Scheme of Evaluation

II Internals – Business Regulations

Sec A
1. Define Consumer
Sec 2 (7)

"consumer" means any person who—

(i) buys any goods for a consideration which has been paid or promised
or partly paid and partly promised, or under any system of deferred payment
and includes any user of such goods other than the person who buys such
goods for consideration paid or promised or partly paid or partly promised, or
under any system of deferred payment, when such use is made with the
approval
of such person, but does not include a person who obtains such goods for
resale or for any commercial purpose; or

(ii) hires or avails of any service for a consideration which has been paid
or promised or partly paid and partly promised, or under any system of
deferred
payment and includes any beneficiary of such service other than the person
who hires or avails of the services for consideration paid or promised, or partly
paid and partly promised, or under any system of deferred payment, when such
services are availed of with the approval of the first mentioned person, but
does
not include a person who avails of such service for any commercial purpose.

2. Define Consumer Dispute

Sec 2 (8) "consumer dispute" means a dispute where the person against whom
a complaint has been made, denies or disputes the allegations contained in the
complaint;

3. Who is a Minor?
According to section 11 of ICA, a minor is an incompetent person to enter into
a contract.
Definition:
Section 3 of Indian Majority Act 1875, defines a minor as “A minor is one
who has not
completed the age of his or her 18th year”.
4. What is Fraud?
Definition: According to Sec 17 of ICA 1872,
a. A false suggestion as to a fact knows known to be false or not believe to be
true.
b. The active concealment of a fact.
 c. A promise made without any intention of performing it
d. Doing any such act or making any such omission as the law specifically
declares to be
fraudulent
e. Doing any other act fitted to deceive.

5. What is price as per sale of goods act?

6. State the differences between Coercion and Under Influence

1. Coercion
Meaning: it means a threat or force used by one party against another for
compelling him
to enter into an agreement.
Definition: According Sec 15 of ICA 1872, “Committing or threatening to
commit any act
forbidden by the Indian Penal Court (IPC) or the unlawful detaining or
threatening to detain
by property to the prejudice of any person, with the intension of causing any
person to
enter into an agreement” is called coercion.
Essentials that amounts to coercion:
a. Committing any act forbidden by IPC
b. Threatening to commit any act forbidden by the IPC
c. Unlawful retaining of property of another
d. Threatening to detain the property unlawfully.
2. Undue Influence:
Meaning: it is the domination of one person who is having strong mind will over another
who is having weak mind and weak will.
Definition: Sec 16 of ICA 1872, “A contract is said to be influenced by undue influence,
where the relations subsisting between the parties are such that one of the parties is in a
position to dominate the will of other and uses the position, to obtain an unfair advantage
over the other”.
Essentials elements of undue influence:
1. Existence of apparent authority
2. Existence of by fiduciary relationship
3. Existence of mental in capacity
4. Existence of unconscionable bargains
5. Contracts with pardanashin ladies
6. Burden of proof.
7. Effect of undue influence

What is contract of sale? State differences between sale and Agreement to sell
What are the rights of the consumer as per COPRA 2019?
Sec 2 (9)

"consumer rights" includes,—

(i) the right to be protected against the marketing of goods, products or

services which are hazardous to life and property;

(ii) the right to be informed about the quality, quantity, potency, purity,
standard and price of goods, products or services, as the case may be, so as to
protect the consumer against unfair trade practices;
(iii) the right to be assured, wherever possible, access to a variety of
goods, products or services at competitive prices;

(iv) the right to be heard and to be assured that consumer's interests will
receive due consideration at appropriate fora;
(v) the right to seek redressal against unfair trade practice or restrictive
trade practices or unscrupulous exploitation of consumers; and

(vi) the right to consumer awareness;

Explain various implied conditions and warranties

Implied Conditions and Warrenties:
Implied conditions and warrenties are those which are implied by law in every contract of
sale of goods unless a contrary intention appears from the terms of the contract.
1.Conditions as to title section 14 (a):
It is an important implied condition in every contract of sale.It is presumed that the seller has
a valid titled to the goods.
Example: A bought a secondhand car from B a car dealer. After a few months the car was
taken by the police as it was stolen one . and A was forced to return the car to the true owner.
It was held that A could recover the full price from B. in this case there was a breach of
condition as to title as B has no right to sell the car.
2.Condition incase of sale by description section 15:
In a sale by description there is an implied condition that the goods shall correspond with the
description and if the sale is by sample as well as by description the goods must not only
correspond with the sample but also with description.
Example: A at Calcutta sells to B twelve bags of waste silk on its way from murshidabad to
Calcutta. There is an implied condition that the silk shall be such as is known in the market as
waste silk if it not, B is entitled to reject the goods.
3.Condition in case of sale by sample section 17:
A contract of sale is a contract for sale by sample where there is a term in the contract express
or implied to that effect.incase of contract for sale by sample there is an implied condition
that . 1.The Bulk shall correspond with the sample as regards quality.
2. Buyer can compare the bulk with sample.
Example:
X bought from Y certain quantity of worsted coating equal to sample. The coating was equal
to sample but due to a latent defect. The cloth was found to be unfit for making coats. The
buyer has entitled to reject the goods because the defect contained in the sample was not
apparent on reasonable examination of the sample.
4.Condition incase of sale by description and sample sec 15
Where the goods are sold by sample as well as by description, the implied condition is that
the bulk of the goods supplied must correspond with both the sample as well as description.
Example: A agreed to sell to B. some cotton which was described as Long staple cotton the
sample was also shown to B. A delivered the cotton which was of the quality of sample. But
B found that the cotton was not Long staple but only western madras cotton. It was held by
the buyer could reject the goods.
5.Condition as to quality or fitness sec 16(1)
Ordinarily there is no implied conditions as to the quality or fitness for any particular purpose
of goods supplied to the buyer under a contract sale. In other words. The buyer must satisfy
himself about the quality as well as the suitability of the goods.
Example: A bought a set of false teeth from B a dentist. But the set was not fit for A ‘s
mouth.A rejected the set of teeth and claimed the refund of Price.It was held that A was
entitled to do so as the only purpose for which he wanted the set of teeth was not fulfilled.
6.Condition as to merchantable quality sec 16 (2)
The expression merchantable quality means that the quality and condition of goods must be
such that a man of ordinary prudence would accept them as the goods of that description.
Goods may be free from any latent or hidden defects.
Example: Where the gloves supplied contained certain chemicals which could cause skin
disease to a person wearing them next to skin. It was held that because of such a defect the
gloves were not merchantable quality and the buyer was entitled to reject the goods.
7.Condition as to wholesomeness:
Incase the case of eatables and provisions in addition to the implied condition that the goods
shall be wholesome. Condition as to wholesomeness means that shall be fit for human
consumption.
Example: X bought a Milk from Y’s Dairy. The milk contained typhoid terms. X’s wife
consumed milk became infected and died. Y was liable for damages because the milk was not
fit for human consumption.
8.Condition implied by custom sec16(3)
According tosection 16 (3)”an implied condition as to quality or fitness for a particular
purpose may also be as to usage of trade or according to the customs”.
Example:
X sold certain drugs by action to Y. incase of sale by auction there was trade custom to
declare any sea damage in the goods. But the goods were sold without such declaration.
Such goods were found to be sea damaged. It was held Y could reject the goods and claim the
refund of the price because the sale without such declaration meant that the goods were free
from any sea damage.
Implied warrenties:
1.warrenty as to possession sec 14(b)
In every contract of sale unless there is a contrary intention. There is an implied warranty that
the buyer’s shall have and enjoy quiet possession of the goods.
Example: Ram sold a second hand scooter to shyam spent RS100 on the repairs of this
scooter. The scooter was seized by the police as it was stolen one. Shyam filled case against
Ram for the recovery of damages for breach of warrenty of quite possession including the
cost of repairs.
2.Warrenty of freedom from encumbrances sec14( C)
The buyer is entitled to a further warrenty that the goods shall be free from any charge or
encumbrance infavour of any third party not declared or known to buyer before or at that time
when the contract is made.
Example: Ram takes Loan from shyam and hypothecated his scooter with shyam as
security.Later on Ram sold this scooter to Arun who bought in good faith. Here Arun can
claim damages from Ram because his possession is distributed by shyam having a charge.
3.Warrenty as to quality or fitness for a particular purpose annexed by usage of trade
sec 16(3)
An implied warrenty as to quality or fitness for a particular purpose may be annexed by the
usage of trade.

Explain the jurisdiction and composition of National State and District commission
Who is an unpaid seller? Explain the rights of an unpaid seller.
Unpaid seller
When the seller of goods did not receive its whole price or receives part payment of its price
then he is called an unpaid seller.
Definition:
A seller or his agent is called as unpaid seller when
a) The full price has not been paid
b) A bill of exchange or any other negotiable instrument has been given as a conditional
payment but it has been dishonoured.
The rights of unpaid seller are briefly explained below:
I. Right of unpaid against the goods.(when the property in goods has passed to the buyer)
1) Right of lien: Sec.47 to 49 . Lien is aright to retain the possession of gods until the price is
paid, If the goods are partly delivered he can use this right on the remaining goods except
when the part delivery made is to indicate that he has given up this right.(Sec.48)
This right he can use on the whole of goods in his possession and only for the recovery of the
price of the goods sold but not for the recovery of warehouse charges or godown rent.
The right he can use only:
a) When the unpaid seller has the possession of goods
b) When the goods have been sold on credit.
c) When the credit period is over and the price is not paid.
d) When the buyer becomes insolvent. Sec.47(1).
Sec.49: This lien right is lost or he cannot use the right.
a) When the unpaid seller delivers the goods to a carrier or other bailee for the
purposes of taking them to the buyer.(but without reserving the right of disposal)
b) When the buyer or his agent lawfully gets the possession of the goods.
c) When the unpaid seller has given up his right of lien.
2)Right of stoppage of goods in transit: Sec.50 to 52. This is the right of the unpaid seller to
stop the goods when they are in transit. (i.e.in journey).
When the seller has parted with the possession of goods, he may regain such
possession by stopping the goods in transit before it is delivered to the
buyer.(Sec.50)
This right is available:
a) When the goods are in transit and
b) When the buyer becomes insolvent.

3) Right of resale(Sec.54) The unpaid seller can re sell the goods:

a) When the goods are perishable (without notice to buyer)
b) When the goods are not perishable with notice to the buyer of his intention to re sell and
Effect of notice of resale to the buyer.
i) When the unpaid seller makes any profit on resale, he can retain the profit of such resale, if
he has given the notice of resale.
ii) He can claim damages for breach of contract from the original buyer for any loss on the re
sale price)
If he does not give such notice of re sale, to the buyer, he must pay back the
surplus(profit) to the original buyer, and shall himself bear the loss.
(When the property in goods has not passed)
Right of with holding the delivery Sec.46(2)
The unpaid seller can withhold the delivery of goods when the peoperty in goods has not
passed to the buyer.