All India Management Association (AIMA) 2007 M.B.A Marketing Management Business Law - II - Question Paper

Therefore, in the provided instance, the purchase of the photocopying machine cannot be deemed to be for commercial use as it was purchased to comply with statutory requirement for use by public. Hence, choice ‘C’ is accurate ans. < TOP >
28. A Any secured interest created in favour of any secured creditor may be enforced without intervention of Court or Tribunal.
Therefore, in the provided instance, the bank can take over the open land and proceed to recover its dues directly without any intervention of any Court or Tribunal. Hence, choice ‘A’ is accurate ans. < TOP >
29. E The insurance contract is an aleatory, voluntary, executory and conditional contract ranging from the 2 parties. All the formalities needed to form a valid contract are to be observed in formulating the contract. Failure of a precedent condition invalidates an insurance contract like a general contract.
Therefore, in the provided instance, the insurer is not liable as the giving of wrong address amounts to breach of 1 of the conditions on which the policy was issued. Hence, choice ‘E’ is accurate ans. < TOP >
30. C In Restrictive Crossing the words “Account Payee” are added to the general or special crossing. The words “Account Payee” on a cheque are direction to the collecting banker that the amount collected on the cheque is to be credited to the account of the payee. “Account Payee” cheques are not negotiable.
According to part 124, where a cheque bears across its face an addition of the name of a banker, either with or without the words “not negotiable” that addition shall be deemed a crossing, and the cheque shall be deemed to be crossed specially, and to be crossed to that banker.
According to part 130 of the Act, the effect of the words “not negotiable” on a crossed cheque is that the title of the transferee of such a cheque cannot be better than that of its transferor. The addition of the words “not negotiable” does not restrict the further transferability of the cheque. The object of crossing a cheque “not negotiable” is to afford protection to the drawer or holder of the cheque against miscarriage or dishonesty in the course of transit by making it difficult to get the cheque so crossed cashed, until it reaches its destination. Hence, ‘C’ is the accurate ans. < TOP >
31. C All general insurance contracts are short-term contracts. The expired contracts can be revived by renewal and renewal of contract amounts to a fresh contract. Presence of insurable interest is essential. Amount payable as compensation depends on different factors including intention of the insured. Hence, choice ‘C’ is accurate ans. < TOP >

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