communication?

(2 Marks)
Answer:

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(b) Select the correct meaning of idioms / phrases given below:

(i) Storm in tea cup
(1) Crave for something
(2) Drink tea often
(3) Get into quarrel
(4) Making a big issue out of a small thing.

(1 Mark)

(ii) To grease the palm

(1) Treat suffer
(2) To offer bribe
(3) To swim in deep sea
(4) To be in deep thought.

(1 Mark)

(iii) Rewrite the following sentences in the active voice:

The entire district was destroyed by cyclone.

(1 Mark)

(c) You bought a printer a few days back from a leading chain of electronic stores. Now you found a few
defects in its working. Write a letter to the dealer complaining about the problem and requesting him to
rectify the problem or replace the printer.

(5 Marks)

Answer:

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