PROGRAM - MBA

SUBJECT CODE & NAME MB0051 LEGAL ASPECTS

OF BUSINESS
1.
Narrate the exceptions to the rule No
consideration no contract. How is a contract
discharged?
No consideration, no contract

Sections 10 and 25 of the Contracts Act deal with the maxim no

consideration, no contract. A promise without consideration cannot create a
legal obligation. A person who makes a promise to do or abstain from doing
something usually does so as a return of some loss, damage or
inconvenience that may have or may have been occasioned to the
other party with respect to the promise. A consideration must move at the
desire of the promisor; it can be from the promisee or any other
person. The consideration must be real and, need not be adequate; it can be
given in the past, present or future. In the next section, we will deal with
performance of contracts.
Discharge of Contracts
Discharge refers to the termination of contractual relationship between the
parties. The contract ceases to operate, i.e., when the rights and obligations
under the contract ends.

CONTACT US FOR READY MADE SOLVED

ASSIGNMENTS
CONTACT NUMBER : +91 - 9540358147
EMAIL ID : SMUDOC@GMAIL.COM

2.
Narrate the rights and liabilities of a surety in a
contract of guarantee.

Rights of a Surety
Rights of surety may be classified under three heads:

Rights against the creditor

Rights against the principal debtor
Rights against co-sureties

1. Rights against the creditor

In case of fidelity guarantee, the surety can direct a creditor to dismiss the
employee whose honesty he/she has guaranteed, in the event of
proven dishonesty of the employee. The creditors failure to do so will
exonerate the surety from his/her liability.

CONTACT US FOR READY MADE SOLVED

ASSIGNMENTS
CONTACT NUMBER : +91 - 9540358147
EMAIL ID : SMUDOC@GMAIL.COM
3. When and how is a partnership and firm get dissolved?
Dissolution
Dissolution of firms and partnerships
Section 39 provides that the dissolution of partnership between all the
partners of a firm is called the dissolution of the firm. It follows that if the
dissolution of partnership is not between all the partners, it would not
amount to dissolution of firm, but it would nevertheless be dissolution of
partnership. Thus, dissolution of firm always implies dissolution of
partnership, but dissolution of partnership need not lead to dissolution
of

CONTACT US FOR READY MADE SOLVED

ASSIGNMENTS
CONTACT NUMBER : +91 - 9540358147
EMAIL ID : SMUDOC@GMAIL.COM

4. (a) Narrate the Latin maxim Nemo dat quod non

habet and its exceptions in sale of Goods Act 1930.
(b) A sells certain goods to B and promises
goods on the next day. But before delivery
delivers the goods to C who buys those
and without knowledge of the prior sale to
remedy in such circumstances.

to
A
in
B.

deliver the
sells and
good faith
Explain Bs

(c) A, B and C are three brothers who owned a 3-story

building, each of them agreed to share a floor. The
building was constructed by the supervision of A, who had
a general power of attorney given by B and C. A, B
and C contributed equally to the construction of the
property. C was staying abroad and was supposed to
occupy his flat at a later date. Meanwhile A sells Cs flat
to X by virtue of the general power of attorney.
Give your comments.
Answer:
4 (a) Narrate the Latin maxim Nemo dat quod non habet
Transfer of title by non-owners is discussed in Sections 27-30. Section 27
lays down a general rule as to transfer of title, that is, it is only the owner of
goods who can transfer a good title. No one can give a better title than what
that has. This rule is expressed by the maxim, Nemo dat quod non habet,'
which means that no one can give what he himself has not. If the

CONTACT US FOR READY MADE SOLVED

ASSIGNMENTS
CONTACT NUMBER : +91 - 9540358147
EMAIL ID : SMUDOC@GMAIL.COM
5. Section 16 of the Companies Act, 2013 provides the
rules for alteration of Memorandum of Association. Explain
the rules.
Memorandum of Association
Meaning and purpose: The Memorandum of Association (MoA) of a
company is its charter that contains the fundamental conditions on which
the company is incorporated. It tells us the objects of the companys
formation and the utmost possible scope of its operations. Thus, it defines
as well as confines the powers of
the company. Any act beyond the scope of the memorandum is considered
to be ultra vires (beyond powers of) and is void.
The MoA serves two purposes:

It enables shareholders, creditors and persons who deal with the

company to know the scope of its powers and range of its activities.

CONTACT US FOR READY MADE SOLVED

ASSIGNMENTS
CONTACT NUMBER : +91 - 9540358147
EMAIL ID : SMUDOC@GMAIL.COM

6.
Narrate
the
prohibition of anti-competitive
agreements and abuse of dominant position as per
Competition Act, 2002.
Prohibition of Anti-competitive Agreements
Section 3 provides for prohibition of entering into anti-competitive
agreements. Accordingly, no enterprise or person or association of
enterprises/persons shall enter into any agreement in respect of production,
supply, distribution, storage, acquisition or control of goods or provision of
services, which causes or is likely to cause an appreciable adverse effect on
competition within India. Any agreement entered into in contravention of this
provision shall be void.
Further, this section also specifies certain activities that shall be presumed
to have an appreciable adverse effect on competition. Any enterprise
or person or association of enterprises/persons, including cartels, shall
be presumed to have an appreciable adverse

CONTACT US FOR READY MADE SOLVED

ASSIGNMENTS
CONTACT NUMBER : +91 - 9540358147
EMAIL ID : SMUDOC@GMAIL.COM