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CA Foundation
Business Laws
Mock Test Paper
Date: 17 May 2020
Time Allowed: 2 Hours Total Marks: 60
Strict Instructions Otherwise, your paper will not be checked.
1. Write your Name, Registered email Id, Phone number and State at the top of the answer
sheet before starting the paper.
2. UPLOADING THE ANSWER SHEET:
 Take images of answer sheet in VERTICAL FORM (not horizontal).
 Make PDF of all images in sequence using the App CAM SCANNER or any other
App.
 Upload it before time.
 Be HIGHLY careful while uploading the answer sheet. Once you wrongly uploaded
the answer sheet, you will not be able to rectify it.
3. Answer sheet should be uploaded before time. If it uploaded after 6pm, then it will not be
evaluated.
4. QUESTION NO.1 is Compulsory. Answer any FOUR questions from the remaining FIVE
question.
Q. No. Marks
1
a) X, Y and Z are partners in a firm. They jointly promised to pay ₹3,00,000 to D. 4
Y become insolvent, and his private assets are sufficient to pay 1/5 of his
share of debts. X is compelled to pay the whole amount to D. Examining the
provisions of the Indian Contract Act, 1872, decide the extent to which X can
recover the amount from Z.
b) Ravi Private Limited has borrowed ₹5 crores from Mudra Finance Ltd. This 4
debt is ultra vires to the company. Examine whether the company is liable to
pay this debt? State the remedy if any available to Mudra Finance Ltd.?
c) What is meant by delivery of goods under the Sale of Goods Act, 1930? State 4
various modes of delivery.
2
a) State the exceptions to the rule "An agreement without consideration is void". 5
b) What are the essential elements to form an LLP in India as per the LLP Act, 5
2008?
c) Examine with the reason that the given statement is correct or incorrect 2
"Minor is liable to pay for the necessaries supplied to him".
3

a) Distinguish between the dissolution of the firm and dissolution of the 2

partnership. (Any two points)
b) What are the consequences of Non-Registration of a Partnership Firm? 4
Discuss.
c) Prabhat agrees to sell 1,000 pair of shoes to Mohit. Mohit told Prabhat that he 6
would take 200 pair of shoes on 20th May 2020 from his warehouse and the
rest 400 on 26th May 2020. Mohit took 200 pair of shoes on 22nd May 2020. Till
then, out of 200, 50 pair of shoes were damaged by rats. Rest 400 pair of shoes
was at Prabhat’s warehouse. Due to an unfortunate fire accident, all 400 pair of
shoes were damaged. Discuss which party will bear the damages and why?
Also, provide the damage amount which the party will bear. (Additional
information: 1 shoe = ₹250 and Mohit already paid an advance for first 200
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shoes).
4
a) What is the appropriation of goods under the Sale of Goods Act, 1930? State 6
the essentials regarding appropriation of unascertained goods.
b) X, Y and Z are partners in a Partnership Firm. They were carrying their 6
business successfully for the past several years. Spouses of X and Y fought in
ladies club on their personal issue, and X's wife was hurt badly. X got angry
on the incident, and he convinced Z to expel Y from their partnership firm. Y
was expelled from the partnership without any notice from X and Z.
Considering the provisions of the Indian Partnership Act, 1932, state whether
they can expel a partner from the firm. What are the criteria for the test of
good faith in such circumstances?
5
a) Mr D sold some goods to Mr E for ₹5,00,000 on 15 days credit. Mr D delivered 6
the goods. On the due date, Mr E refused to pay for it. State the position and
rights of Mr D as per the Sale of Goods Act, 1930.
b) Define OPC (One Person Company) and state the rules regarding its 6
membership. Can it be converted into a non-profit company under Section 8
or a private company?
6
a) Define Fraud. Whether "mere silence will amount to fraud" as per the Indian 5
Contract Act, 1872?
b) What is the conclusive evidence of partnership? State the circumstances 4
when a partnership is not considered between two or more parties.
c) State the limitations of the doctrine of indoor management under the 3
Companies Act, 2013.

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