UGC NET Commerce Legal Aspects of Business Syllabus

Legal Aspects of Business syllabus — full chapter and topic list

Expand any chapter to see its topics and sub-topics. This is the whole examinable outline for Legal Aspects of Business in UGC NET Commerce, not a summary of it.

1. 1

   Indian Contract Act, 1872

   6 topics

   • Elements of a valid contract
   • Capacity of parties
   • Free consent
   • Discharge of a contract
   • Breach of contract and remedies against breach
   • Quasi contracts
2. 2

   Special contracts

   3 topics

   • Contracts of indemnity and guarantee
   • Contracts of bailment and pledge
   • Contracts of agency
3. 3

   Sale of Goods Act, 1930

   3 topics

   • Sale and agreement to sell
   • Doctrine of Caveat Emptor
   • Rights of unpaid seller and rights of buyer
4. 4

   Negotiable Instruments Act, 1881

   3 topics

   • Types of negotiable instruments
   • Negotiation and assignment
   • Dishonour and discharge of negotiable instruments
5. 5

   The Companies Act, 2013

   3 topics

   • Nature and kinds of companies
   • Company formation
   • Management, meetings and winding up of a joint stock company
6. 6

   Limited Liability Partnership

   1 topic

   • Structure and procedure of formation of LLP in India
7. 7

   The Competition Act, 2002

   1 topic

   • Objectives and main provisions
8. 8

   The Information Technology Act, 2000

   2 topics

   • Objectives and main provisions
   • Cyber crimes and penalties
9. 9

   The RTI Act, 2005

   1 topic

   • Objectives and main provisions
10. 10

    Intellectual Property Rights (IPRs)

    2 topics

    • Patents, trademarks and copyrights
    • Emerging issues in intellectual property
11. 11

    Goods and Services Tax (GST)

    4 topics

    • Objectives and main provisions
    • Benefits of GST
    • Implementation mechanism
    • Working of dual GST

Legal Aspects of Business flashcards for UGC NET Commerce

21 of 69 cards from the Legal Aspects of Business deck — real questions with worked answers.

1. What are the essential elements of a valid contract under the Indian Contract Act, 1872?

   Offer and acceptance, intention to create legal relations, lawful consideration, capacity of parties, free consent, lawful object, certainty of meaning, possibility of performance, and not expressly declared void.

2. Under Section 2(h) of the Indian Contract Act, how is a 'contract' defined?

   A contract is an agreement enforceable by law. (Contract = Agreement + Enforceability by law.)

3. Distinguish between a void agreement and a voidable contract.

   A void agreement is not enforceable by law from the beginning (Sec 2(g)). A voidable contract is enforceable at the option of one aggrieved party but not the other (Sec 2(i)), e.g., consent obtained by coercion or fraud.

4. Who are the persons competent to contract under Section 11 of the Indian Contract Act?

   A person who (1) is of the age of majority, (2) is of sound mind, and (3) is not disqualified from contracting by any law to which he is subject.

5. What is the legal status of an agreement made by a minor in India?

   An agreement with a minor is void ab initio (from the beginning), as held in Mohori Bibee v. Dharmodas Ghose. A minor cannot be a promisor but can be a promisee/beneficiary.

6. Define 'free consent' under Section 14 of the Indian Contract Act.

   Consent is free when it is not caused by coercion, undue influence, fraud, misrepresentation, or mistake. Consent means agreeing upon the same thing in the same sense (consensus ad idem).

7. Differentiate between coercion and undue influence.

   Coercion (Sec 15) is committing/threatening an act forbidden by IPC or unlawful detaining of property to obtain consent — physical force. Undue influence (Sec 16) is dominating the will of another due to a position of relationship — mental/moral pressure.

8. Distinguish between fraud and misrepresentation under the Contract Act.

   Fraud (Sec 17) is a false statement made knowingly or without belief in its truth, with intent to deceive. Misrepresentation (Sec 18) is an innocent/honest false statement believed to be true. Both make a contract voidable, but only fraud generally allows a claim for damages.

9. What are the various modes of discharge of a contract?

   By performance, by mutual agreement (novation, rescission, alteration, remission, waiver), by impossibility/frustration, by lapse of time, by operation of law, and by breach.

10. What is novation of a contract?

    Novation (Sec 62) is the substitution of a new contract for an existing one — either between the same parties or with new parties — thereby discharging the original contract.

11. What is the doctrine of frustration / supervening impossibility under Section 56?

    When performance of a contract becomes impossible or unlawful after formation due to an event beyond the parties' control, the contract becomes void and the parties are discharged.

12. What is meant by 'anticipatory breach' of contract?

    Anticipatory breach occurs when a party declares (expressly or by conduct) his intention not to perform the contract before the due date of performance, entitling the other party to sue immediately or wait.

13. List the remedies available to an aggrieved party on breach of contract.

    Rescission of the contract, suit for damages, suit for specific performance, suit for injunction, and suit for quantum meruit.

14. State the rule of damages laid down in Hadley v. Baxendale.

    Damages recoverable are those arising naturally from the breach (ordinary damages) and those reasonably in the contemplation of both parties at the time of contract (special damages). Remote/indirect losses are not recoverable.

15. Differentiate between liquidated damages and a penalty.

    Liquidated damages are a genuine pre-estimate of loss agreed upon by parties. A penalty is a sum fixed to coerce performance. Under Section 74, Indian courts award only reasonable compensation not exceeding the named sum, regardless of label.

16. What is a quasi-contract?

    A quasi-contract is an obligation imposed by law (not by agreement) to prevent unjust enrichment, treating parties as if a contract existed. It rests on the principle 'no one should enrich himself at another's expense.'

17. Name the types of quasi-contracts covered under Sections 68-72 of the Contract Act.

    Supply of necessaries to incompetent persons (68), payment by an interested person (69), benefit of a non-gratuitous act (70), responsibility of a finder of goods (71), and liability for money/things received by mistake or coercion (72).

18. Define a 'contract of indemnity' under Section 124.

    A contract by which one party (indemnifier) promises to save the other (indemnity-holder) from loss caused by the conduct of the promisor himself or of any other person.

19. Define a 'contract of guarantee' and name its three parties.

    A contract to perform the promise or discharge the liability of a third person in case of his default (Sec 126). The three parties are: principal debtor, creditor, and surety.

20. Distinguish between a contract of indemnity and a contract of guarantee.

    Indemnity has two parties and one contract to make good a loss; liability is primary and contingent. Guarantee has three parties and three contracts; the surety's liability is secondary and depends on the principal debtor's default.

21. What is meant by 'co-extensive liability of a surety'?

    Under Section 128, the surety's liability is co-extensive with that of the principal debtor — i.e., the surety is liable for the same amount/extent as the principal debtor, unless the contract provides otherwise.

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