LEGAL ASPECTS OF BUSINESS ASSIGNMENT

NAME – HONEY ANANT

CLASS – MBA 2

TOPIC 1. CONSUMER PROTECTION ACT 1986

The Consumer Protection Act,1986 (COPRA) was an Act by the Parliament of
India enacted to protect the interests of consumers in India. It was replaced by
the Consumer Protection Act, 2019. It was made for the establishment of
consumer councils and other authorities for the settlement of consumer's
grievances and matters connected with it. The act was passed in Assembly in
October 1986 and came into force on December 24, 1986. The statute on the
right was made before this COPRA act.

Significance of the Act

This Act is regarded as the 'Magna Carta' in the field of consumer protection for
checking unfair trade practices, ‘defects in goods’ and ‘deficiencies in services’
as far as India is concerned. It has led to the establishment of a widespread
network of consumer forums and appellate courts all over India. It has
significantly impacted how businesses approach consumers and have
empowered consumers to a greater extent.

Consumer Disputes Redressal Agencies

 District Consumer Disputes Redressal Forum (DCDRF):
Also known as the "District Forum" established by the State Government in
each district of the State. The State Governments may establish more than one
District Forum in a district. It is a district-level court that deals with cases
valuing up to ₹2 million (US$26,000).
 State Consumer Disputes Redressal Commission (SCDRC):
Also known as the "State Commission" established by the State Government in
the State. It is a state-level court that takes up cases valuing less than ₹10
million (US$130,000)
  National Consumer Disputes Redressal Commission (NCDRC):
Established by the Central Government. It deals with matters of more than 10
million.

Objectives of the central council

The objectives of the Central Council is to promote and to protect the rights of
the consumers such as:-

 The right to be protected against the marketing of goods and services

which are hazardous to life and property.
 The right to be informed about the quality, quantity, potency, purity,
standard and price of goods or services, as the case may be to protect the
consumer against unfair trade practices;
 The right to be assured, wherever possible, access to a variety of goods
and services at competitive prices ;
 The right to be heard and to be assured that consumer's interest will
receive due consideration at appropriate forums;
 The right to seek redressal against unfair trade practices or restrictive
trade practices or unscrupulous exploitation of consumers
 The right to consumer education.

Jurisdiction of District Forum

Subject to the other provisions of this Act, the District Forum shall have
jurisdiction to entertain complaints where the value of the goods or services and
the compensation, if any, claimed does not exceed rupees one crore.
A complaint shall be instituted in a District Forum within the local limits of
whose jurisdiction:-
a) – the opposite party or each of the opposite parties, where there are more than
one, at the time of the institution of the complaint, actually and voluntarily
resides or carries on business or has a branch office or personally works for
gain, or
b) – any of the opposite parties, where there are more than one, at the time of
the institution of the complaint, actually and voluntarily resides, or carries on
business or has a branch office, or personally works for gain, provided that in
such case either the permission of the District Forum is given, or the opposite
parties who do not reside, or carry on business or have a branch office, or
personally work for gain, as the case may be, acquiesce in such institution; or
c) – the cause of action, wholly or in part, arises.

Jurisdiction of State Commission

Subject to the other provisions of this Act, the State Commission shall have
jurisdiction:-

a) to entertain
i) complaints where the value of the goods or services and compensation, if any,
claimed exceeds rupees one crore but does not exceed rupees ten crore; and
ii) appeals against the orders of any District Forum within the State; and
b) to call for the records and pass appropriate orders in any consumer dispute

Jurisdiction of National Commission

(a) to entertain—
(i) complaints where the value of the goods or services and compensation, if
any, claimed exceeds rupees ten crore; and
(ii) appeals against the orders of any State mayor; and
(b) to call for the records and pass appropriate orders in any consumer dispute
which is pending before or has been decided by any State Commission.
However, the Supreme Court of India has held that the jurisdiction of National
Commission under Revision Jurisdiction is very limited and can only be
exercised when State Commission exceeds its jurisdiction, fails to exercise its
jurisdiction or there is material illegality in the order passed by State
Commission.[
TOPIC 2. The Sale of Goods Act 1930
Contracts or agreements related to the sale of goods are governed under the Sale
of Goods Act 1930. This act came into effect on the 1st of July 1930 in the
whole of India except the state of Jammu and Kashmir.
Sale of commodities constitutes one of the important types of contracts under
the law in India. India is one of the largest economies and also a great country
where and thus has adequate checks and measures to ensure the safety and
prosperity of its business and commerce community. Here we shall explain The
Sale of Goods Act, 1930 which defines and states terms related to the sale of
goods and exchange of commodities.
Contract
A Contract of Sale is:
 an offer to buy for a price, or
 An offer to sell good for a price, and
 the acceptance of such offer.
A Contract may provide for:
 the immediate delivery of the goods, or
 immediate payment of the price, or
 the immediate delivery of the goods and payment both, or
 for the delivery or payment by installments, or
 that the delivery or payment or both shall be postponed.
 per the Section 5 sub-clause (2) - Subject to the provisions of any law for
the time being in force, a contract of sale may be made-
 in writing or
 by word of mouth, or
 partly in writing and partly by word of mouth or
 may be implied from the conduct of the parties.
Sale of Goods
A contract of sale of goods is a contract whereby the seller transfers or agrees to
transfer the property in goods to the buyer for a price. There may be a contract
of sale between one part-owner and another.
Mercantile Agent
A Mercantile Agent has the customary course of business as agent authority:
 either to sell goods, or
 to consign goods for the purposes of sale, or
 to buy goods, or
 to raise money on the security of goods. section-9(2)
Buyer
A person who buys or agrees to buy goods. Price refers to money considered
for sale of goods. The price in a contract of sale may be fixed by the contract, or
may be left to be fixed in manner thereby agreed, or may be determined by the
course of dealing between the parties. Where the price is not determined in
accordance with the foregoing provisions, the buyer shall pay the seller a
reasonable price. Where there is an agreement to sell goods on the terms that-
the price is to be fixed by the valuation of a third party, and such third party
cannot or does not make such valuation, the agreement is thereby avoided,
provided the goods or any part thereof have been delivered to the buyer, and
appropriated by the buyer, the buyer shall pay a reasonable price.
In the event of a dispute, the party not in fault may maintain a suit for damages
against the party in fault.
Delivery
Means voluntary transfer of possession from one person to another.
State of Delivery
Goods are said to be in a "delivered state" when they are in such state that the
buyer would under the contract be bound to take delivery of them.
TOPIC 3. Negotiable Instruments Act, 1881
According to Section 13 of the Negotiable Instruments Act, "A negotiable
instrument means a promissory note, bill of exchange or cheque payable either
to order or to bearer. But in Section 1, it is also described that Local extent,
Saving of usage relating to hundis, etc., Commencement. -It extends to the
whole of India but nothing herein contained affects the Indian Paper Currency
Act, 1871, Section 21, or affects any local usage relating to any instrument in an
oriental language. Provided that such usages may be excluded by any words in
the body of the instrument, which indicate an intention that the legal relations of
the parties thereto shall be governed by this Act; and it shall come

Main Types of Negotiable Instruments are:

 Inland Instruments
 Foreign Instruments
 Bank
 Finance companies(listed) Draft

A negotiable instrument has the following characteristics.

1. Property
The possessor of the negotiable instrument is presumed to be the owner of the
property contained therein. A negotiable instrument does not merely give
possession of the instrument but right to property also. The property in a
negotiable instrument can be transferred without any formality. In the case of a
bearer instrument, the property passed by mere delivery to the transferee. In the
case of an order instrument, endorsement and delivery are required for the
transfer of property.
2. Title
The transferee of a negotiable instrument is known as holder in due course.’ A
bonafide transferee for value is not affected by any defect of title on the part of
the transferor or of any of the previous holders of the instrument. This is the
main distinction between a negotiable instrument and other subjects of ordinary
transfer. The general rule of nemo dat quod non habet does not apply to
negotiable instruments.
3. Rights
The transferee of the negotiable instrument can sue in his own name, in case of
dishonor. A negotiable instrument can be transferred any number of times till it
is at maturity. The holder of the instrument need not give notice of transfer to
the party liable on the instrument to pay.
4. Presumptions
Certain presumptions apply to all negotiable instruments e.g. a presumption that
consideration has been paid under it.
5. Prompt Payment
A negotiable instrument enables the holder to expect prompt payment because a
dishonor means the ruin of the credit of all persons who are parties to the
instrument.

TOPIC 4. Companies Act 1956

The Companies Act 1956 was an Act of the Parliament of India, enacted in
1956, which enabled companies to be formed by registration, and set out the
responsibilities of companies, their directors and secretaries.

The Act was administered by the Government of India through the Ministry of
Corporate Affairs and the Offices of Registrar of Companies, Official
Liquidators, Public Trustee, Company Law Board, Director of Inspection, etc.
The Registrar of Companies (ROC) handles incorporation of new companies
and the administration of running companies.

Since its commencement, it was amended many times, in which amendment of

1988, 1990, 1996, 2000, 2011 & 2013 were notable.
The basic objectives underlying the law are:
 A minimum standard of good behaviour and business honesty in
company promotion and management.
 Due recognition of the legitimate interest of shareholders and creditors
and of the duty of managements not to prejudice to jeopardize those
interests.
 Provision for greater and effective control over and voice in the
management for shareholders.
 A fair and true disclosure of the affairs of companies in their annual
published balance sheet and profit and loss accounts.
 Proper standard of accounting and auditing.
 Recognition of the rights of shareholders to receive reasonable
information and facilities for exercising an intelligent judgment with
reference to the management.
 A ceiling on the share of profits payable to managements as remuneration
for services rendered.
 A check on their transactions where there was a possibility of conflict of
duty and interest.
 A provision for investigation into the affairs of any company managed in
a manner oppressive to minority of the shareholders or prejudicial to the
interest of the company as a whole.
 Enforcement of the performance of their duties by those engaged in the
management of public companies or of private companies which are
subsidiaries of public companies by providing sanctions in the case of
breach and subjecting the latter also to the more restrictive provisions of
law applicable to public companies.

TOPIC 5. Information Technology Act, 2000

The Information Technology Act, 2000 (also known as ITA-2000, or the IT
Act) is an Act of the Indian Parliament (No 21 of 2000) notified on 17 October
2000. It is the primary law in India dealing with cybercrime and electronic
commerce.
The original Act contained 94 sections, divided into 13 chapters and 4
schedules. The laws apply to the whole of India. If a crime involves a computer
or network located in India, persons of other nationalities can also be indicted
under the law,
The Act provides a legal framework for electronic governance by giving
recognition to electronic records and digital signatures. It also defines cyber
crimes and prescribes penalties for them. The Act directed the formation of a
Controller of Certifying Authorities to regulate the issuance of digital
signatures. It also established a Cyber Appellate Tribunal to resolve disputes
rising from this new law. The Act also amended various sections of the Indian
Penal Code, 1860, the Indian Evidence Act, 1872, the Banker's Book Evidence
Act, 1891, and the Reserve Bank of India Act, 1934 to make them compliant
with new technologies.

The primary objectives of the IT Act, 2000 are:

 Granting legal recognition to all transactions done through electronic data
exchange, other means of electronic communication or e-commerce in
place of the earlier paper-based communication.
 Providing legal recognition to digital signatures for the authentication of
any information or matters requiring authentication.
 Facilitating the electronic filing of documents with different Government
departments and also agencies.
 Facilitating the electronic storage of data
 Providing legal sanction and also facilitating the electronic transfer of
funds between banks and financial institutions.
 Granting legal recognition to bankers for keeping the books of accounts
in an electronic form. Further, this is granted under the Evidence Act,
1891 and the Reserve Bank of India Act, 1934.