CS Module-II QnPapers Dec09

8/14/2019 CS Module-II QnPapers Dec09

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264noU No..T i m e a l l o w e d : S h o u r sTotal number of questions : B

Maximum marlzs.:100Total number of printed pages : 4

NOTE : 7. Answer SIX questions ncluding Question No.I which is compulsory.2. All referenceso sections elate to the CompaniesAct, 1956unlessstated otherwise.

1. Attempt any four of the following :(i ) "Some definite criteria will have to be fulfilled to identify a corporation as Statewithin the meaning of Article L2 of the Constitution of India." Comment.(ii) "Diminution of share capital is not always regardedas reduction of capital." Comment.(iii) "A limited company will have to get certain resolutionspassedonly through postalballot instead of transacting the business n the general meeting of the company."Discuss.(iv) "Oppressionnged not be continuous." Discuss.(v) "Common seal of a companywill have to be affixed on all the letters and documentsof the company." Discuss.' (S marks each)

2. (a) Choose the most appropriate answer from the given options in respect of the. following :(i) Out of the following statements,which one s correctwith regard to listing ofsecurities -

(a ) The shares and debenturesof a public companymay be quoted on a stockexchangeft ) The shares and debentures of a private company may be quoted on astock exchange(c) Only the shares and not the debentures of a public company may bequoted on a stock exchange(d) Only the shares and not the debentures of a private company may bequoted on a stock exchange.

(ii) Sweat equity shares issued to employeesor directors of a company shall belocked-in for a period of -Iu) Three years from the date of allotment(b) Two years from the date of allotment(c) Five years from the date of allotment(d) Twelve months from the date of allotment.

P. T. O./200e/cl (NS)

Module-II : Company Law


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264 : 2 :(iii) The companieswhich need not have their own articles of associationare

(a) Unlimited companies(b) Companies limited by guarantee(c) Private companies imited by shares(d) Public companies imited by shares.

(iv) According to the SEBI Guidelines, he issue of bonus shares should be madewithin a period of -(a) Three months from the date of approval of the Board of directorsft) Six months from the date of approval of the Board of directors(c) Twelve months from the date of approval of the Board of directors(d) Thirty days from the date of approval of the Board of directors.

(v) Out of the following statements, which one is incorrect as regard to theDirector Identification Number (DIN) -(a) DIN is a unique identifrcation number and onceobtained is valid throughoutthe lifetime of a director(b) DIN is mandatory for all directorsof Indian companieswhether they arecitizens of India or not(c) DIN is mandatory for directors of foreign companyhaving branch officesin India(d) A single DIN is required for an individual irrespective of number of "directorships held by him.

( marlz each)(b) Re-write the following sentencesafter filling-in the blank spaceswith appropriateword(s)/figure(s) :(i ) In caseof listed companies,where the shares are transferable hrough electronicmod.e, ransfers are made through - instead of physical transfers.

(ii) The voting power of a guarantee companyhaving share capital is determinedby the and not bY the guarantee.(iii) is the total of the called-up capital remaining unpaid.(iv) No person shall hold office at the same time as small shareholders'director

in more than companies.(v) includesa reorganisationof sharecapital of companyby consolidationof shares of different classes or division of shares into shares of differentclassesor bv both these methods. (1 marlz eaclt)(c ) Statb the salient features of a 'limited liability partnership' (LLP). (6 marles)

2t200e/cl,NS) Contd...


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3 .

: 3 :

Distinguish between any four of the following :(i) 'Reservecapital' and 'capital reserve'.

(ii) 'Sweat equity' and 'issue of capital on preferential basis'(i i i) 'ESOS' and 'ESPS'.(iv) 'Motion' and 'resolution'.(v) 'Shelf prospectus'and 'red-herring prospectus'.

Define 'prospectus'. What are the ingredients to constitute a

(b) What are the documents required to be attached with theprospectus o be filed with the Registrar of Companies?

(c) Registrar of Companies can refuse registration of prospectus.

264

(4 marks each)prospectus?

(6 marks)draft red-herring

(6 marks)ExpIain.

(4 marks)

4. (a)

5 . (a) State, with reasons n brief, whether the following statementsare corrector incorrect(i) A compdfry,being a body corporate,can sue and be sued in its own name.

(ii) A government company s neither a government department nor a governmentestablishment.(iii) Under section t4, ttre memorandum of associationof a company may be inany form.

(iv) A director is liable for acts of his co-directors.(v) Every shareholder has the right of nomination of shares.

(2 marks each)(b) Tuff Ltd. is a public limited company, which was registered in the year 1991

under the Companies Act, 1956. After eighteen years of existence as a publiccompany, the said company now wants to convert itself into a private limitedcompany. Is it possible? If yes, explain the legal requirements, if any.

G marks)6. (a) The power to invest funds of the company is the prerogative of the Board of

directors under section 292. Discuss he limitations on such powersof the Board,if any, relating to inter-corporate oans and investments under section 3724.(6 marks)

P.T. O.t2009tcl NS)


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264 i 4 :With the approval of the Board, an amount of Rs.50crore was spent by SpeedJetLtd., in producing a commercial film, not coveredunder its objectsclause. Thefilm was a complete lop and the company ost an amount of Rs.40 crore. Someof the members of the company objected to such investments not covered by theobjects clause of the company. They filed a suit in the court of law making thed.irectorspersonally responsible and to make good the loss. Will they succeed?Support your answer with reasons rc marks)What is meant by 'doctrine of ultra uires' ? (4 marh.s)

7 (a) what do you understand by 'transmission of shares' ? (2 marks)(b) Fortune Ltd. refused to enter the name of the minor son of a deceasedmember inthe register of members on the ground that the minor cannot enter into a contractas per section 11 of the Indian Contract Act, L872. The shares are fully paid-up.Comment on the decision of the company and suggestremedies available.(4 marks)(c) Piyush Ltd. decided to buy-back its shares with the approval of the Board ofd.irectors. As the Company Secretary of the company, advise the Board about theconditions and limitations in this regard. (70 marks)"

businessof(4 marks)

ft ) Can a listed company change ts name as and when ' :essary? Give reasons nsupport of your answer. (4 marks)Grace Ltd., a public limited company has'received an application from Rosy fortransmission of certain shares n her name. Rosy,being a widow of a shareholder,applies for transmission of the sharesstanding in the name of her deceased usbandwilhout producing a successioncertificate. Can the company transfer the sharesof the deceasedmember'? Discuss. (4 marlzs)Vayu Ltd. holds more than 50Voof nominal value of the equity capital of StreamLtd. In these circumstances,Stream Ltd. wants to becbmea member of Vayu Ltd.Can Stream Ltd. do so ? Discuss he rights of the said subsidiary in such a case.(4 marks)

(b)

(c)

8 . (a) Can a company registered under the CompaniesAct, 1956 commencebanking in India ? Discuss.

(c)

(d)

2/2009/CLNS)-o-


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265Maximum marks : 100

number of questions 8 Total number of printed pages : 6PART_A

(Answer Question No.L which is compulsoryand any three of the rest from this part.). With reference o the relevant legal enactments,write short notes on any fiae of thefollowing :

(i) Export Promotion Council(ii) Combinations(iii) Advance authorisation scheme(iv) Calibration(v) Environmental audit

(vi) Tr-ade effluent(vii) Commercial Pur'ose

(3 marks each)State, with reasons n brief, whether the following statements are true or false. Attemptany ftae :

(i) A person can export or import without an importer-exporter code(IEC) number.(ii) The manufacture of a non-standard weight or measure is prohibited. under theStandards of Weights and Measures Act, 1976.

(iii) A reasonable opportunity of being heard must be afforded to a person beforeordering confiscationof an essential commodityunder the Essential CommoditiesAct, 1955.(iv) Trade practice includes a single or isolated action of any person in relation to anytrade.

(v) The Competition Act, 2002doesnot prohibit dominance,but the abuseof dominantposition.(vi) A trade mark may not distinguish the goodsof one manufacturer or trader fromsimilar goods of other manufacturers or traders

" (3 marks each)(NS) P. T. O.

Economic and Labour Laws


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265 : 2 :3. (a) Distinguish between any two of the following :

(i) 'Certifrcation trade marks' and lcollective rade marks'.(ii) 'Duty free replenishment certificate'and 'duty entitlement passbookscheme

(iii) 'Provisional specification'and 'completespecification'under the Patents Act,1970.(5 marks each

(b) Re-write the following sentencesafter filling-in the blank spaceswith appropriateword(s)/figure(s)(i) The ConsumerDisputes RedressalForum shall not admit a complaint unlessit is frled withinaction has arisen. vears from the date on which the cause of

(ii) Indian parties are prohibited from making investment in a foreign entityengaged in

(iii) The company which has exported goods s required to realise the full valueof goodswithin days.(iv) For setting-up an EOU, three copiesof the application n the prescribed ormmav be submitted to the(v)#:H*:frilih:;1$:'J^'"':,:",T_H

(1 mark each4. (a) With reference o the relevant provisions of the Foreign Exchange N{anagemenAct, 1999 and the rules and regulations made thereunder, advise on the following

(i ) Naresh, an Indian citizen, is interested in sending Rs.10,000 o his sisteresiding in USA as birthday gift.(ii) A person resident outside India desires o contribute Rs.10 akh as capital ina firm engaged n software business in India.

(iii) An Indian company intends to open a foreign currency account in India aswell as outside India.(iv) A company incorporated n USA desires o establish its manufacturing unitin special economiczone n India.(v) Dinesh, an Indian citizen,wants to usehis international debit card for withdrawalof cash during his visit abroad. (1 mark each

(b) Enumerate the heads under which compensation or damages may be claimedfrom the National Environment Tribunal constituted under the National EnvironmenTribunal Act. 1995.

2t200e/ELLNS)(5 marks)

Contd..


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: 3 : 265(c) Do the following acts constitute infringement of copyright under the CopyrightAct, Lg57 :

(i ) Making or publishing of a painting, drawing, engraving or photograph of awork of architecture.(ii) Reproductionof a literary, dramatic, musical or artistic work in the form ofa cinematograph film.

(iii) Reconstructionof a building or structure in accordancewith thedrawings or plans by reference o which the buildine or structureconstructed.(iv) Making of any sound recording or visual recording for the private use of thepersonmaking such recording,or solely or the purpose of bona id,e eachingor research.(v) Making translation of a literary work

(1 marle each)(a) Raman purchaseda car by taking a loan from a bank and gavepost-datedchequesto the bank not only in respectof repayment of loan instalments but also towardspremium of insurance policy for succeeding3 years. On the expiry of the policyin the first year, the bank failed to get the policy renewed for the secondyear. Inthe meantime, the car met with an accident. Raman brought an action againstthe bank for 'deficiencyin service'under the ConsumerProtectionAct, 1986. Will

he succeed? (5 marks)(b) what is the objective of 'know your customer' (Kyc) guidelines ? when do theKYC guidelines apply ?(5 marks)(c) Mention the provisionsof the EssentialCommoditiesAct, 1g5b egarding confiscationof essential commoditiesseized n contravention of section3 of the Act.(5 marlzs)

PART-B(Answer ANY TWO questions from this part.)Write notes on any four of the following :(i) 'Conceptof continuous service or the payment of gratuity' underGratuity Act, t972. the Pavment of(ii) 'Manner of fixation and revision of minimum wages' und.er the Minimum WagesAct, 1948.

architecturalwas originally

5 .

6 .

|2009/ELL NS) P. T. O.


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265 : 4 :(iii) 'Authorities for the investigation and settlement of industrial disputes' under theIndustrial Disputes Act, L947(iv) 'Hazardous process'under the Factories Act, 1948.(v) 'Benefits to which insured personsare entitled'under the Employees'State InsuranceAct, 1948.

(vi) 'Payment of subsistenceallowance'under the Industrial Employment (StandingOrders) Act, 1946. (5 marlzs each)7 (a) Distinguish between any two of the following :(i)

"}%Tllffff:i: i|fr?tuity'andtotalforfeiturefgratuity' nderhePayment

(ii) 'Model standin^gorders' gnd'certified

standing orders' und.er he IndustrialEmployment (Standing Orders) Act, L946.( i rff '+nffi'Ji "f"Xi"J"T;fi #ffi:T;; g ntheco r eo emp m ' un e(5 marks each)(b) Re-write the following sentencesafter filling-in the blank spaceswith appropriateword(s)/figure(s) :, (i) Bonus must be paid to employeeswithin a period ofthe closeof the accountingyear.

(ii) means termination of the services of a workman by the employerfor any reason whatsoever, otherwise than as a punishment inflicted by wayof disciplinary action.

(iii) A minimum of contributory service s required for entitlement topensionunder the Employees'Provident Funds and MiscellaneousProvisionsAct, L952.(iv) The employer is not liable for compensationwhen injury to the workman doesnot result in disablement for a period exceeding days.(v) The employer s required to send a report to the Commissioner or workmen'scompensation withinworkman. days of the death or serious injury of the

(1 marlz each)(c) Choose the most appropriate answer from the given options in respect of thefollowing :(i ) The 'occupier' of a factory is required to appoint a Welfare Officer where

(a) 250 workers are employed(b) 100 workers are employed(c) 200 workers are employed(d) 500 or more workers are employed.

months from

2/200enLL(NS) Contd...


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: 5 : 265(ii) out of the following which is not a manufacturing process_(a) Finished goodsand packing thereof(b) The making of bid,is(c) stitching old gunny bags and making thern fi t for use(d) Pumping of water from a tubewell.(iii) From the date on which the Industrial Employment (standing orders) Act,1946becomes pplicable o an industrial establisirme_nt,n employer s requiredto submit to the Certifying Officer the draft standing ord"r, -' -(a) Within B months

ft) Within 6 months(c) Within a month(d) Immediately on receipt.(iv) The Contract Labour (Regulationestablishment wherein workmen12 months are -

and Abolition) Act, lg70 applies to everyemployed on any duy of -the preceding(a) 100 or moreft) 50 or more(c ) 20 or more(d) 200 or more.(v) The maximum amount of gratuity payable under the payment of GratuityAct, 1972 is -(a) Rs.5,00,000ft) Rs.3,50,000(c) Rs.2,50,000(d) Rs.2,00,000.

(1 mark each)8' Attempt any fiae of the following stating relevant legal provisions and decidedcaseaw, if any :

succeed?(ii) Raju h_as een employed by Fancy Batwice during the day. The provident' raised objections for non:inclusion ofprovident fund contributions. Is theNS) P.T. O.


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265 : 6 :(iii) Designers-L-td. is engaged in fabrication work oi window grills with the aid ofpower and has employed 19 workers. Recently, it appoiited 2 gard,eners orgardening in its factory premises. Is the.o-puny liableio extend #;U"""nt, tothe gardeners as applicabre to other factory workers ?(iv) The workmen went on sympathetic strike by absenting themselves from work insupport of the workmen belonging to some other "-ploy"r. The managementintends to take disciplin ary action against those workmtn. Is the intention of themanagement justifred and legal ?(v) Efficiency Ltd. is in the processof reorganising ts business. It is likely to resultin some abour being ,"th"r"d surplus. It has roposed retrenchment of economicdead weight. Can the company do so ?(vi) ..ltrrtal, a railways employee was orderrpipeline there. After finishing the wo:when he slipped and fell and died as apay compensation under the Workmer(vii) An employee was dismissed from service for an act of misconduct. The companyd-idnot pay any bonus to the dismissed employee or the accounting year in whichthe dismissal took place. Is the action of tnl company ustified ?

(4 marks each)

(NS)


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266RolI No..T i m e a l l o w e d : S h o u r s Maximum marks : 100Total number of questions 8 Total number of printed.pages : 4

PAR,T-A(Answer Question No.I which is compulsoryand any three of the rest from this part.)

1. (a) State, with reasons n brief, whether the following statements are true or false:(i ) Cumulative convertible preference shares are not hybrid instruments.

(ii) Equity linked saving schemes have lock-in-period of five years.(iii) A depository is an organisation like Reserve Bank of India.(iv) In basket trading system, investor buys or sells al l the fifty scrips in one go.(v) Hedge funds employ their funds for speculative trading.

(2 marks each)(b) Re-write the following sentencesafter filling-in the blank spaceswith appropriateword(s)/figure(s) :

(i ) Direct and indirect control of virtually al l aspects of securities trading isprovided by(ii) Tracking stock is a type of common stock that 'tracks' depending on

(iii) CAMEL model encompasses(iv) As per SEBI regulations, capital adequacyrequirement for merchant bankershall be a net-worth of not less than Rs._-.(v) -are imposed on the scrip which witness abnormal price/volumemovements.

' (t marle each)2. (a) Write short notes on the following :

(i ) Corporate restructuring(ii) Trade to trade

(iii) Margin trading(iv) Securities Appellate Tribunal.

(2 marlzs each)(NS) P. T. O.

Securities Laws and Compliances


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266 i 2 i(b) Expand the following abbreviations:(i) DVP

(ii) EDIFAR(iii) oMo. (7 mark each)(c) What are the 'real estate mutual fund'schemes ? Explain their features.(4 marks)3. (a) Explain an! tuo of the following terms ih relation to securities reforms anddevelopments in our country :

(i ) Corporate governance(ii) Financial disclosures(iii) Rolling settlement.

ft) Write a note on 'treasury bills'.(c) Explain briefly the following :

(i ) BOLT(ii) NEAT.

(3 marks each)(5 marks)

4. (a) Distinguish between any two of the following :(i) 'Naked debentures' and 'secured debentures'.

(ii) 'Industrial revenue bonds' and 'commodity bonds'.(iii) 'Indexed rate notes' and 'extendable notes'.

(2 marlzs each)

(3 marks each)ft) Describe briefly the risks involved in mutual funds. , (4 marles)(c) What do you mean by 'dematerialisation of securities' ? State its benefits.

5. (a) Discuss the various functions of 'price monitoring'.(5 marks)

(5 rnaiks)(b) State the proCedureor buy-back of securities hrough stock exchange.n(S marks)(c) Discuss he norms for registration of portfolio managerswith the Securities andExchange Board of India (SEBI).2/2009/SLC(NS)

(5 marks)Contd...


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: 3 : 266

(5 marks)of Fraudulent and Unfair1995 related to -

PART-B(Answer ANY TWO questionsfrom this part.)

6' (a) Explain the meaning of any two of the following in the context of internationalcapital market :(i) Domestic custodian bank

(ii) Global depository receipts.(iii) Overseasdepository bank.

(3 marks each)ft ) What are the conditions for 'voluntary delisting of securities, ?(4 marks)(c) "In issuance of GDRs/FCCBs, pre-marketing exercise s a tool through which thesyndicate members evaluate the prospectsof the issue." Comment.(5 marks)(d ) Who can access external commercialborrowings' (ECBs) under automatic routeas per Reserve Bank of India ?

(a) Discuss briefly the provisions of the SEBI (ProhibitionPractices Relating to Securities Market) Regulations,(i ) Misleading statements;

(ii) Market manipulations;(iii) Dealings in securities; and(iv). p"ohibition on certain dearings in securities.

Attempt any four of the following :(i ) "PAN has to be the sole identifier number formarket." Comment.

(10 marks)ft ) What are the common grievances of investors in India ? State the authoritieswhich can be approached by an investor for redressal of these grievances.

(10 marks)

al l transactions in the securities(5 marks)

P. T. O./200e/sLCNS)


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266 : 4 :(ii) State the activities stipulated under the Investor Education and Protection Fund(Awarenessand Protection of Investors) Rules, 2001.

(5 marlzs)(iii) Explain.the regulatory framework of debt market in India. (5 marks)(iv) What is the lock-in-period requirement for promoters' contribution ? (5 marlzs)(v) What are the rights of securities-holders in case of compulsory delisting ofsecurities ? (5 marh,s)

-o-

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CS Module-II QnPapers Dec09