403R - Business Laws Full Material
403R - Business Laws Full Material
403R - Business Laws Full Material
3. Bailment Unit-2
Sec. 148 defines Bailment as” the delivery of
goods by one person to another for some Q.1.What are the distinguishing features
purpose, upon a contract, that they shall, when between Express and Implied condition and
the purpose is accomplished, be returned or warranties?
otherwise disposed of according to the
directions of the person delivering them”. The
person delivering the goods is called the
Comparison Chart
„bailor‟ and the person the person to whom they
are delivered is called the „bailee‟.
expression must be spelled out and interpreted. written. Conversely, in an implied contract is
It encompasses a certain proposal, unconditional formed out of the deeds or conduct of the
acceptance and adequate consideration. parties concerned.
Trust agreement between the author and
For example: John writes a letter to Harry, trustee is an example of an express contract.
offering to sell his house to him for 28 lakhs. As against, receiving cash from automated
Harry, by a written letter, gives his acceptance teller machine is a great example of implied
of the proposal. Such a contract is known as an contract.
express contract.
Q.2.Define Negotiable Instrument and
Definition of Implied Contract Discuss Main Features of Negotiable
Implied Contract means a contract which is Instrument?
inferred by the activities and conduct of the
parties concerned. In other words, a contract in Definition of Negotiable Instruments
which the elements, i.e. offer and acceptance is meaning – It is just a document that has features
made, without the use of words, then this type of of monetary worth and transferability.
contract is known as implied contract. Such a Section 13(1) says NIs include promissory
contract come into being from the assumed notes, bills of exchange or cheques payable
intention of the parties. It can be of two types: either to order or to bearer
endorse this note and give it to B and clear of his of cheque (person holding the cheque) or to any
dues this way. other person who is specifically to be paid as per
instructions given.
However, the seller isn‟t bound to accept the
promissory note. The reputation of a buyer is of Cheques could be a good way of paying different
great importance to a seller in deciding whether kinds of bills. Although the usage of cheques is
to accept the promissory note or not declining over the years due to online banking,
individuals still use cheques for paying for loans,
2. Bill of exchange college fees, car EMIs, etc. Cheques are also a
Bills of exchange refer to a legally binding, good way of keeping track of all the transactions
written document which instructs a party to pay on paper. On the other side, cheques are
a predetermined sum of money to the comparatively a slow method of payment
second(another) party. Some of the bills might and might take some time to be processed.
state that money is due on a specified date in the
future, or they might state that the payment is The Negotiable Instruments (Amendment)
due on demand. Bill, 2017
The Negotiable Instruments (Amendment) Bill,
A bill of exchange is used in transactions 2017 has been introduced in the Lok Sabha
pertaining to goods as well as services. It is earlier this year on Jan 2nd, 2018. The bill seeks
signed by a party who owes money (called the for amending the existing Act. The bill defines
payer) and given to a party entitled to receive the promissory note, bill of exchange, and
money (called the payee or seller), and thus, this cheques. The bill also specifies the penalties for
could be used for fulfilling the contract for dishonor of cheques and various other violations
payment. However, a seller could also endorse a related to negotiable instruments.
bill of exchange and give it to someone else, As per a recent circular, up to INR 10,000 along
thus passing such payment to some other party. with interest at the rate of 6%-9% would have to
be paid by an individual for cheques being
It is to be noted that when the bill of exchange is dishonored.
issued by the financial institutions, it‟s usually The Bill also inserts a provision for allowing the
referred to as a bank draft. And if it is issued by court to order for an interim compensation to
an individual, it is usually referred to as a trade people whose cheques have bounced due to a
draft. dishonouring party (individuals/entities at fault).
Such interim compensation won‟t exceed 20
A bill of exchange primarily acts as a percent of the total cheque value.
promissory note in the international trade; the
exporter or seller, in the transaction addresses a
bill of exchange to an importer or buyer. A third
party, usually the banks, is a party to several
bills of exchange acting as a guarantee for these
payments. It helps in reducing any risk which is
part and parcel of any transaction.
3. Cheques
A cheque refers to an instrument in writing
which contains an unconditional order,
addressed to a banker and is signed by a person
who has deposited his money with the banker.
This order, requires the banker to pay a certain
sum of money on demand only to to the bearer
Prepare By : S.Charan, MBA, Assistant Professor. 4
Wings Business School, Tirupati
403-BUSINESS LAW AND ETHICS
A number of powers and duties can be The chairman of the board of directors,
exercised by the board of directors in beyond the duties mentioned above, must
board meetings. fulfill the
It is the duty of a director to attend The qualifications of the chairman are
board meetings. slightly different from the qualifications
Board meetings should be held from of directors as follows −
time to time. The chairman must not be an
If a director is unable to attend three executive director.
consecutive board meetings or all the The chairman must not be involved
meetings for three months without the in day to day management.
consent of the other board members, his The chairman must not be an auditor.
office will fall vacant. The chairman must not be a legal
General Duties of a Director consultant.
A director must fulfill the following The chairman must not be an
general duties − employee of the company.
Duty of Good Faith The chairman must not be a staff of
Duty of Care the company.
Duty Not to Delegate The chairman must not be an advisor
of the company.
Liabilities of Directors The chairman must not be a person
The liability of directors to the company controlling power of the company.
arises under few circumstances. The chairman must not be a person
Breach of Fiduciary Duty controlling power of the associated
Ultra-verse Acts company.
Negligence The chairman must not be a person
Mala Fide Acts controlling power of the auditing
company.
The chairman must not be a person
Appointment and Removal of Directors
The appointment and recruitment of who may have conflict of interest.
directors is a crucial procedural Removal of Directors
requirement of a company. In accordance The removal of a director before the expiry
of his term in the office can be done by
with the Companies Act, 1956, only an
passing an ordinary resolution in the
individual can be appointed as a director of
general meeting of a company after the
a company.
issuance of a special notice. However, the
Qualifications of Directors
above process is not applicable for
1. General Qualifications
promotional directors or directors
A director having a professional and ethical
appointed by the government.
mind should have knowledge and
experience in specific fields. With a
commitment to create long term values and Q.2.Illustrate Environment Protection
commitment to the shareholders, a director Act?
should fully understand his obligations and The Environment (Protection) Act was
practices. enacted in the year 1986.
Article 48A of the Constitution specifies
2. Specific Qualifications
that the State shall endeavor to protect and
Prepare By : S.Charan, MBA, Assistant Professor. 6
Wings Business School, Tirupati
403-BUSINESS LAW AND ETHICS
d) laying down standards for emission or n) such other matters as the Central
discharge of environmental pollutants from Government deems necessary or expedient
various sources whatsoever: Provided that for the purpose of securing the effective
different standards for emission or implementation of the provisions of this
discharge may be laid down under this Act.
clause from different sources having regard
to the quality or composition of the Powers of the Court
emission or discharge of environmental
pollutants from such sources; Directions issued to control vehicular
e) restriction of areas in which any pollution
industries, operations or processes or class In Mehta v Union of India (1998) 6 SCC
of industries, operations or processes shall 63, in order to control the chaotic traffic
not be carried out or shall be carried out conditions and vehicular pollution, the
subject to certain safeguards; Supreme Court issued the following
f) laying down procedures and safeguards directions.
for the prevention of accidents which may (a) All commercial/transport vehicles
cause environmental pollution and remedial which are more than 20 years old should be
measures for such accidents; phased out and not permitted to ply in
g) laying down procedures and safeguards Delhi after October 1998
for the handling of hazardous substances; (b) All such commercial /transport vehicles
h) examination of such manufacturing which are 17 to 19 years old (3200) shall
processes, materials and substances as are not be permitted to ply in the National
likely to cause environmental pollution; Capital Territory, Delhi after 1998;
i) carrying out and sponsoring (c) Such of the commercial /transport
investigations and research relating to vehicles which are 15 and 16 years old
problems of environmental pollution; (4962) shall not be permitted to ply after
j) inspection of any premises, plant, December 31, 1998
equipment, machinery, manufacturing or
other processes, materials or substances Protection of Coastline of India
and giving, by order, of such directions to In Indian Council for Enviro-Legal Action
such authorities, officers or persons as it v Union of India22 the Supreme Court in
may consider necessary to take steps for the regard to the 600 kms long coast line
prevention, control and abatement of emphasized that that it would be the duty
environmental pollution; and responsibility of the coastal states and
k) establishment or recognition of Union Territories in which the stretch
environmental laboratories and institutes to exists, to see that the notifications issued,
carry out the functions entrusted to such declaring the coastal stretches should be
environmental laboratories and institutes properly and duly implemented.
under this Act;
l) collection and dissemination of
information in respect of matters relating to
environmental pollution;
m) preparation of manuals, codes or guides
relating to the prevention, control and
abatement of environmental pollution;
Prepare By : S.Charan, MBA, Assistant Professor. 8
Wings Business School, Tirupati
403-BUSINESS LAW AND ETHICS
remedies by providing financial support a public authority under any other law for
and legal assistance for the benefit of the time being in force.
consumers, particularly, groups with What is Record?
similar grievances in cases involving Record includes •Any document,
significant public interest and injustice. manuscript and file •Any microfilm,
microfiche and facsimile copy of a
Q.2.Give a Detail of Right to document •Any reproduction of image or
Information Act? images embodied in such microfilm
The RTI Act 2005: Why-n-What An Act (whether enlarged or not); and •Any other
To provide for setting out the practical material produced by a computer or any
regime of Right to Information for citizens other device
to secure access to information under the Who is Public Authority?
control of public authorities, in order to It is any authority or body or institution of
promote transparency and accountability in self-government established or constituted.
the working of every public authority, the • By or under the Constitution • By any
constitution of a Central Information other law made by Parliament • By any
Commission and State Information other law made by State Legislature • By
Commissions and for matters connected notification issued or order made by the
therewith or incidental thereto. appropriate Government, and includes any-
The RTI Act 2005: When-n-Where This body owned, controlled or substantially
Act may be called the Right to Information financed, nonGovernment organization
Act, 2005. The RTI act 2005 was enacted substantially financed, directly or indirectly
by permission and authority of His by funds provided by the Govt.
Excellency, President of India. This act was The RTI Act 2005: How
enacted by the Parliament on How To Request Information? A person,
15.06.2005 and notified in the Gazette of who desires to obtain any information
India dated 21.06.2005. It extends to the under this Act, shall make a request in
whole of India except the State of Jammu writing or through electronic means in
and Kashmir. English or Hindi or in the official language
of the area in which the application is being
The RTI Act 2005: Who made, accompanying such fee as may be
Who can exercise his / her right under The prescribed, to public authority by providing
RTI Act 2005? The answer is: Subject to contact details.
the provisions of this Act, all citizens shall The RTI Act 2005:
have the right to information. Fee Is There Any Fee To Seek
Information? FEE TO BE ACCOMPANIED
The RTI Act 2005: Definitions WITH THE RTI APPLICATION
What is Information? Information means • In case of central govt. departments, INR
any material in any form, including 10.00 by way of cash under proper receipt,
records, documents, memos, e-mails, demand draft, bankers cheque, Indian
opinions, advices, press releases, circulars, postal order, money order or cash deposited
orders, logbooks, contracts, reports, papers, at designated post offices.
samples, models, data material held in any • In case of state govt. departments,
electronic form and information relating to particularly in Maharashtra state, INR
any private body which can be accessed by 10.00 by way of cash under proper receipt,
Prepare By : S.Charan, MBA, Assistant Professor. 11
Wings Business School, Tirupati
403-BUSINESS LAW AND ETHICS
Marketing is the heart of all businesses and not a need till yesterday and only a luxury.
all other functions depend upon the same for Today cell phones have become a need and
keeping the business moving. It is one a status symbol! These are issues that are
business function that interacts the most being discussed in marketing ethics
with markets, in fact markets are meant to nowadays. Marketing ethics is in its budding
sell and they exist only when they sell! In stage only considering that it came into
such a scenario there are bound to be being only in late 1990s.
multiple players and a clash is inevitable.
Such clash leads to malpractices like Q.2 Explain The Concept and Importance
hoarding, price competitions, brand wars of Social Responsibilities of Business?
and use of unfair tactics, which is precisely
where marketing ethics come into play.