CA Foundation Question Paper with Solution Dec 2023 - LAW
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T owes G. the following debts as per the table given below.
| Amount of the Debt (in ₹) | Position of Debt |
| 5,000 | Time barred on 01st July, 2023 as per the provisions of the Limitation Act, 1963 |
| 3,000 | Time barred on 01st July, 2023 as per the provisions of the Limitation Act, 1963 |
| 12,500 | Due on 1st April, 2022 |
| 10,000 | Due on 15st July, 2023 |
| 7,500 | Due on 25th November, 2023 |
G makes payment on 1 April, 2023 mentioned as below without any notice regarding how to appropriate the amount/payment.
(i) A cheque of ₹ 12,500
(ii) A cheque of ₹ 4,000.
In such a situation how the appropriation of the payment is done against the debts as per the provisions of the Indian Contract Act, 1872 by assuming that T also has not appropriated the amount received towards any particular debt.
Answer :
If the performance consists of payment of money and there are several debts to be paid, the payment shall be appropriated as per provisions of Sections 59, 60 and 61.
The debtor has, at the time of payment, the right of appropriating the payment. In default of debtor, the creditor has option of election and in default of either the law will allow appropriation of debts in order of time.
In the present case, G had made two payments by way of two cheques. One cheque was exactly the amount which is due on 01st April 2022. It would be understood even though not specifically appropriated by Mr. T, it will be against such exact amount. Hence, cheque of ₹ 12,500 will be appropriated against the amount which of ₹ 12,500 which was due on 01st April 2022.
Cheque of ₹ 4,000 can be appropriated against any lawful debt which is due even though the same is time-barred.
Hence, Mr. G can appropriate the same against the debt of ₹ 5,000 which was due on 01st July, 2023.
The State Government of X, a state in the country is holding 48 lakh shares of Y Limited. The paid-up capital of Y Limited is ₹ 9.5 crore (95 lakh shares of ₹ 10 each). Y Limited directly holds 2,50,600 shares of Z Private Limited which is having share capital of ₹ 5 crore in the form of 5 lakh shares of ₹ 100 each. Z-Private Limited claimed the status of a subsidiary company of Y Limited as well as a Government company. Advise as a legal advisor, whether Z Private Limited is a subsidiary company of Y Limited as well as a Government company under the provisions of the Companies Act, 2013? The Companies Act. 2013?
Answer :
Discuss the various types of implied warranties as per the Sale of Goods Act, 1930.
Answer :
Various types of implied warranties:
1. Warranty of quiet possession [Section 14(b)]:
In a contract of sale, unless there is a contrary intention, there is an implied warranty that the buyer shall have and enjoy quiet possession of the goods. If the buyer is in any way disturbed in the enjoyment of the goods in consequence of the seller’s defective title to sell, he can claim damages from the seller.
2. Warranty of freedom from encumbrances [Section 14(c)]:
The buyer is entitled to a further warranty that the goods are not subject to any charge or encumbrance in favour of a third party. If his possession is in any way disturbed by reason of the existence of any charge or encumbrances on the goods in favour of any third party, he shall have a right to claim damages for breach of this warranty.
3. Warranty as to quality or fitness by usage of trade [Section 16(3)]:
An implied warranty as to quality or fitness for a particular purpose may be annexed by the usage of trade.
4. Warranty to disclose dangerous nature of goods:
Where a person sells goods, knowing that the goods are inherently dangerous, or they are likely to be dangerous to the buyer and that the buyer is ignorant of the danger, he must warn the buyer of the probable danger, otherwise he will be liable for damages.
Explain the terms "Trafficking relating to public offices and titles" and “Stifling prosecution” as per the Indian Contract Act, 1872.
Answer :
Trafficking relating to public offices and titles
An agreement to trafficking in public office is opposed to public policy, as it interferes with the appointment of a person best qualified for the service of the public.
Public policy requires that there should be no money consideration for the appointment to an office in which the public is interested. The following are the examples of agreements that are void; since they are tantamount to sale of public offices.
(1) An agreement to pay money to a public servant in order to induce him to retire from his office so that another person may secure the appointment is void.
(2) An agreement to procure a public recognition like Padma Vibhushan for reward is void.
Example - Harish paid ₹ 15000 to the officer to give his son the job in the Forest department of India. On failure by officer he couldn’t recover the amount as such contract amounts to trafficking in public office which is opposed to public policy.
An agreement to stifle prosecution i.e. “an agreement to present proceedings already instituted from running their normal course using force” tends to be a perversion or an abuse of justice; therefore, such an agreement is void.
The principle is that one should not make a trade of felony. The compromise of any public offence is generally illegal.
Under the Indian Criminal Procedure Code, there is, however, a statutory list of compoundable offences and an agreement to drop proceeding relating to such offences with or without the permission of the Court, as the case may be, in consideration the accused promising to do something for the complainant, is not opposed to public policy.
Thus, where A agrees to sell certain land to B in consideration of B abstaining from taking criminal proceeding against A with respect to an offence which is compoundable, the agreement is not opposed to public policy. But, it is otherwise, if the offence is uncompoundable.
Explain the provisions relating to the registration of changes in partners under the Limited Liability Partnership Act, 2008.
Answer :
Discuss the rule regarding a partner's implied authority to bind the firm for his acts. Also, explain the situations when the partner has no implied authority to bind the firm.
Answer :
(i) A mobile phone was displayed in a shop with a price tag of ₹ 10,000 attached to the mobile display box. As the price displayed was very less as compared to M.R.P. of the mobile phone, Y, a customer rushed to the cash counter and asked the shopkeeper to receive the payment and pack up the mobile phone. The shopkeeper refused to hand over the mobile phone to Y in consideration of the price indicated in the price tag attached to the mobile phone. Y seeks your advice whether he can sue the shopkeeper for the above cause under the Indian Contract Act, 1872.
Answer :
The offer should be distinguished from an invitation to offer. An offer is definite and capable of converting an intention into a contract. Whereas an invitation to an offer is only a circulation of an offer, it is an attempt to induce offers and precedes a definite offer.
Where a party, without expressing his final willingness, proposes certain terms on which he is willing to negotiate, he does not make an offer, but invites only the other party to make an offer on those terms. This is the basic distinction between offer and invitation to offer.
The display of articles with a price in it in a shop is merely an invitation to offer. It is in no sense an offer for sale, the acceptance of which constitutes a contract. In this case, Mr. Y a customer, rushed to the shopkeeper for payment simply made an offer to buy the mobile phone selected by him. If the shopkeeper does not accept the price, the interested buyer cannot compel him to sell.
Thus, Y cannot sue the shopkeeper for the above cause.
(ii) On 1st March 2023, T Readymade Dress Garments, Shimla enters into a contract with J. Readymade Garments, Jaipur for the supply of different sizes of shirts 'S' (Small), 'M' (Medium), and 'L' (Large). As per the terms of the contract, 300 pieces of each category i.e. 'S' @ 900; 'M' @ 1,000 and 'L' @ 1,100 per piece have to be supplied on or before 31st May, 2023.
However, on 1st May, 2023, T Readymade Dress Garments, Shimla informed J Readymade Garments, Jaipur that the firm is not willing to supply the shirts at the above rate due to the rise of prices in the raw material cost. In the meantime, prices for similar shirts have gone up in the market to the tune of ₹ 1,000; ₹ 1,100; and ₹ 1,200 for 'S’, 'M' and 'L' sizes respectively.
Examine the rights of J Readymade Garments, Jaipur in this regard as per the provisions of the Indian Contract Act, of 1872.
Answer :
Can an unpaid seller who has possession of goods exercise the Right of lien? If yes, mention such circumstances. When does he lose his right of lien as per the provisions of the Sale of Goods Act, of 1930?
Answer :
State giving reasons whether the following are partnerships as per the provisions under the Indian Partnership Act, 1932:
(i) X, Y, and Z agree to divide the profits equally, but the loss, if any, is to be borne by X alone. Is it a case of partnership?
(ii) X, a publisher, agrees to publish a book at his own expense written by Y and to pay Y, half of the net profit. Does this create a relationship of pårtnership between X and Y? Is Y liable to a paper- dealer for paper supplied to X to print Y's book?
(iii) A and B purchase a tea shop and incur additional expenses for purchasing utensils etc. each contributing half of the total expense. The shop is leased out on daily rent which is divided between both. Does this arrangement constitute a partnership between A and B?
Answer :
(i) X, a furniture dealer, delivered furniture to Y under an agreement of sale, whereby Y had to pay the price of the furniture in three instalments. As per the terms of the agreement, the furniture will become the property of Y on payment of the last instalment. Before Y had paid the last instalment, he sold the furniture to Z, who purchased it in good faith. X brought a suit against Z for the recovery of the furniture on the ground that Z had no title to it. Decide the case on the basis of the provisions as per the Sale of Goods Act, 1930.
Answer :
Where a buyer with the consent of the seller obtains possession of the goods before the property in them has passed to him, he may sell, pledge or otherwise dispose of the goods to a third person, and if such person obtains delivery of the goods in good faith and without notice of the lien or other right of the original seller in respect of the goods, he would get a good title to them [Section 30(2)].
Here, X (the furniture dealer) entered into an agreement of sale with Y, where Y was to pay for the furniture in three instalments, and the furniture would become Y's property upon payment of the last instalment. The above scenarios is very much covered in the provisions of Section 30(2).
In this case, Z has acted in good faith and bought the furniture from Y who was in possession of the furniture; did not pay the last installment to X. X cannot file a suit against Z. He can only take proceedings against Y.
(ii) Against B's tender, R agrees to sell and deliver 1,000 kg tomatoes @ ₹ 100 per kg which shall be delivered on 15th July, 2023. Due to the rise of the prices of tomatoes in the market, R delivered only 700 kg of tomatoes on 15th July, 2023 and agrees to deliver the balance quantity in the next month. B accepted 700 kg of tomatoes sent by R. Later, R failed to deliver the balance quantity and so B refused to pay the price of 700 kg of tomatoes to R as he had failed to fulfill the tender conditions stipulated in the contract of sale.
Can B refuse to pay R as per the provisions of the Sale of Goods Act, 1930?
Answer :
Explain the kinds of share capital as per the Companies Act, 2013. Also, explain when the capital shall be deemed to be preference capital.
Answer :
"Mere silence does not amount to fraud." Explain the statement as per the provisions contained in the Indian Contract Act, 1872.
Answer :
Mere silence not amounting to fraud:
Mere silence as to facts likely to affect the willingness of a person to enter into a contract is no fraud; but where it is the duty of a person to speak, or his silence is equivalent to speech, silence amounts to fraud.
It is a rule of law that mere silence does not amount to fraud. A contracting party is not duty bound to disclose the whole truth to the other party or to give him the whole information in his possession affecting the subject matter of the contract.
The rule is contained in explanation to Section 17 of the Indian Contract Act which clearly states the position that mere silence as to facts likely to affect the willingness of a person to enter into a contract is not fraud.
Exceptions to this rule:
(i) Where the circumstances of the case are such that, regard being had to them, it is the duty of the person keeping silence to speak. Duty to speak arises when one contracting party reposes trust and confidence in the other or where one party has to depend upon the good sense of the other (e.g. Insurance Contract).
(ii) Where the silence is, in itself, equivalent to speech.
State the rules that should be observed by the partners in settling the accounts of the firm after dissolution under the Indian Partnership Act, 1932?
Answer :
Mode of Settlement of partnership accounts:
As per Section 48 of the Indian Partnership Act, 1932, in settling the accounts of a firm after dissolution, the following rules shall, subject to agreement by the partners, be observed: -
(i) Losses, including deficiencies of capital, shall be paid first out of profits, next out of capital, and, lastly, if necessary, by the partners individually in the proportions in which they were entitled to share profits;
(ii) The assets of the firm, including any sums contributed by the partners to make up deficiencies of capital, must be applied in the following manner and order:
(a) in paying the debts of the firm to third parties;
(b) in paying to each partner rateably what is due to him from capital;
(c) in paying to each partner rateably what is due to him on account of capital; and
(d) the residue, if any, shall be divided among the partners in the proportions in which they were entitled to share profits.
MTK Private Limited is a company registered under the Companies Act, 2013 on 5th January, 2021 The company has not started its business till now. On 7th April, 2023, a notice has been received from ROC for non-filing of FORM No-INC-20A. Identify under which category MTK Private Limited company is classified. Explain the definition of the category of the company in detail.
Answer :
Section : B
Read the passage carefully and answer the questions given below.
There are sevrel indictors of a developed nations, it is economically agriculturally and technologically advanced. There is all round prosperit The benefits of prosperity reach the comman people illiteracy, ignorance, disease and inqualies are readuce to a minimun quality goods are prouduce in abundance and export keep on rising The nation is able to protect its sovereignty as it is self-reliant in defence and has a standing in the international forum. India, even after more than seventy-six years since independence is branded as a developing country Achieving a developed status means the major transformation of our national economy to make it one of the largest economies of the world, where people live well and above the poverty line The transformation can be materialised within the next 15 to 20 years as India has the necessary potential. Our natural resources are richer as compared to those of many other countries. We have abundant supplies of all the ores and minerals. We have rich bio-diversity, abundant sunshine, varied agro-climatic conditions and plenty of rainfall all over India. The country either, already has the necessary technologies or can develop them easily- Our people and our farmers not only have a great learning capability but most of them also have an entrepreneurial and competitive spirit Avenues to channelise this spirit constructively and productively are required. We need the will to take action and commit ourselves to be one of the world leaders, We mustresolve to work hard with a long-term vision. Technolony is the bighest wealth generator in the shortest possible time fit can provide us with infrastructure and help transform education and training, food and processing, industries and agriculture. It is the key to achieving quality. in an incrensingly competitive market and to continually upgrading human skill. It is the only vital input for ensuring health security and better living conditions for people. It can enable us to double cereals by 2030 and to make arrangements for their storage, transportation, distribution and marketing. It can make us leaders in machine tool industries. Through software engineering, we can enter computer-aided design and computer-aided manufacturing. Therefore, the major role in India's development is to be played by the vast pool of our talented scientists, researchers and technologists)They should shed pessimism and think big because they are the only ones who understand the forces of technological modernization. They should take it as a challenge to make India a developed country. They must spearhead the movement by talking about what can be done and encouraging people that difficulties can be overcome. They must extend all possible help to industries, business managers, administrators, and others.
i) Mention the basic fields in which a developed country is advance.
ii) what is required for achieving the developed country status for India?
iii) "Technology is the higest wealth generation in the shortest time" How?
iv) Who can play a major role in india's development?
v) Who can play a major role in india's development?
Answer :
Read the passage :
How does television affect our lives? It can be very helpful to people who carefully choose the shows that they watch. Television can increase our knowledge of the outside world; there are high quality programmes that help us understand many fields of study, science, medicine, and the arts and so on. Moreover, television benefits very old people who can't often leave the house, as well as patients in hospital. It also offers non-native speakers the advantage of daily informal language practice. They can increase their vocabulary and practice listening.
On the other hand, there are several serious disadvantages to television.Of course, it provides us with a pleasant way to relax and spend our free time, but in some countries, people watch the 'boob-tube' for an average of six hours or more a day. Many children stare at a television screen for more hours each day than they do anything else, including studying and sleeping. It's clear that the tube has a powerful influence on their lives and that its influence is often negative.
Recent studies show that after only thirty seconds of watching television, a person's brain 'relaxes' the same way that it does just before the person falls asleep. Another effect of television on the human brain is that it seems to cause poor concentration. Children who view a lot of television can often concentrate on a subject for only fifteen wenty minutes. They can pay attention only for the amount of time between commercials.
Another disadvantage is that television often causes people to become dissatisfied with their own lives. Real life does not seem as exeiting to these people as the lives of actors on the screen. To many people television becomes more real than reality and their own lives boring.Also many people get upset or depressed when they can't solve problems in real life as quickly as television actors seem to.
Before a child is fourteen years old, he or she views eleven thousand murders on the tube. He or she begins to believe that there is nothing strange about fights, killings and other kinds of violence. Many studies show that people become more violent after certain programmes. They may even do the things that they saw in a violent show.
i) Make Notes, using heading, sub- heading and Abbreviation whenever necessary.
ii) Write a summary giving a suitable title.
Answer :
What do you mean verbal communication?
Answer :
(i) Select the suitable antoym for the word given under :
TYRANNY
(a) Hatred
(b) Mystery
(c) Autonomy
(d) Oppression
Answer :
(ii) Correct the following sentence :
If he came to me, I would have given him a pen.
Answer :
(iii) Root of the word 'Anthropology' is :
(a) Study
(b) Anthrop
(c) Mankind
(d) Man
Answer :
Write a précis and give appropriate title to the passage given below.
English education and English language have done immense goods to India, in spite of their glaring drawbacks. The notions of democracy and self-government are the born of English education. Those who fought and died for Mother India's freedom were nursed in the cradle of English thought and culture. The West has made contribution to the East. The history of Europe has fired the hearts of our leaders. Our struggle for freedom has been inspired by the struggles for freedom in England, America and France. If our leaders were ignorant of English and if they had not studied this language, how could they have been inspired by these heroic struggles for freedom in other lands? English, therefore, did us great good in the past and if properly studied will do immense good in future.
English is spoken throughout the world. For international contact our commerce and trade, for the development of our practical ideas, for the scientific studies, English-is indispensable "English is very rich in literature," our own literature has been made richer by this foreign language. It will really be a fatal day if we altogether forget Shakespeare, Milton, Keats and Shaw.
Answer :
Title: The Goodness of English
Notwithstanding its various defects, English education has done great good to India. The ideas of democracy and self-government are its gifts. Nursed on English education, the Indian leaders were inspired by the Western thought, culture and freedom struggles. They fought for and won their motherland's freedom. Being spoken the world over, English is necessary for international contact, trade, commerce and science. English is rich in literature and has enriched our literature as well.
What do you mean by star Network Communication?
Answer :
Star Network: has multiple channels of network in communication. This network allows a group communication and is useful especially where teamwork is involved. The members communicate and exchange information with each other freely, and without hindrance or hesitation. The usefulness of all networks depends on the structure and size of the company, and the manner of communication between the employees.
OR
"Coherence" is an important feature of communication. Discuss.
Answer :
Coherence in writing and speech refers to the logical bridge between words, sentences, and paragraphs. Main ideas and meaning can be difficult for the reader to follow if the writer jumps from one idea to another and uses contradictory words to express himself/herself. The key to coherence is sequentially organised and logically presented information which is easily understood. All content under the topic should be relevant, interconnected and present information in a flow.
(i) Choose the word which is best expresses the meaning of the given word:
FERRY
(a) Bargain
(b) Celebrate
(c) Transport
(d) Drown
Answer :
(ii) Change the following sentence to indirect speech:
My friend said to me ,"Has your father returend from Kolkata "?
Answer :
(iii) Change the following sentence into passive Voice .
"Please sit here and wait till I return".
Answer :
Prepare the Minutes of a Meeting, presided by a committee under the chairmanship of the Managing Director Ms. U; Product Head and Sales Head of LHO Private Simited, a Garments Company. The main agenda of the meeting was introducing a new Denim Jeans, analysing the cost, discussing the sales and marketing strategies.
Answer :
How does organization structure become a barrier to communication? Explain .
Answer :
(i) Change the sentance from Active to Passive voice :
They forced him to steal the money out of his dad's room.
Answer :
(ii) Change the sentence from passive to Active voice
Let the class not be disturbed
Answer :
(iii) Change the following sentence into Direct speech
The boys exclaimed with joy that they had won the match.
Answer :
You are a Finance Manager of 87Z Limited, A to Z Complex, Technology Nagar, FF State, India (e-mail; atz@gmail.com, Tel.: XXXXX). Your company is going to distribute 500 laptops to a research institute under its Corporate Social Responsibility (CSR), initiatives. Write an enquiry letter to Z Tech Limited, NK Complex, FF State, India for supply of 500 Laptops making comprehensive enquiry about configuration, costs, delivery and terms and conditions ete.
Answer :
What is Para language in communication? Explain it.
Answer :
Paralanguage: It is the manner in which we say something, more than the actual words used, reveal the intent of the message. The voice quality, volume, intonation, pitch, stress, tone and style of speaking communicates approval, interest or lack of it.
(i) Select the correct meaning of Idioms /Phrases given below:
' Gift of the gab '
Answer :
(ii) Select the correct meaning of Idioms /Phrases given below:
A red letter day
(a) An important day
(b) An auspicious day
(c) A dangereous day
(d) An unimportant day
Answer :
(iii) Select the correct meaning of the colloction given below :
Dollar diplomacy
(a) Make money
(b) Go bankrupt
(c) Profit earning
(d) Cash flow
Answer :
The number of women in the police force seems insufficient especially when we see the increasing infilyement of women in terrorist activities. Write an article in 250 words for "The Hindustan Chronicle", on the need of having more women in the police force.
Answer :
Ruchika Saboo
An All India Ranker (AIR 7 - CA Finals, AIR 43 - CA Inter), she is one of those teachers who just loved studying as a student. Aims to bring the same drive in her students.
Ruchika Ma'am has been a meritorious student throughout her student life. She is one of those who did not study from exam point of view or out of fear but because of the fact that she JUST LOVED STUDYING. When she says - love what you study, it has a deeper meaning.
She believes - "When you study, you get wise, you obtain knowledge. A knowledge that helps you in real life, in solving problems, finding opportunities. Implement what you study". She has a huge affinity for the Law Subject in particular and always encourages student to - "STUDY FROM THE BARE ACT, MAKE YOUR OWN INTERPRETATIONS". A rare practice that you will find in her video lectures as well.
She specializes in theory subjects - Law and Auditing.
Yashvardhan Saboo
A Story teller, passionate for simplifying complexities, techie. Perfectionist by heart, he is the founder of - Konceptca.
Yash Sir (As students call him fondly) is not a teacher per se. He is a story teller who specializes in simplifying things, connecting the dots and building a story behind everything he teaches. A firm believer of Real Teaching, according to him - "Real Teaching is not teaching standard methods but giving the power to students to develop his own methods".
He cleared his CA Finals in May 2011 and has been into teaching since. He started teaching CA, CS, 11th, 12th, B.Com, M.Com students in an offline mode until 2016 when Konceptca was launched. One of the pioneers in Online Education, he believes in providing a learning experience which is NEAT, SMOOTH and AFFORDABLE.
He specializes in practical subjects – Accounting, Costing, Taxation, Financial Management. With over 12 years of teaching experience (Online as well as Offline), he SURELY KNOWS IT ALL.
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