DAMO DAMODARAM SANJIVAYYA NATIONAL LAW UNIVERSITY
VISAKHAPATNAM
SEMESTER-III End – Semester Repeat Examinations, July -2024
Specific Contracts (Contracts-II) (3-6)
Instructions:
1. Answer all questions.
2. Any overwriting in answering question No. I will invalidate the relevant answer.
3. Do not write anything on the question paper. It will be treated as malpractice.
Total Marks - 50
Time: 2½ Hours
I. Choose the correct answer from the following MCQ’s (20 x 0.5 marks = 10 marks)
1. A contract by which one party promises to save the other from loss caused to him by the
conduct of the promisor himself, or by the conduct of any other person, is called
____________
A. Contract of Guarantee
B. Contract of surety
C. Contract of Indemnity
D. Contract of Agency
2. General duties of partners are stated in the provision_________
A. Section 7
B. Section 8
C. Section 9
D. Section 10
3. Can an illegal partnership be taxed?
A. Yes, it is certainly bound to be taxed as an unregistered partnership firm.
B. Yes, it is certainly bound to be taxed either as an association of persons or partnership
firm.
C. No, it cannot be taxed as the partnership is illegal.
D. Either A or B
4. In the Larsen and Toubro Limited and Another (2014) 1 SCC 708 case the senior counsel
__________argued the case.
A. Fali S. Nariman
B. Rohinton F. Nariman
C. Harish Salve
D. Kapil Sibal
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5. Sale by description stated under ___________provision.
A. Section 17 of the Sale of Goods Act, 1930
B. Section 16 of the Sale of Goods Act, 1930
C. Section 15 of the Sale of Goods Act, 1930
D. Section 14 of the Sale of Goods Act, 1930
6. As per section 25 of the Indian Contract Act, 1872 agreement without consideration is a void
agreement and in the case of guarantee how the consideration may be offered:
A. Anything done for the benefit of the principal debtor.
B. Any promise made for the benefit of the principal debtor.
C. Some amount should be offered to the principal debtor.
D. Either A or B
7. Under ___________provision it was stated that Electricity is capable of abstraction,
consumption and use which, if done dishonestly, would attract punishment.
A. Section 39 of the Indian Electricity Act, 1910
B. Section 38 of the Indian Electricity Act, 1910
C. Section 37 of the Indian Electricity Act, 1910
D. Section 36 of the Indian Electricity Act, 1930
8. When a contract is made in one country, but it is to be performed in another, generally which
country the law will be applied to enforced _____________
A. Law of the place where it is executed.
B. Law of the place where it is to be performed.
C. Law of the place where the international court is existing.
D. Law of the place where the contract is entered.
9. “Their gain”, it was added “is not only by uttering of their commodities, but for the
attendance of their servants, and for the furniture of their house, rooms, and lodgings, for
their guests…” the observation was made in the case of ___________.
A. Crisp v. Pratt
B. Newton v. Tries
C. Crisp v. Tries
D. Newton v. Crisp
10. ___________is the consequence of changing the terms of the contract between the principal
debtor and the creditor.
A. Discharge of surety by variance in terms of the contract.
B. Discharge of principal debtor by variance in terms of contract.
C. Discharge of creditor by variance in terms of contract.
D. Discharge of indemnified holder by variance in terms of contract.
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11. Release of co-surety does not discharge other stated under ______________of the Indian
Contract Act, 1872.
A. Section 136
B. Section 137
C. Section 138
D. Section 139
12. In __________case, it was held that artificially created light energy carrying data through
optic fiber cable is distinct from electromagnetic waves and falls within the definition of
goods.
A. Reliance Jio v. Union of India
B. Vodafone v. Union of India
C. Bharti Airtel v. Union of India
D. Bharat Sanchar Nigam Ltd. v. Union of India
13. Which of the following are false statements:
a. Partners are not bound to carry on the business of the firm to the greatest common
advantage.
b. Where a partner is entitled to interest in capital subscribed by him, such interest shall be
payable whether there are profits.
c. An outgoing partner has a right to claim a share in the profits of the firm till his account
is finally settled.
d. A partner may be expelled from the firm only with the consent of all the other partners.
Choose the correct option from the following options given below:
A. a, b, d only
B. a, c, d only
C. b, c, d only
D. c, d only
14. Under no circumstances the partnership firm shall be compulsorily dissolved by the court:
A. Persistent breach of agreement between the partners.
B. Business has become illegal due to changes in law.
C. Continuous huge loss in business.
D. Retirement of one of the partners.
15. What is a partnership at will?
A. Created under a will by testator.
B. Created with the consent of all partners.
C. Partnership without provision for duration of time
D. Partnership created for a particular event.
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16. A partner can retire by notice of intention to retire, where_________
A. The partnership is at will.
B. The partnership is for a specified purpose.
C. A contract has been made between the partners for its determination.
D. He cannot retire in the partnership.
17. An agreement in restraint of trade in a partnership under section 11 of the Indian Partnership
Act is __________
A. Valid
B. Voidable
C. Void
D. Illegal
18. The authority of a partner to bind the firm by his acts done in the usual course of his business
is called his “implied authority “. Such authority does not include:
A. Selling the firms’ goods
B. To borrow from a trading firm.
C. Settling accounts with the people dealing with the firm.
D. Withdraw a suit or proceeding filed on the firm's behalf.
19. Who was the judge who delivered the judgment in the famous case Gannon Dunkerley & Co.
(Madras) Ltd 2959 SCR 379?
A. Justice Koka Subbarao
B. Justice Venkatachelliah
C. Justice Venkatarama Aiyar
D. Justice Venkata Ratnam Nayar
20. What is the meaning of the legal maxim “quic quid plantatur solo, solo cedit”
A. Whatever is affixed to the soil belongs to the soil.
B. Whatever is transferred to the person belongs to the person.
C. Whatever is transferred to the buyer belongs to the buyer.
D. Whatever is transferred to the vendee belong to the buyer.
II. [Link] Rao is working as a state government employee and with his salaried earning, he
could manage to buy a plot of land. As he could not find time and enough skill to construct a
dream house in that land, he requested his childhood friend, [Link], who happened to be
a known builder in the locality to construct a duplex house. An agreement of contract entered
for construction of house for Rs.80 lakhs. For the execution of the contract, he who has
employed his men to construct the same and initially he has spent Rs. 10 lakhs to purchase
the material and given Rs. 1 lakh to the labourers for their ration and stay in the premises of
construction area. Whether these mentioned amounts spent for the purpose of purchasing
material and ration would fall within the purview of contract of sale or not? Examine.
(1 x 10 marks = 10 marks)
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III. Critically examine the case of “[Link] & Co. v. Commissioner of Income Tax
(1971) 2 SCC 87”.
(1 x 10 marks = 10 marks)
IV. In a partnership agreement it was stated that “No partner was to sell or dispose of his
interest without the consent in writing of his partners, all dealings with the property of
partnership were to be transacted by and through Trimble, to whom the other partners
were to given powers of attorney” Explain the above statement with the relevant case law
and legal provisions.
(1 x 10 marks = 10 marks)
V. Answer any two of the following (Out of the three) (2 x 5 marks = 10 marks)
i. Explain the concept of “Hire-Purchase agreement” with the help of decided cases.
ii. Analyze the case of Vishnu Agencies (P) Ltd. V. Commercial Tax Officer, AIR 1978 SC
449: (1978) 1 SCC 520.
iii. Examine, whether the consumption of food in the hotel falls under the category of sale
of goods or not?
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