Introduction to Law – CS Foundation Business Law Notes

Introduction:
1. Law is an instrument to regulate human behaviour – be it social life or business life.

2. There is lack of unanimity on true nature and meaning of iaw as it has been viewed by different jurists from different view points.

3. Various definitions can be grouped into 5 heads:

Natural
Positivistic
Historical
Sociological
Realistic

Natural School:

“The art or science of what is equitable and good”
“The highest reason implanted in nature”
“The standard of what is just and unjust”
As per Romans ‘justice’ is the main and guiding element of law.
As per Hindu view, law is a part of “Dharma.”
“The body of principles recognised and applied by the state in the administration of justice”
“A set of rules imposed and enforced by society with regard to the attribution and exercise of power over persons and things”

Positivistic Definition of Law:

“Law is the aggregate of rules set by man as politically superior or sovereign, to men as political subject”.
“In other words, law is the “command of the sovereign”.
3 elements of law includes: command, duty and sanction.
“Law is a normative science”.
Grund Norm is the ultimate norm from which ail other norms derive their power.

Historical Definition of Law:
1. Savigny’s gave following point.

Law is a matter of unconscious and organic growth
It is not universal in native
It must be as per the popular custom
Legislation is last stage of law making

2. Law has close association with following two notions:

Notion of order
Notion of force

Sociological Definition of Law:

“Essentially and exclusively as social fact”.
“The form of the guarantee of the conditions of life of society, assured by State’s power of constraint”.
Law is a social institution to satisfy social wants.

Realist Definition of Law:

“Law is a statement of the circumstances in which public force will be brought to bear upon through courts.”
“A principle or rule of conduct so established as to justify a prediction with reasonable certainty that it will be enforced by the courts if its authority is challenged, is a principle or rule of law”.

Characteristics of Law:
1. Law pre supposes a state which makes, authorizes to make, recognises or sanctions rules called as law. These rules are made to serve some purpose.

2. Law is made effective by:

Requiring damages to be paid for an a jury due to disobedience.
Requiring one to complete an obligation that he has failed to perform.
Preventing disobedience.
Administering some form of punishment.

3. Meaning of Law – It refers to the rule of conduct to be followed by people, formulated by the state in order to maintain peace and order in the society.

Significance of Law:

It provides hope of security for future.
It provides socio-economic justice
It removes the existing imbalances in the socio-economic structure.
It helps in achieving socio-economic goals contained in our constitution.
It serves as a vehicle of social change.
Law needs to be constantly changed in order to bring it in conformity with the general statements and customs.

Sources of Law:

Source means origin
Law originates from the sovereign.
It originate from Volkgeist – general consciousness of the people
Roscoe pound analysed the term “law” in the 20^th century.
Law originates from God.
Vedas is primary source of Hindu law
Quran is primary source of Mohammedan law.

Principle Sources of Indian Law:

It includes the following:
(1) Customs / Customary Law –

Most ancient of all sources.
When same thing was done again and again in a particular way, it became a custom.
Smritis and Commentaries are based on customs.
It has a inferior place in Mohammedan law.
Sunnis have interpreted law of divorce and inheritance based on custom.

Customs are divided into:
(i) Customs without sanction/Positive morality are non-obligatory and are just observed due to pressure of public opinion.

(ii) Customs having sanction are enforced by the state.

Legal Customs:

are enforced by courts
have become a part of law of land
operate as a binding rule of law

(a) Local Customs:

prevails in some definite locality
source of law for that particular place only
they are of 2 types:
Geographical local customs
Personal local customs

(b) General Customs:

prevail throughout the country
one of the sources of law of land

Conventional Customs:

also known as “usages”
are binding due to an agreement between the parties.

Following conditions to be satisfied, before it is adopted:

Clearly established and known to the contracting parties.
Cannot alter the general law of the land.
Must be reasonable.

Custom to be valid requires the following conditions to be fulfilled:
(a) Immemorial or Antiquity: It must be ancient English law placing limit to legal memory does not apply to Indian law.

According to Blackstone, “A custom, in order that it may be legal and binding must have been used so long that the memory of man runs not to the contrary, so that, if any one can show the beginning of it, it is no good custom.”

(b) Reasonableness: It must be useful to the society and must not be opposed o principles of equity, justice and good conscience.

(d) Certainty: It must be definite and certain, rather than being vague and ambiguous.

(e) Compulsory observance: It must have been continuously and compulsory observed without interruption from long time.

(f) Unanimity of opinion: It must be universal in nature.

(g) Consistency: One custom must not conflict with other established customs.

(h) Peaceful enjoyment: It must be observed peacefully in all law courts without any conflicts.

(2) Judicial Decisions / Precedents: (Past decisions)

‘Precedent’ refers to some pattern set for guiding the future conduct.
Decisions laying down some new rule or principle are called Judicial Precedents.
The principles of law that are expressed for the first time in court decisions becomes precedent which are to be followed as law in future while deciding identical problems and cases.
This rule of a court decision becoming precedent to be followed in future cases is known as doctrine of stare decisis.
This creates confidence in the minds of litigants.
Justice administration becomes fair and equitable.

General Principles:

Lower Court is bound by decisions of Higher Court.
Higher Courts are bound by their own decisions.

High Court’s Principles in Particular:

High Court’s decisions are binding on all subordinate courts and tribunals within its jurisdiction.
High Court’s decision have a persuasive value in a court which comes under jurisdiction of another court.
The rule that a court decision becomes precedent to be followed for similar cases.
In case of any conflict, decision of High Court within whose jurisdiction that court comes, will prevail.
In case of any conflict between decisions of two co-equal benches, later decision is followed.
Smallest Bench is formed by a single judge.
Division Bench means bench of two judges.
Full Bench means bench of three or more judges.
Decision of Full Bench is binding on Smaller bench.
Even a wrong decision of Division Bench is binding on Smaller Bench.
High Courts are courts of co-ordinate jurisdiction.
Pre-constitution privity council decisions are binding on the High Courts unless overruled by the Supreme Court.

Supreme Court’s Principles in Particular:

Supreme Court is the highest court.
Its decisions are binding on all courts within the territory of India and other judicial tribunals of the country.
Only the statement of ratio of the judgement have the binding force.
It is not bound by its own decisions.
Earlier decisions can be departed from only if found erroneous and is detrimental to the general public welfare.
English decisions have persuasive value in India.
It is not bound by the decisions of Privity Council or Federal Court.

Precedents are of following kinds:
1. Declaratory: It is an application of an already exiting law. According to Salmond, “A declaratory precedent is one which is merely the application of an already existing rule of law. ”

2. Original: It creates and applies a new rule of law. It creates law for future. It develops law of the country.

3. Persuasive: It does not creates any obligation on the judge to follow but deserves to be attached great weight. It is a historical source of law rather than a legal source.
These are not compulsory to be followed but are considered by the judges to give their decision.

4. Absolutely Authoritative: It creates a binding force on the judge and he is bound to follow it whether he approves it or not. It is a legal source of law. These are compulsorily required to be followed.

5. Conditionally Authoritative: Though binding on the judge, it can be disregarded if it is considered wrong or contrary to law. (The rule is that a court decision becomes precedent to be followed for similarly cases)

Doctrine of Stare Decisis:

It refers to adhere to the decision and not unsettle thing which are established.
Law already settled by a series of decisions becomes binding on the courts and have to be followed in
similar cases.
Like cases are decided alike.
It is not universally applicable.
It should not be applied at the cost of justice.

Ratio Decidendi.
The court while giving the decision give the importance to those certain points which leads into giving the decision. Such points are known as ratio decidendi:

It is a decision based on the material facts of a case (Prof. Goodhart)
It is binding between the contracting parties.
It is equally applicable to other cases of similar nature.

Obiter Dicta:

The Judges are not bound to follow them although they can take advantage of them.
They sometimes help the cause of the reform of law.
It means “said by the way”.
It is a persuasive precedent.
These are the statements that are not necessary for a particular decision’s case but occur in the course of delivering a judgement.
Judges can take advantage of it.
It can also be a deliberate expression of opinion.
The word “law declared” includes an obiter dictum provided it is upon a point raised and agreed.

(3) Statutes / Legislation:

Also referred as Jus Scriptum meaning written law, or Jus non-Scriptum meaning unwritten law, Salmond prefers to call it as “enacted law”.
It is consisted in the declaration of legal rules by an authority duly empowered by the constitution in this behalf.
Various statutory laws are created by legislation.
Legislation can be Supreme, or and Subordinate.
Supreme legislation directly derives its power from the constitution. Thus, cannot be repealed, annulled or controlled by any other legislative authority.
Subordinate legislation proceeds from any authority other than sovereign power.
Parliament possesses power of Supreme Legislation.
The power given to the executive to make rules in some cases is known as executive or delegated legislation.
Rules made by executive have to be placed on the table of both the houses of Parliament for a specified time. After being approved by legislature, it becomes a part of legislation.
Supreme Legislation includes acts of parliament and the ordinances, other laws made by President and Governor.
Subordinate legislation includes legislation made by various authorities like corporation, municipalities etc.

(4) Personal Law:
It is applied where any point of the issue in not covered by any statutory law or custom.

Hindu’s law is found in:

The Shruti which includes 4 Vedas
The Smritis which are of 3 types – the codes of Manu, Yajnavalkya and Narada.

Mohammedan’s law is found in:

The Holy Kuran
Hadis : actions, percepts and sayings of Prophet Mohammed.
Ijmas : concurrence of opinion of the companions of Prophet and his disciples.
Kiyas : analogical deductions from Quran, Hadis and Ijmas.
Digests and Commentaries : which includes Hedaya (the most important and famous one) and Fatawa Alamgiri (complied by Aurangzeb Alamgiri)

Secondary Sources of Indian Law – It includes the following :
(1) Justice, Equity and Good Consciences

(2) Sources of English Law –

Common Law
Law Merchant
Principle of Equity
Statute Law

(1) Justice, Equity and Good Conscience :

Introduced by Impey’s Regulations of 1781
It applies in absence of any rule of a statutory law, custom or personal law.
It owes its origin to the beginning of British administration of justice in India.
They have been modified to suit the Indian conditions and circumstances.
It must not be inconsistent with any doctrine or theory of Hindu law.

(2) English Law – Main body of rules and principles of India law have been adopted from English law which in turn have been taken from following sources:
(i) Common Law:

Unwritten law of England which is common to the whole of the realm
Principles-evolved by judges while making decisions on cases brought before them.
It denotes body of legal rules which have several primary sources.

(ii) Law Merchant:

Important source of Mercantile law.
It refers to the customs and usages which are binding on traders in their dealings with each other.

(iii) Principle of Equity:

It refers to a body of rules whose primary source is neither any custom nor a written law.
In cases where anyone is not satisfied with the decision of common law, can file a writ or mercy petition
with the king (fountain head of justice). Chancellor to whom the petitions are referred by the king dispose it off as per his commonsense, natural justice and good conscience.
Law administered by chancellor is known as Equity and such courts are known as Equity courts.

(iv) Statute Law:

It refers to the law derived from the legislation or enactment of Parliament or the subordinate and delegated legislative bodies.
It is now a very important source of Mercantile law
It overrides an unwritten law
Example : Bankruptcy Act, 1914.
English Sale of Goods Act, 1893; etc.

Mercantile or Commercial Law:

It grew up from customs and usages of merchants or traders in England
Eventually become a part of common law of England
It relates to the commercial activities of people of the society
It is concerned with trade and commerce

Branches of Law:
They are:

Constitutional law (Highest and supreme law of country)
Administrative law
Criminal law
Civil law
Mercantile or commercial law Sources of Mercantile Law

Its sources are:

Law Merchant
Statute law
Common law
Principles of Equity

Mercantile Law in India :
Sources of Indian Mercantile Law:

English Mercantile Law
Statute Law
Judicial Decision
Custom and Trade Usages

Indian Contract Act, 1872 was enacted as an attempt to codify and establish uniform principles of Mercantile law in India.

Following are the sources of India Mercantile law:
(i) English Mercantile Law – Certain modifications have been made in English law to make it suitable to the Indian needs.

(ii) Statute Law

It includes the various acts enacted by India legislature.
Example – The Indian Contract Act, 1872;
The Sales of Goods Act, 1930; etc.

(iii) Judicial Decisions

In cases where law is silent, judge takes a decision based on justice, equity and good conscience.
On basis of such decisions, other cases of similar nature are decided.

(iv) Customs and Trade Usages – Various provisions of Indian statute give effect to the rules laid down in a particular Act which are subject to special custom or trade usage.

Legal Terminology and Maxims:
Legal Maxim refers to an established principle or proposition.

Term/Phrase	Meaning
ab initio	From the beginning.
ad hoc	Not intended to be able to be adapted to other purposes.
ad idem	To the same thing.
ad infinitum	To infinity
ad valorem	According to value.
alter ego	A second identity living within a person.
arhicus curiae	Friend of the court.
a udi alteram partem	Hear the other side.
bona fide	In good faith.
de facto	in fact.
de jure	In law.
de novo	A new.
dehors	Outside of.
ex gratia	As a matter of grace or favour.
ex officio	By virtue of an office.
ex parte	Expression used to signify something done or said by one person not in the presence of his opponent.
fait accompli	An accomplished act.
ictus reus	Guilty act.
in personam	Against the person.
in rem	An act/proceeding done or directed with reference to no specific person or with reference to all whom it might concern.
Inter alia	Amongst other things.
inter vivos	Between living persons.
intestate	A person is deemed to die intestate in respect of property of which he or she has not made a testamentary disposition (“will”) capable of taking effect.
intra vires	Within the powers.
ipso facto	By the mere fact.
ipso jure	By the law itself.
lis pendens	A pending suit.
locus standi	Signifies a right to be heard.
mens rea	A guilty mind.
mesne profits	Intermediate profits, the profits which a person in wrongful possession of the property actually received or might with ordinary diligence have received therefrom together with interest on such profits excluding the profits due to improvement made by the person in wrongful possession.
modus operandi	Mode of operating; the way in which a thing, cause etc. operates.
mutatis mutandis	With the necessary changes in points of detail, with such change as may be necessary.
obiter dictum	An opinion of law not necessary to the decision. An expression of opinion (formed) by a judge on a question immaterial to the ratio decidendi, and unnecessary for the decision of the particular case. It is no way binding on any court, but may receive attention as being an opinion of high authority.
pendente Iite	During litigation.
quid pro quo	The giving of one thing of value for another thing of value; one for the other; thing given as compensation.
ratio decidendi	Reasons for deciding, the grounds of decision.
res integra	An untouched matter; a point without a precedent; a case of novel impression.
res judicata	A case or suit already decided.
rule nisi	A rule to show cause why a party should not do a certain act, or why the object of the rule should not be enforced.
sine die	Without day.
sine qua non	An indispensable requisite.
stare decisis	To stand by things decided; to abide by precedents where the same points come again in litigation.
status quo	Existing condition.
sub judice	Before a judge or court, pending decision of a competent count.
ultra vires	Beyond one’s powers.

Understanding Case Citation:
1. Case Name:

Represented in Italics followed by a comma.
First name tells the person bringing the court action.
Second name is the person against whom the action is brought.
Criminal law case is always brought by the state against a person.
Defendant may not always remain same.

2. Name of Reporter
(i) It refers to a multi-volume publication where court decisions are found.

(ii) Eg. – AIR – All India Report:
ITR – Income Tax Report etc.

Full Name	Official Abbreviation	Type of Case Reported
All India Reports	AIR	Decision from SC and HC
Supreme Court Cases	SCC	Indian Supreme Court
Company Law Journal	CLJ	Decision Relating to Company Law matters
Income Tax Report	ITR	Decision Relating to Income Tax matters
Labour Reports	LR	Decision Relating to Labour Law matters

3. Beginning and Ending Page – It is important to provide the specific pages on which a quote is found if a direct quote from any case is being used.

4. Year of Decision – It refers to the year in which the court deliver the decision.
Example : Furman V. Georgia, 408 U.S. 238,240 (1972).

Multiple Choice Questions

Question 1.
Which of the following is not a definition of law:
(a) Physiological
(b) Realistic
(c) Sociological
(d) Historical
Answer:
(a) Physiological

Question 2.
As per. Romans, ________ is the main guiding force.
(a) Law
(b) Equity
(c) Justice
(d) None of these
Answer:
(c) Justice

Question 3.
law is a normative science. This definition was given by:
(a) Ulpine
(b) Austin
(c) Kelson
(d) Cicero
Answer:
(c) Kelson

Question 4.
Elements of law include:
(a) Command
(b) Duty
(c) Sanction
(d) All of the above
Answer:
(d) All of the above

Question 5.
As per Historical definition of law, it is not universal in nature.
(a) True
(b) False
(c) Partly True
(d) Partly False
Answer:
(a) True

Question 6.
________ is a primary source of Hindu law.
(a) Vedas
(b) Holy Kuran
(c) Smritis
(d) Bible
Answer:
(a) Vedas

Question 7.
________ is the most ancient source of Indian law.
(a) Judicial Decisions
(b) Personal Law
(c) Statutes
(d) Customs
Answer:
(d) Customs

Question 8.
________ custom prevails in-a particular locality.
(a) Legal
(b) General
(c) Conventional
(d) Local
Answer:
(d) Local

Question 9.
Custom to be valid must not be:
(a) Immemorial
(b) Uncertain
(c) Reasonable
(d) In confirmation with law and public morality.
Answer:
(b) Uncertain

Question 10.
Rule of Court decision to be followed in future cases is known as ________.
(a) Doctrine of Indoor Management
(b) Doctrine of Stare Decisis
(c) Doctrine of Court Decisis
(d) None of the above.
Answer:
(b) Doctrine of Stare Decisis

Question 11.
In case of any conflict between decisions of co-equal benches ________ decision prevails.
(a) Later
(b) Previous
(c) Both (a) and (b)
(d) None
Answer:
(a) Later

Question 12.
Bench of two judges is known as ________.
(a) Smallest Bench
(b) Full Bench
(c) Division Bench
(d) None of the above
Answer:
(c) Division Bench

Question 13.
Supreme Court is bound by its own decisions.
(a) True
(b) False
(c) Partly True
(d) Partly False
Answer:
(b) False

Question 14.
________ precedents creates law for the whole country.
(a) Declaratory
(b) Pervasive
(c) Absolutely Authoritative
(d) Original
Answer:
(d) Original

Question 15.
Legislation can be:
(a) Supreme
(b) Subordinate
(c) Both (a) and (b)
(d) None
Answer:
(c) Both (a) and (b)

Question 16.
Shruti includes ________ number of Vedas.
(a) 1
(b) 2
(c) 3
(d) 4
Answer:
(d) 4

Question 17.
________ is an unwritten law of England.
(a) Common law
(b) Law Merchant
(c) Equity
(d) Statute
Answer:
(a) Common law

Question 18.
Latin maxim “bonafide” means:
(a) From the beginning
(b) In good faith
(c) Guilty act
(d) In bad faith
Answer:
(b) In good faith

Question 19.
Latin Maxim “in personam” means:
(a) Against specific person
(b) Against no specific person
(c) Amongst other things
(d) Within the powers
Answer:
(a) Against specific person

Question 20.
Hindu and Muhammedan law is ________.
(a) Personal Law
(b) Principle Law
(c) Historical Law
(d) Cus omary Law
Answer:
(a) Personal Law

Question 21.
“A declaratory precedent js one which is merely the application of already existing rule of law.” This was said by:
(a) Ulpine
(b) Cicero
(c) Salmond
(d) None
Answer:
(c) Salmond

Question 22.
Which of the following is the definition of law ________.
(a) Natural
(b) Realistic
(c) Historical
(d) All of these
Answer:
(d) All of these

Question 23.
Who said that “law is the highest reason implanted in nature”
(a) Ulpine
(b) Cicero
(c) Justinian Digest
(d) Salmond
Answer:
(b) Cicero

Question 24.
Who was the prominent modern natural writer who defined law as “the body of principles recognised and applied by the state in the administration justice.”
(a) Salmond
(b) Ulpine
(c) Cicero
(d) None of these
Answer:
(a) Salmond

Question 25.
Which of the following are the main source/sources of mercantile law.
(a) Principles of equity
(b) Common law
(c) Law merchant
(d) All of the above
Answer:
(d) All of the above

Question 26.
________ is the last stage of law making and therefore, the lawyer or the jurist is most important than legislature.
(a) Custom
(b) Social control
(c) Legislation
(d) None of these
Answer:
(c) Legislation

Question 27.
________ is one of the essential of sociological definition of law
(a) Coercive
(b) Legislations
(c) Judicial Process
(d) All of these
Answer:
(a) Coercive

Question 28.
________ refers to some pattern set for guiding the future conduct
(a) Doctrine of Stare Decisis
(b) Precedent
(c) Judicial Precedent
(d) Both (a) and (b)
Answer:
(c) Judicial Precedent

Question 29.
General meaning of source is:-
(a) Origin
(b) Established
(c) Uses
(d) Both (a) and (b)
Answer:
(a) Origin

Question 30.
All norms derives their power from the ultimate norms known as ________.
(a) Normative relation
(b) Ground norms
(c) Legal norms
(d) Physical norms
Answer:
(b) Ground norms

Question 31.
Law administrated by chancellor is known as ________.
(a) Statued law
(b) Equity
(c) Equity courts
(d) All of these
Answer:
(b) Equity

Question 32.
These customs which are non-obligatory and are observed due to the pressure of public opinion is known as ________.
(a) Custom having sanction
(b) Positive Morality
(c) Both (a) and (b)
(d) None of these
Answer:
(b) Positive Morality

Question 33.
Customs that are enforced by state are known as ________.
(a) Customs having sanction
(b) Local customs
(c) General customs
(d) All of these
Answer:
(a) Customs having sanction

Question 34.
This is an essential condition for making a valid custom:
(a) Compulsory observations
(b) Peaceable enjoyment
(c) Certainty
(d) All of these
Answer:
(d) All of these

Question 35.
The term precedent means ________.
(a) Observation
(b) Set pattern for guiding the future conduct
(c) Both (a) and (b)
(d) None of these
Answer:
(d) None of these

Question 36.
Article makes clear that the law declared by the government
shall be binding on all the courts within the territory of India.
(a) Article .171 of the constitution
(b) Article 141 of the constitution
(c) Article 187 of the constitution
(d) All of these
Answer:
(b) Article 141 of the constitution

Question 37.
The underlying principle of judicial decision which is only authoritative is ________.
(a) Doctrine of stare decisis
(b) Ratio decidendi
(c) Obiter dicta
(d) All of these
Answer:
(b) Ratio decidendi

Question 38.
Ratio decidendi is nothing more than decision based on the material facts of the cases defined by ________.
(a) Ulpine
(b) Salmond
(c) Prof. Goodhart
(d) None of these
Answer:
(c) Prof. Goodhart

Question 39.
Which proceeds from the sovereign power in the state or which derives the power directly from the constitution.
(a) Supreme Legislation
(b) Obiter Dicta
(c) Judiciary
(d) All of these
Answer:
(a) Supreme Legislation

Question 40.
Which of the following is not the branch of law ________.
(a) Civil Law
(b) Administrative Law
(c) Commercial Law
(d) None of these
Answer:
(d) None of these

Question 41.
The Latin Maxim “ab initio” means ________.
(a) Frorrr the beginning
(b) To infinity
(c) A new
(d) In law
Answer:
(a) Frorrr the beginning

Question 42.
The Latin Maxim “ad hoc” means ________.
(a) To the same thing
(b) Friend of court
(c) Not intended to be adopted to other purposes
(d) In fact
Answer:
(c) Not intended to be adopted to other purposes

Question 43.
The Latin Maxim “In personam” means ________.
(a) Within the powers
(b) During Litigation
(c) Without day
(d) Against the person
Answer:
(d) Against the person

Question 44.
The Latin Maxim “Mutatis Mutandis” means ________.
(a) With necessary changes
(b) A guilty mind
(c) During litigation
(d) Beyond One’s Power
Answer:
(a) With necessary changes

Question 45.
The Latin Maxim “Ultra Vires” means ________.
(a) Beyond one’s powers
(b) Existing conditions
(c) Without day
(d) Guilty Act
Answer:
(a) Beyond one’s powers

Question 46.
If a case is written as ________.
ONGC Vs HTC, 512 CR 230 (2004)
Then in this case. “512″ refers to
(a) Volume Number
(b) Beginning page
(c) Name of victim
(d) Name of the Reporter
Answer:
(a) Volume Number

Question 47.
If a case citation is stated as Choman Lai V/s Andrew, 511 The “U.S” refers to ________.
(a) Name of the Country
(b) Name of Judge
(c) Name of Victim
(d) Name of the Reporter
Answer:
(d) Name of the Reporter

Question 48.
In a case citation, the term ‘CLJ’ would mean ________.
(a) Company Law Journal
(b) Competent Learned Judge
(c) Corporate Law Jurisdiction
(d) None of the above
Answer:
(a) Company Law Journal

Question 49.
Which one of the following is NOT a major source of Indian Mercantile law?
(a) Judicial Decisions
(b) English Mercantile Law
(c) Customs and Trade Usages
(d) The U.S Federal Forum
Answer:
(d) The U.S Federal Forum

Question 50.
The first attempt to codify and establish uniform principles of mercantile law was done in the year ________.
(a) 1841
(b) 1857
(c) 1932
(d) 1872
Answer:
(d) 1872

Question 51.
The underlying principle of a judicial decision which is only authoritative is termed as ________.
(a) Obiter Dicta
(b) Stare Decisis
(c) Ratio Decidendi
(d) None of the above
Answer:
(c) Ratio Decidendi

Question 52.
The literal meaning of the Latin Expression “Obiter Dicta” is ________.
(a) To the same thing
(b) Hear the other side
(c) Outside of
(d) Said by the way
Answer:
(d) Said by the way

Question 53.
Which of the following statement is not correct in context to the Supreme Court?
(a) It is bound by its own decisions
(b) It’s decisions are binding on all courts in India
(c) It is not bound by the decision of Federal Court
(d) None of the above.
Answer:
(a) It is bound by its own decisions

Question 54.
‘Sir Henry Marine and Savigy’ have given the ________.
(a) Realist Definition of law
(b) Historical definition of law
(c) Sociological Definition of law
(d) All of the above
Answer:
(b) Historical definition of law

Question 55.
‘Holmes and Cardozo’ have given the ________.
(a) Realist Definition of law
(b) Sociological Definition of law
(c) Historical Definition of law
(d) Customary Definition of law
Answer:
(a) Realist Definition of law

Question 56.
Which of the following is NOT a requisite for a valid custom?
(a) Antiquity
(b) Certainty
(c) Consistency
(d) Voluntary Observance
Answer:
(d) Voluntary Observance

Question 57.
Which of the followinq is NOT correct in context to the Hiqh Court in India?
(a) It is the court of Co-ordinate Jurisdiction
(b) Privity council decisions are not
(c) Its decisions are binding on all tribunals within its jurisdiction
(d) All of the above
Answer:
(b) Privity council decisions are not

Question 58.
A Bench of three Judges in a High Court is called as ________.
(a) Smallest Bench
(b) Division Bench
(c) Triangular Bench
(d) Full Bench
Answer:
(d) Full Bench

Question 59.
The Smallest Bench in a High Court consists of how many Judges?
(a) Five
(b) Two
(c) One
(d) None of the above
Answer:
(c) One

Question 60.
A Bench of two judges in High Court is called as ________.
(a) Smallest Bench
(b) Division Bench
(c) Full Bench
(d) None of the above
Answer:
(b) Division Bench

Question 61.
The Hindu Personal law is basically found in ________.
(a) Shruti
(b) Smriti
(c) Both (a) & (b)
(d) None of the above
Answer:
(c) Both (a) & (b)

Question 62.
Which of the following is not a Smriti?
(a) Manu
(b) Yajnavalkya
(c) Narada
(d) Shruti
Answer:
(d) Shruti

Question 63.
Which of the following is NOT a type of precedent?
(a) Persuasive Precedents
(b) Original Precedent
(c) Conditional Authority Precedent
(d) Passive Precedent
Answer:
(d) Passive Precedent

Question 64.
‘The Courts are required to apply the personal law of the parties where the point at issue is not covered by a statutory law or custom”
(a) True
(b) False
(c) Partly False
(d) Partly True
Answer:
(a) True

Question 65.
The guidance or authority of the past decisions of the court are called ________.
(a) Judicial Precedents
(b) Original Precedents
(c) Persuasive Precedents
(d) None of the above
Answer:
(a) Judicial Precedents

Question 66.
Legal customs and conventional customs are a part of ________.
(a) Customs without Sanction
(b) Customs having Sanction
(c) Judicial Customs
(d) Voluntary Customs
Answer:
(b) Customs having Sanction

Question 67.
Which of the following is source of Indian mercantile law?
(a) English Mercantile law
(b) Judicial decisions
(c) Customs and trade usages
(d) All of the above
Answer:
(d) The main source of Indian Mercantile Law are:

English Mercantile Law
Statute Law
Judicial Decision
Customs and Trade Usages

Thus, option (d) is correct answer.

Question 68.
Which kind of precedent from the following creates and applies a new rule of law?
(a) Declaratory
(b) Persuasive
(c) Absolutely authoritative
(d) Original.
Answer:
(d) An original precedent is one which creates and applies a new rule of law. It is a law for the future because it is now applied. Number of original precedents is small but their importance is very great. They alone develop the law of the country and serve as a good evidence of law for the future.

Question 69.
________ means “adhere to the decision and do not unsettle things which are established”.
(a) Stare decisis
(b) Ratio decidendi
(c) Obiter dicta
(d) None of the above.
Answer:
(a) Doctrine of stare decisis refers to the policy of courts to abide by or adhere to principles established by decisions in earlier cases : Thus, stare decisis means “adhere to the decision and do not unsettle things which are established.”

Question 70.
Which of the following is not a source of Indian law?
(a) English mercantile law
(b) Judicial law
(c) Civil law
(d) Customs and trade usage
Answer:
(c) The principal sources of Indian law are:

Customs or Customary Law.
Judicial decisions or precedents
Statutes or legislation.
Personal Law e.g. Hindu & Mohammedan Law.

Hence, Civil Law is not a source of Indian Law.

Question 71.
Which of the following is not a branch of merchant law?
(a) Criminal law
(b) Civil law
(c) Administrative law
(d) English law
Answer:
(d) Branches of Mercantile Law are :

Constitution Law
Administrative Law
Criminal Law
Civil Law
Mercantile / Commercial Law

Thus, option (d) English Law is correct answer.

Question 72.
Law is “essentially & exclusively a social fact” is given under _______
(a) Historical
(b) Sociological
(c) Realist
(d) Positivistic
Answer:
(b) Duguit under Sociological definition of law, defines law as “essentially and exclusively as social fact”.

Question 73.
“Justice is the main guiding ePernent of law” is defined under which school?
(a) Natural
(b) Sociological
(c) Positivistic
(d) Historical
Answer:
(a) Under Natural School of law as per Romans, ‘Justice’ is the main guiding force / element of law.

Question 74.
Decision of one High Court have only a _______ value in a court within the jurisdiction of another High Court.
(a) Voluntary
(b) Mandatory
(c) Persuasive
(d) All of the above
Answer:
(c) High Court’s decisions are binding on all subordinate courts and tribunals within its jurisdiction. Where as, High Court’s decision have a persuasive value in a court which comes under jurisdiction of another court.

Question 75.
The decisions given by Supreme Court are recorded in _______.
(a) AIR
(b) SCC
(c) AIR and SCC
(d) ITR
Answer:
(c) Those decisions which are given by Supreme Court are recorded in SCC (Supreme Court Cases) and AIR (All India Report).

Question 76.
Meaning of intra vires _______.
(a) Within the power
(b) Amongst the other
(c) Beyond the power
(d) None of these
Answer:
(a) The legal Maxim, “intra vires” means within the powers.

Question 77.
Which law is related to the commercial activities of the people of the society?
(a) Constitutional law
(b) Administrative law
(c) Civil law
(d) Mercantile law
Answer:
(d) Mercantile Law or Commercial Law is related to the Commercial activities of people of the society. It is concerned with trade and commerce.

Question 78.
Past decision of the courts for future cases is known as:
(a) Customs
(b) Previous work
(c) Precedents
(d) Historical record
Answer:
(c) The guidance or authority of past decisions of the courts for future cases or only such decisions which lay down some new rule or principle are called judicial precedent.

Question 79.
‘Fait accompli’ means:
(a) Accomplished Act
(b) Accomplished person
(c) Vision to be accomplished
(d) Person accompanying in crime
Answer:
(a) The “fait accompli” is a Latin word which means an accomplished act.

Question 80.
In case of Hindu and Muslim family business, which laws prevail to divide their family properties?
(a) Government law
(b) Their Own laws
(c) Legal laws
(d) None of these
Answer:
(b) Hindus and Mohammedans are governed by their personal law as modified by statute law and custom in all matters relating to inheritance, succession, marriage partition of joint family property pious obligations religions and charitable endowments.

Question 81.
In case name, the first name usually identifies:
(a) The person who is defending the case
(b) The person against whom the action is brought
(c) The person who is bringing the court action
(d) The person who is accused
Answer:
(c) Case Name: There are typically two names for a case. Usually the first name identifies who is bringing the court action and the second name is the person against whom action is being brought.

Question 82.
Custom as a source has a very inferior place in the _______.
(a) Hindu law
(b) Judicial decision
(c) Criminal law
(d) Mohammedan law
Answer:
(d) Customs as a source of law has a very inferior place in Mohammedan law. However, customs which were not expressly disapproved by the prophet were good laws.

Question 83.
What is meant by ‘ab initio’?
(a) From the beginning
(b) From the origin
(c) Both (a) and (b)
(d) None of the above
Answer:
(c) Legal maxim ‘ab initio’ means, from the beginning and from the origin. So, the option (c), i.e. both (a) & (b) is correct.

Question 84.
_______ is the primary source of Hindu law?
(a) Vedas
(b) Holy Quran
(c) Smriti
(d) Both (a) and (c)
Answer:
(d) In the case of Hindus, their personal law is to be found in:

The shruti which includes four vedas.
The ‘Smrities’ which are recollections handed down by the Rishi’s or ancient teachings.

Thus, option (d) is correct.

Question 85.
A is one which is merely the application of an already existing rules of law _______.
(a) Conditionally authoritative precedents
(b) Declaratory precedents
(c) Persuasive precedents
(d) Absolutely Authoritative Precedent.
Answer:
(b) A declaratory precedent is one which is merely the application of an already existing rule of law. It do not create or applies a new rule of law. It is as good a source of law as an original precedent.

Question 86.
“Fait accompli” means:
(a) Accomplished person
(b) Person accompanying in crime
(c) Vision to be accomplished
(d) Accomplished act.
Answer:
(d) “Fait Accompli” means an accomplished act or a thing accomplished and presumably irreversible. This legal maxim is an established principle or proposition.

Question 87.
‘Fait accompli’ means:
(a) Accomplished act
(b) Person accompanying in crime
(c) Accomplished person
(d) Vision to be accomplished
Answer:
(a) Fait accompli means “An Accomplished Act”.

Question 88.
“Law is essentially and exclusively a social fact”, this is the definition of which class of law?
(a) Historical
(b) Sociological
(c) Natural
(d) Positive
Answer:
(b) Duguit under the sociological definition of law defines it as “Essentially and exclusively as social fact”.

Question 89.
Customs are considered as of law _______.
(a) Rules
(b) Source
(c) Principle
(d) Decision
Answer:
(b) Sources means origin. It is divided into 2 parts i.e principal sources and secondary sources. Custom falls under the category of principal sources. It is most ancient of all sources. Smiritis and commentaries are based on customs.

Question 90.
‘De facto’ means:
(a) in fact
(b) a new
(c) old
(d) in law
Answer:
(a) There are numbers of legal maxims which refers to an established principle. Under this the maxim De facto means in fact.

Question 91.
“Law is a part of Dharma”, this is the concept of which school of law?
(a) Positive
(b) Sociological
(c) Natural
(d) Historical.
Answer:
(c) Ancient Hindu view was that law is the common of God and even the ruler is bound to obey it. Thus, law is a part of Dharma. Ancient Hindu view was a part of Natural view.

Question 92.
‘Status quo’ means:
(a) Update the status
(b) Maintains existing status
(c) Change the status
(d) Improve the status
Answer:
(b) ‘Status quo’ means ‘maintaining the existing status’.

Question 93.
What is the meaning of Maxim Ultra Vires?
(a) An accomplished act
(b) Within the powers
(c) Beyond, the power
(d) With the guilty mind.
Answer:
(c) ‘Maxim Ultra Vires’ is Latin phrase which means ‘Beyond the power’.

Question 94.
Which kind of precedent from the following creates and Applies a new rule of law?
(a) Declaratory
(b) Persuasive
(c) Absolutely authoritative
(d) Original
Answer:
(d) Original kind of precedent creates new rule and applies new rule.

Question 95.
According to value is meaning of legal Maxim:
(a) ad hoc
(b) ad idem
(c) ad valorem
(d) de facto
Answer:
(c) Ad valorem means According to value.

Question 96.
Source of Indian Mercantile law?
(a) English Mercantile Law
(b) Customs’and Usage
(c) Judiciary decision
(d) All of the above
Answer:
(d) Source of Indian Mercantile Law

English Mercantile Law
Judiciary Decision
Custom and usage
Acts enacted by Indian legislature; option (d) is correct.

Question 97.
The decision of Supreme Court is recorded as (abbreviation);
(a) AIR, SCC
(b) AIR only
(c) CLJ
(d) LR
Answer:
(a) Abbreviation used to Record;

AIR : All India Reports: Important decisions of Supreme Court
SCC : Supreme Court Cases: Record Indian Supreme Court.

Question 98.
What does the mean of Legal Maxim “Inter AM’ _______.
(a) Among your area
(b) A guilty mind
(c) Among other things
(d) Signifies a right to be heard
Answer:
(c) Inter Alia: Among other things

Question 99.
_______ means “adhere to the decision and do not unsettle things which are established”.
(a) Stare decisis
(b) Ratio Decidendi
(c) Obiter dicta
(d) None of the above
Answer:
(a) Doctrine of stare dicisis refers to the policy of courts to abide by or adhere to principles established by decisions in earlier cases. Thus, stare decisis means adhere to the decision and do not unsettle things which are established.

Question 100.
The meaning of legal maxim ‘Mens rea’ is ________
(a) A pending suit
(b) Immediate profits
(c) During litigation
(d) A guilty mind
Answer:
(d) The meaning of legal maxim, ‘mens rea’ is ‘a guilty mind’.

Question 101.
Highest Court of India ________.
(a) Supreme Court
(b) High Court
(c) Civil Court
(d) District Court
Answer:
(a) Supreme Court is the highest Court of India. Its decisions are binding on all courts within the Territory of India and other Judicial tribunals of the country.

Question 102.
Bonafide means:
(a) A guilty mind
(b) In a good faith
(c) Beyond Once power
(d) Among other things
Answer:
(b) Bonafide means “in good faith”.

Question 103.
________ is the Court whose decisions are binding on all courts and other judicial tribunals
(a) High Court
(b) Supreme Court
(c) Indian Penal Court
(d) None of the above.
Answer:
(a) Article 141 of the Constitution makes it clear that the law declared by Supreme Court shall be binding on all the courts with in the territory of India. The Supreme Court being the highest court binds all judicial tribunals and courts by its decisions.

Question 104.
Hindu and Mohammedan law is ________.
(a) Personal Law
(b) Customary Law
(c) Precedents
(d) Statutes
Answer:
(a) The courts are required to apply personal law of the parties where the point at issue is not covered by any statutory law or custom. Hindus are governed by their personal law in matters relating to inheritance, succession, marriage, etc. and Mohammedans are governed by their personal law in matters relating to wills, succession, legacies, etc.

Question 105.
‘Mens rea’ meaning?
(a) A Guilty Act
(b) A Guilty mind
(c) Important person
(d) Pending suit
Answer:
(b) The meaning of ‘mens rea’ is ‘Guilty mind’.

Question 106.
Law is a Part of “Dharma” ________.
(a) National school
(b) Realistic school
(c) Historical school
(d) All of Above.
Answer:
(a) According to Natural School of law, ancient Hindus view was that ‘law’ is the command of God and not of any political sovereign. Everybody including the ruler, is bound to obey it. Thus, law is a part of ‘Dharma’.

Question 107.
Find the odd one out:
(a) Manu
(b) Yojnavalkya
(c) Shruti
(d) Narada
Answer:
(c) According to the personal law, in case of Hindus, their personal law is found to be in:

The Shruti which includes four Vedas.
The ‘Smritis’ which are recollections handed down by Rishi’s or ancient teachings and percepts of God.
There are three main Smritis:

Codes of Manu, Yojnavalkya and Narada.

Question 108.
Who is the Supreme Commander of Indian Armed forces:
(a) Major
(b) President
(c) Lieutenant
(d) Both ‘A’ and ‘C’
Answer:
(b) The President of India is the Head of State and Supreme Commander of Indian Armed forces while the people elected Prime Minister act as a Chief Executive and is responsible for running the government.

Introduction to Law – CS Foundation Business Law Notes

Introduction to Law – CS Foundation Business Law Notes

CS Foundation Business Environment and Law Notes