Lab

THE PATENT ACT OF 1970
INTELLECTUAL PROPERTY RIGHTS

PATENT
A Patent is a monopoly to a person who has invented a new and useful article or it
is an improvement of existing
article or a new process of making an article.
New invention:
Not anticipated by publication or used elsewhere in the world.
What can be patented:
The subject matter must be patentable.
The invention must be novel
The invention must have some utility or usefulness
The invention must not be obvious.
VARIETY OF PATENTS
Utility Patent:
process machine manufacture
Improvement
Composition
of existing
of a matter
idea
VARIETY OF PATENTS
Design patent:
If you create a new and original design that ornaments a

manufactured device, it qualifies for a design patent. Guard
the unauthorised use of new, original and ornamental designs
for articles of manufacture.
PROCEDURE FOR OBTAINING PATENTS
Process followed in obtaining patent:
1. File an application.
2. Formality check.
3. Publication.
4. Request for examination.
5. Examination.
6. Issue of first examination report.
7. Response from the applicant.
8. Pre grant opposition.
9. Examination of pre grant opposition.
10. Consideration of pre grant opposition.
11. Grant of patent.
RIGHTS OF A PATENTEE
Rights of patentee:
1. He can sell the whole or part of it.
2. He can also grant license.
3. He can assign such property.
TRANSFER OF PATENTS
Benefits of patent:
1. Right to stop others without permission.
2. Protection for a fixed period.
3. Right to use invention by self.
4. License the patent.
Transfer of patents:
1 • ASSIGNMENT
2 • LICENSE
3 • TRANSMISSION BY OPERATION OF LAW
PATENT INFRINGEMENT
Patent is said to be infringed in the following situations:
Doctrine of
Literal infringement equivalents
Contributory
Inducement infringement
EVER GREENING OF PATENTS
GLIVEC EPISODE
2003: Novartis launches Imatinib mesylate(Glivec) – blood cancer medicine.
2005: While drugs can be patented, law is intepreted to grant Patents only to ‘true medical
innovations’.
2006: Novartis ‘s patent rejected by IPO.
Novartis- files again rejection- Madras high court
Challenge under section 3(d) of the Act.
2007: Madras high court rules against Novartis stating ‘efficacy’ u/s.3(d)
2009: IPAB- rejects Novartis’s appeal
It appeals against Supreme court
2013: Final order passed against Novartis saying the modification cannot be considered as
invention.
TRADEMARK
Protect words, names, symbols ,sounds , or colours that

distinguish goods and services. Trademarks, unlike
patents, can be renewed forever as long as they are
being used in business. Trademarks can also take many
other forms such as shape, colour, sound or scent.
The shape of a Coco-Cola bottle is a familiar trademark.
TRADEMARK
COPYRIGHT
It involves creative work and includes:
 Artistic work
 Dramatic work
 Literary works
 Musical work
 Cinematographic films
 Sound recordings
GEOGRAPHICAL INDICATION
GI in relation to goods means an indication which identifies such

goods as agricultural goods, natural goods or manufactured
goods as originating or manufactured in the territory of a country
or a region or locality in that territory.
TRADE SECRETS:
A trade secret is a kind of information which has commercial value
and can be protected from misuse or misappropriation under
common law.
TRADITIONAL KNOWLEDGE
INFORMATION TECHNOLOGY ACT, 2000
ESSENCE OF IT ACT
ESSENCE OF IT ACT:
1. Legal recognition of Electronic documents.
2. Legal recognition of digital signature.
3. Offences and contraventions
4. Justice dispensation system for cyber crime
 E-transactions
 Legalising e-mail messages
 E- governance (notifications)
 E-Form
CONCEPTS OF IT ACT
Statutory remedy for Cyber Crime(Monetary damages not exceeding
Rs.1 Crore)
E-Commerce
E-Gazette
Cyber Crimes:
a) Unauthorised Access
b) Hacking
c) Trojan Attack
d) Virus and Worm attack
e) Forgery
CONCEPTS OF IT ACT
Email and Internet related crimes:

 Email spoofing
 Email spamming
 Sending malicious codes through emails
 Email bombing
5
DEFINITIONS
(a) “access” with its grammatical variations and cognate expressions means
gaining entry into, instructing or communicating with the logical,
arithmetical, or memory function resources of a computer, computer
system or computer network.
(b) “addressee” means a person who is intended by the originator to receive
the electronic record but does not include any intermediary.
(c) “adjudicating officer” means an adjudicating officer appointed under sub-
section (1) of section 46.
(d) “asymmetric crypto system” means a system of a secure key pair
consisting of a private key for creating a digital signature and a public key
to verify the digital signature.
DIGITAL SIGNATURE
7
DIGITAL SIGNATURE
8
DIGITAL SIGNATURE
DS a type of asymmetric cryptography used to simulate the security
properties of a signature in digital, rather than written, form. Digital
signature schemes normally give two algorithms, one for signing which
involves the user's secret or private key, and one for verifying signatures
which involves the user's public key. The output of the signature process
is called the "digital signature.“
DS is an electronic signature that can be used to authenticate the identity
of the sender of a message or the signer of a document, and possibly to
ensure that the original content of the message or document that has
been sent is unchanged. Digital signatures are easily transportable,
cannot be imitated by someone else, and can be automatically time-
stamped. The ability to ensure that the original signed message arrived
means that the sender cannot easily repudiate it later.
DIGITAL SIGNATURE
 The use of digital signatures usually involves two
processes, one performed by the signer and the other by
the receiver of the digital signature:
 Digital signature creation uses a hash result derived from
and unique to both the signed message and a given
private key. For the hash result to be secure, there must
be only a negligible possibility that the same digital
signature could be created by the combination of any
other message or private key.
 Digital signature verification is the process of checking
the digital signature by reference to the original
message and a given public key, thereby determining
whether the digital signature was created for that same
message using the private key that corresponds to the
referenced public key.
CYBERCRIMES
TYPES OF CYBERCRIMES:
1. Cyber terrorism
2. Cyber pornography
3. Defamation
4. Cyber stalking (section 509 IPC)
5. Sale of illegal articles-narcotics, weapons
6. Online gambling
7. Intellectual Property crimes- software piracy, copyright
infringement, trademarks violations, theft of computer source
code
8. Phishing
9. Credit card frauds
SOURCE CODE
 Most important asset of software companies “Computer

Source Code" means the listing of programmes, computer
commands, design and layout
 Concealment, destruction, alteration of computer source
code
 Punishment : imprisonment up to three years and / or fine
up to Rs. 2 lakh
PENALTIES UNDER IT ACT 2000
Source code - imprisonment up to three years and /

or fine up to Rs. 2 lakhs
Hacking - imprisonment up to three years, and / or
– fine up to Rs. 5 lakhs
Pornography - imprisonment up to five years and
fine up to Rs. 10 lakhs
On subsequent conviction, imprisonment up to ten
years and fine up to Rs. 2 lakhs
PORNOGRAPHY
 Publishing or transmitting or causing to be published
in the electronic form Obscene material
 Punishment :
 On first conviction
 imprisonment up to five years and fine up to Rs. 1 lakh
On subsequent conviction
imprisonment up to ten years and fine up to Rs. 2 lakh
 Section covers Internet Service Providers, Search
engines, Pornographic websites
 Cognizable, Non-Bailable
DATA DIDDLING
Changing data prior or during input into a computer covers the
offence of data diddling
 Penalty: Not exceeding Rs. 1 crore
 Case in point : NDMC Electricity Billing Fraud Case
 Punishment – imprisonment up to three years, and / or fine up
to Rs. 2 lakh
 Cognizable, Non Bailable
 Covers data theft as well as data alteration
 A private contractor who was to deal with receipt and accounting of electricity bills by the NDMC, Delhi. Collection of money, computerized accounting,
record maintenance and remittance in his bank who misappropriated huge amount of funds by manipulating data files to show less receipt and bank
remittance.
CYBER SECURITY
16
Section Offence Punishment Bailability and Congizability
65 Tampering with Imprisonment up to 3 years or fine up to Offence is Bailable, Cognizable and triable
Computer Rs 2 lakhs by Court of JMFC.
Source Code
66 Computer Related Offences Imprisonment up to 3 years or fine up to Offence is Bailable, Cognizable and
Rs 5 lakhs
66-A Sending offensive messages Imprisonment up to 3 years and fine Offence is Bailable, Cognizable and triable
through by Court of JMFC
Communicati
on service, etc...
66-B Dishonestly receiving stolen Imprisonment up to 3 years and/or fine Offence is Bailable, Cognizable and triable
computer resource or up to Rs. 1 lakh by Court of JMFC
communication device
66-C Identity Theft Imprisonment of either description up to Offence is Bailable, Cognizable and triable
3 years and/or fine up to Rs. 1 lakh by Court of JMFC
66-D Cheating by Personation Imprisonment of either description up to Offence is Bailable, Cognizable and triable
by using 3 years and /or fine up to Rs. 1 lakh by Court of JMFC
computer resource
66-E Violation of Privacy Imprisonment up to 3 years and /or fine Offence is Bailable, Cognizable and triable
up to Rs. 2 lakh by Court of JMFC
66-F Cyber Terrorism Imprisonment extend to imprisonment Offence is Non-Bailable, Cognizable
for Life and triable by Court of Sessions
Section Offence Punishment Bailability and
Congizability
67 Publishing or transmitting obscene material in electronic form On first Conviction, imprisonment up to 3 years and/or fine Offence is Bailable, Cognizable and
up to Rs. 5 lakh On Subsequent Conviction imprisonment triable by Court of JMFC
up to 5 years and/or fine up to Rs. 10 lakh
67-A Publishing or transmitting of material containing sexually On first Conviction imprisonment up to 5 years and/or fine Offence is Non-Bailable, Cognizable
explicit act, etc... in electronic form up to Rs. 10 lakh On Subsequent Conviction imprisonment and triable by Court of JMFC
up to 7 years and/or fine up to Rs. 10 lakh
67-B Publishing or transmitting of material depicting children in On first Conviction imprisonment of either description up Offence is Non Bailable, Cognizable
sexually explicit act etc., in electronic form to 5 years and/or fine up to Rs. 10 lakh On Subsequent and triable by Court of JMFC
Conviction imprisonment of either description up to 7 years
and/or fine up to Rs. 10 lakh
67-C Intermediary intentionally or knowingly contravening the Imprisonment up to 3 years and fine Offence is Bailable, Cognizable.
directions about Preservation and retention of information
68 Failure to comply with the directions given by Controller Imprisonment up to 2 years and/or fine up to Rs. 1 lakh Offence is Bailable, Non-Cognizable.
69 Failure to assist the agency referred to in sub section (3) in Imprisonment up to 7 years and fine Offence is Non-Bailable, Cognizable.
regard interception or monitoring or decryption of any
information through any computer resource
69-A Failure of the intermediary to comply with the direction issued Imprisonment up to 7 years and fine Offence is Non-Bailable, Cognizable.
for blocking for public access of any information through any
computer resource
Section Offence Punishment Bailability and
Congizability
69-B Intermediary who intentionally or knowingly contravenes the Imprisonment up to 3 years and fine Offence is Bailable, Cognizable.
provisions of sub-section (2) in regard monitor and collect
traffic data or information through any computer resource for
cybersecurity
70 Any person who secures access or attempts to secure access Imprisonment of either description up to 10 Offence is Non-Bailable,
to the protected system in contravention of provision of Sec. years and fine Cognizable.
70
70-B Indian Computer Emergency Response Team to serve as Imprisonment up to 1 year and/or fine up to Offence is Bailable, Non-
national agency for incident response. Any service provider, Rs. 1 lakh Cognizable
intermediaries, data centres, etc., who fails to prove the
information called for or comply with the direction issued by
the ICERT.
71 Misrepresentation to the Controller to the Certifying Imprisonment up to 2 years and/ or fine up Offence is Bailable, Non-
Authority to Rs. 1 lakh. Cognizable.
72 Breach of Confidentiality and privacy Imprisonment up to 2 years and/or fine up Offence is Bailable, Non-
to Rs. 1 lakh. Cognizable.
72-A Disclosure of information in breach of lawful contract Imprisonment up to 3 years and/or fine up Offence is Cognizable, Bailable
to Rs. 5 lakh.
73 Publishing electronic Signature Certificate false in certain Imprisonment up to 2 years and/or fine up Offence is Bailable, Non-
particulars to Rs. 1 lakh Cognizable.
74 Publication for fraudulent purpose Imprisonment up to 2 years and/or fine up Offence is Bailable, Non-
to Rs. 1 lakh Cognizable.
A legal maxim is an established principle or proposition. The Latin term which were used as the language
for law and courts, are presently in use in law. A list of important legal maxims with meaning is
being given hereunder:
Term/Phrase Meaning
ab initio From the beginning.
ad hoc Not intended to be able to be adapted to other purposes.
ad idem To the same thing.
ad infinitum To infinity.
ad valorem According to value.
alter ego A second identity living within a person.
amicus curiae Friend of the court.
audi alteram partem Hear the other side.
bona fide In good faith.
de facto In fact.
de jure In law.
de novo A new.
dehors Outside of.
ex gratia As a matter of grace or favour.
ex officio By virtue of an office.
ex parte Expression used to signify something done or said by one person not in the presence
of his opponent.
fait accompli An accomplished act.
actus reus Guilty act.
in personam Against the person.
in rem An act/proceeding done or directed with reference to no specific person or with

reference to all whom it might concern.
inter alia Amongst other things.
inter vivos Between living persons.
intestate A person is deemed to die intestate in respect of property of which he or she has
not made a testamentary disposition (“will”) capable of taking effect.
intra vires Within the powers.

ipso facto By the mere fact.
ipso jure By the law itself.
lis pendens A pending suit.
locus standi Signifies a right to be heard.
mens rea A guilty mind.
mesne profits Intermediate profits, the profits which a person in wrongful possession of the
property actually received or might with ordinary diligence have received therefrom
together with interest on such profits excluding the profits due to improvement
made by the person in wrongful possession.
modus operandi Mode of operating; the way in which a thing, cause etc. operates.
mutatis mutandis W ith the necessary changes in points of detail, with such change as may be
necessary.
obiter dictum An opinion of law not necessary to the decision. An expression of opinion (formed)
by a judge on a question immaterial to the ratio decidendi, and unnecessary for the
decision of the particular case. It is no way binding on any court, but may receive
attention as being an opinion of high authority.
pendente lite During litigation.
quid pro quo The giving of one thing of value for another thing of value; one for the other; thing
given as compensation.
ratio decidendi Reasons for deciding, the grounds of decision.
res integra An untouched matter; a point without a precedent; a case of novel impression.
res judicata A case or suit already decided.
rule nisi A rule to show cause why a party should not do a certain act, or why the object of
the rule should not be enforced.
sine die Without day.

'
sine qua non An indispensable requisite.
stare decisis To stand by things decided; to abide by precedents where the same points come
again in litigation.
status quo Existing condition.
sub judice Before a judge or court, pending decision of a competent count.
ultra vires Beyond one’s powers.

LEGAL ASPECTS OF BUSINESS
INTRO TO LEGAL SYSTEMS AND CONCEPTS

Significance of Law
• Realists define law in terms of judicial process. According to Holmes, “Law is a statement of the
circumstances in which public force will be brought to bear upon through courts.
• From the above definition it follows that law is nothing but a mechanism of regulating the human
conduct in society so that the harmonious co-operation of its members increases and thereby avoid
the ruin by coordinating the divergent conflicting interests of individuals and of society which would, in
its turn, enhance the potentialities and viability of the society as a whole.
To summarise, following are the main characteristics of law and a definition to become universal one,
must incorporate all these elements:
– Law pre-supposes a State
– The State makes or authorizes to make, or recognizes or sanctions rules which are called law
Significance of Law
• Separate rules and principles are known as ‘laws’. Such laws may be mandatory, prohibitive or
permissive. A mandatory law calls for affirmative act, as in the case of law requiring the
payment of taxes. A prohibitive law requires negative conduct, as in the case of law prohibiting
the carrying of concealed weapon or running a lottery. A permissive law is one which neither
requires nor forbids action, but allows certain conduct on the part of an individual if he desires
to act.
Laws are made effective:
• By requiring damages to be paid for an injury due to disobedience
• By requiring one, in some instances, to complete an obligation he has failed to perform
• By preventing disobedience
By administering some form of punishment
• The law, and the system through which it operates, has developed over many centuries
into the present combination of statutes, judicial decisions, customs and conventions. By
examining the sources from which we derive our laws and legal system, we gain some insight
into the particular characteristics of our laws.
BUSINESS LAW
Business law establishes a set of rules and prescribes

conduct that enables us to avoid misunderstanding and
injury in our business relationships.
SCOPE:
It usually deals with topics of
Licences, Monopolies,issue of Securities, contracts,
Property, Negotiable Instrument, Consumer interest,
import of capital goods, Pollution control etc.,
SOURCES OF LAW
1) Constitution
2) Legislation/Statute
3) Custom
4) Case law/Common Law
5) Natural law
6) English law
7) Ordinances
8) Administrative law
9) Equity
CLASSIFICATION OF LAW
1. Substantive law
2. Procedural law
3. Public law
4. Private law
5. Civil law
6. Criminal law
CONSTITUTION OF INDIA
1. Constituent assembly
2. Constitution – Basic legal framework
3. Sovereign
4. Socialist
5. Secular
6. Democratic
7. Republic
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1. System of double government

2. Distribution of Powers(Union, State and
Concurrent list)
3. Rigid & Written Constitution
4. Independent judiciary
5. Supremacy of Constitution.
(KESAVANANDA BHARATI VS STATE OF KERELA)
CONSTITUTION
Document which sets out the framework and the principal functions of
the organs of government.
Constitutional Law :
Rules which regulate the structure of the Principal organs of the
government and their relationship.
LEGISLATIVE
EXECUTIVE
JUDICIARY
KINDS OF CONSTITUTION
TYPES
WRITTEN RIGID FEDERAL
& & &
UNWRITTEN FLEXIBLE UNITARY
1. System of double government

2. Distribution of Powers(Union, State and
Concurrent list)
3. Rigid & Written Constitution
4. Independent judiciary
5. Supremacy of Constitution.
CLASSIFICATION OF LAW
13
LEGAL TERMS AND MAXIMS
WORD PAD
Doc
HEIRARCHY OF COURTS
1. Supreme court
2. High Court
3. Business Courts
4. Alternative Dispute Resolutions
5. Tribunals
HIGH COURTS
(i) The decisions of High Court are binding on all the subordinate courts
and tribunals within its jurisdiction. The decisions of one High Court have
only a persuasive value in a court which is within the jurisdiction of
another High Court. But if such decision is in conflict with any decision of
the High Court within whose
jurisdiction that court is situated, it has no value and the decision of that
High Court is binding on the court.
In case of any conflict between the two decisions of co-equal Benches,
generally the later decision is to be followed.
HIGH COURTS
One Bench of the same High Court cannot take a view contrary to the decision already
given by another co- ordinate Bench of that High Court. Though decision of a Division
Bench is wrong, it is binding on a single judge of the same High Court.
Thus, a decision by a Bench of the High Court should be followed by other Benches unless
they have reason to differ from it, in which case the proper course is to refer the question for
decision by a Full Bench.
(iii) The High Courts are the Courts of co-ordinate jurisdiction. Therefore, the decision of
one High Court is not binding on the other High Courts and have persuasive value only.
Pre-constitution (1950) Privy Council decisions are binding on the High Courts unless
overruled by the Supreme Court.
SUPREME COURT
 The Supreme Court is the highest Court and its decisions are
binding on all courts and other judicial tribunals of the country.
Article 141 of the Constitution makes it clear that the law
declared by the Supreme Court shall be binding on all courts
within the territory of India.
However, it does not mean that every statement in a judgement

of the Supreme Court has the binding effect. Only the statement
of ratio of the judgement is having the binding force.
SUPREME COURT
 ‘all courts’ used in Article 141 refers to courts other than the
Supreme Court. Thus, the Supreme Court is not bound by its
own decisions. However, in practice, the Supreme Court has
observed that the earlier decisions of the Court cannot be
departed from unless there are extraordinary or special reasons
to do so (AIR 1976 SC 410). If the earlier decision is found
erroneous and is thus detrimental to the general welfare of the
public, the Supreme Court will not hesitate in departing from it.
English decisions have only persuasive value in India. The

Supreme Court is not bound by the decisions of Privy Council
or Federal Court. Thus, the doctrine of precedent as it operates
in India lays down the principle that decisions of higher courts
must be followed by the courts subordinate to them. However,
higher courts are not bound by their own decisions (as is the
case in England).
SUBORDINATE COURTS
 Civil courts
(District judge, Sessions Judge)
 Criminal courts
(Second class Magistrate, First class Magistrate, Sessions
court)
 Courts of Revenue
(Board of Revenue,Commissioner, Collectors, Tehsildars
court)
 Business Courts
(technology disputes & cyber courts)
SUBORDINATE COURTS
 Alternative Disputes resolution
(Arbitration, Conciliation, Negotiation)
 Tribunal
(SAT, COMPAT, ITAT, CAT)
 Fundamental rights
(Right to freedom, Right to equality, Right to freedom of
Religion, Right against exploitation, Right to constitutional
remedies, Cultural & educational rights)
 Directive Principles
1
Writ jurisdiction
The Indian Constitution empowers the Supreme Court

to issue writs for enforcement of fundamental rights.
It includes:
High Court Art. 226 & Supreme Court Art. 32
1. Writ of habeas Corpus.

2. Writ of Mandamus.
3. Writ of Prohibition.
4. Writ of Certiorari.
5. Writ of Quo Warranto.
LABOUR LAWS
1. The Factories Act
2. The Payment of Wages Act
3. The Minimum Wages Act
4. The Maternity Benefit Act
5. The Payment of Gratuity Act
6. The Employees state Insurance Act
7. The Payment of Bonus Act
8. The Equal Remuneration Act
9. The Employees Compensation Act
10. The Industrial Disputes Act
INFORMATION TECHNOLOGY ACT, 2000
ESSENCE OF IT ACT
ESSENCE OF IT ACT:
1. Legal recognition of Electronic documents.
2. Legal recognition of digital signature.
3. Offences and contraventions
4. Justice dispensation system for cyber crime
➢ E-transactions
➢ Legalising e-mail messages
➢ E- governance (notifications)
➢ E-Form
CONCEPTS OF IT ACT
➢Statutory remedy for Cyber Crime(Monetary damages not exceeding
Rs.1 Crore)
➢E-Commerce
➢E-Gazette
➢Cyber Crimes:
a) Unauthorised Access
b) Hacking
c) Trojan Attack
d) Virus and Worm attack
e) Forgery
CONCEPTS OF IT ACT
Email and Internet related crimes:

➢ Email spoofing
➢ Email spamming
➢ Sending malicious codes through emails
➢ Email bombing
5
DEFINITIONS
(a) “access” with its grammatical variations and cognate expressions means
gaining entry into, instructing or communicating with the logical,
arithmetical, or memory function resources of a computer, computer
system or computer network.
(b) “addressee” means a person who is intended by the originator to receive
the electronic record but does not include any intermediary.
(c) “adjudicating officer” means an adjudicating officer appointed under sub-
section (1) of section 46.
(d) “asymmetric crypto system” means a system of a secure key pair
consisting of a private key for creating a digital signature and a public key
to verify the digital signature.
DIGITAL SIGNATURE
7
DIGITAL SIGNATURE
DS a type of asymmetric cryptography used to simulate the security
properties of a signature in digital, rather than written, form. Digital
signature schemes normally give two algorithms, one for signing which
involves the user's secret or private key, and one for verifying signatures
which involves the user's public key. The output of the signature process
is called the "digital signature.“
DS is an electronic signature that can be used to authenticate the identity
of the sender of a message or the signer of a document, and possibly to
ensure that the original content of the message or document that has
been sent is unchanged. Digital signatures are easily transportable,
cannot be imitated by someone else, and can be automatically time-
stamped. The ability to ensure that the original signed message arrived
means that the sender cannot easily repudiate it later.
DIGITAL SIGNATURE
❖ The use of digital signatures usually involves two
processes, one performed by the signer and the other by
the receiver of the digital signature:
❖ Digital signature creation uses a hash result derived from
and unique to both the signed message and a given
private key. For the hash result to be secure, there must
be only a negligible possibility that the same digital
signature could be created by the combination of any
other message or private key.
❖ Digital signature verification is the process of checking
the digital signature by reference to the original
message and a given public key, thereby determining
whether the digital signature was created for that same
message using the private key that corresponds to the
referenced public key.
CYBERCRIMES
TYPES OF CYBERCRIMES:
1. Cyber terrorism
2. Cyber pornography
3. Defamation
4. Cyber stalking (section 509 IPC)
5. Sale of illegal articles-narcotics, weapons
6. Online gambling
7. Intellectual Property crimes- software piracy, copyright
infringement, trademarks violations, theft of computer source
code
8. Phishing
9. Credit card frauds
SOURCE CODE
❖ Most important asset of software companies “Computer

Source Code" means the listing of programmes, computer
commands, design and layout
❖ Concealment, destruction, alteration of computer source
code
❖ Punishment : imprisonment up to three years and / or fine
up to Rs. 2 lakh
PENALTIES UNDER IT ACT 2000
Source code - imprisonment up to three years and /

or fine up to Rs. 2 lakhs
Hacking - imprisonment up to three years, and / or
– fine up to Rs. 2 lakhs
Pornography - imprisonment up to five years and
fine up to Rs. 1 lakhs
On subsequent conviction, imprisonment up to ten
years and fine up to Rs. 2 lakhs
PORNOGRAPHY
➢ Publishing or transmitting or causing to be published
in the electronic form Obscene material
➢ Punishment :
➢ On first conviction
❑ imprisonment up to five years and fine up to Rs. 1 lakh
On subsequent conviction
❑imprisonment up to ten years and fine up to Rs. 2 lakh
❑ Section covers Internet Service Providers, Search
engines, Pornographic websites
❑ Cognizable, Non-Bailable
DATA DIDDLING
Changing data prior or during input into a computer covers the
offence of data diddling
➢ Penalty: Not exceeding Rs. 1 crore
➢ Case in point : NDMC Electricity Billing Fraud Case
➢ Punishment – imprisonment up to three years, and / or fine up
to Rs. 2 lakh
➢ Cognizable, Non Bailable
➢ Covers data theft as well as data alteration
➢ A private contractor who was to deal with receipt and accounting of electricity bills by the NDMC, Delhi. Collection of money, computerized accounting,
record maintenance and remittance in his bank who misappropriated huge amount of funds by manipulating data files to show less receipt and bank
remittance.
CYBER SECURITY
15
BUSINESS LAWS
INDIAN CONTRACT ACT
2
Meaning of Contract
Definition of a Contract:
According to Sec 2(h) of the Indian Contract Act, “An Agreement enforceable by law is a
Contract”.
Contract
Agreement
Legal
Obligation
Agreement
One person making a proposal and other accepting the same.
• OFFER+ACCEPTANCE=AGREEMENT
PLURALITY OF CONSENSUS
PERSONS
LEGAL OBLIGATION: A duty enforceable by law.

A Rights and obligations B
SELLING A CAR FOR 10LAKS
Contractual obligation Corresponding right
to sell and corresponding to receive the car
right to receive 10 lakhs from A and contractual
obligation to pay
INR 10 lakhs to A
A person cannot enter into an Agreement with himself. Any contract
so entered is null
and void.
Any agreement which is void abinitio is not valid.
All contracts are agreements while all agreements are not Contracts.
S.10 says, “agreements are contracts if they are made by the free
consent of the parties competent to contract for a lawful
consideration and with a lawful object and not hereby expressly
declared to be void”.
Elements of a contract
• There are ten elements of a contract:
• Offer and Acceptance
• Intention to create legal relations
• Lawful consideration
• Persons competent to Contract
• Free Consent
• Lawful Object
• Writing and registration
• Certainty
• Possibility of performance
• Not expressly declared void
Kinds of contract
valid Voidable
Void contract
contract contract
Illegal or
Unenforceable
unlawful
contract
contract
Kinds of Contract
Valid Contract:
It is an agreement enforceable by law. All essential elements of a valid
contract are present.
Voidable Contract:
Voidable contract is one which is enforceable by law at the option of one of
the parties.
Void contract:
Void means not binding in law. A contract which ceases to be enforceable by
law becomes void, when it ceases to be enforceable.
Valid contract into void contract
• Following reasons:
Void Agreement:
• An agreement not enforceable by law is said to be void. Thus a void

agreement does not give rise to any legal consequence and is void
abinitio.
• A contract cannot be void abinitio. Only an agreement can be void

abinitio.
Unenforceable contract:
• An Contract which is valid in itself, but is not capable of being

enforced in the court of law because of some technical defect such as
absence of writing, registration, stamp etc. time barred by law. E.g.
Oral Arbitration Agreement.
• Illegal or unlawful contract:
An agreement unenforceable by law and contrary to
law. All illegal agreement is void abinitio.
Contract w.r.t mode of creation
 Express Contract: A contract made in words spoken or
written it is called Express Contract.
 Implied Contract: Where the contract is made otherwise

than in words(i.e. Acts & Conduct) .
 Constructive or quasi Contract: No express or implied

contract but the law infers or recognizes a contract under
special circumstances. E.g. Obligation of finder of lost goods.
Contract w.r.t extent of execution
 Executed Contract: Where both the parties have

completely performed their share of obligation and nothing
remains to be done by either party under contract. E.g. Book
seller to sell a book.
 Executory Contract: Both the obligation are o/s. one on
either party to the contract wholly or in part at the time of
the contract. E.g. Contract between two people to coach for
medical test from next month is executory.
Consideration
 Price paid for the promise of the others.
 Rules for Consideration:
 It must move at the desire of the promisor.
 It must move from the promisee to any other person.
 It may be an Act, abstinence or forbearance or a return promise.
 It may be past, present or future.
 It need not be adequate.
 It must be real and not illusory.
 It must be something which the Promisor is not bound to do.
 It must not be illegal, immoral or opposed to Public policy.
BUSINESS LAWS
INDIAN CONTRACT ACT
2
Exceptions to the law of consideration
S.25 deals with exceptions:
1. Agreement is expressed, in writing & registered and made out of

natural love and affection between parties.
2. If it is made to compensate a person who has done something
voluntarily.
3. Creation of Agency.
4. In case of a completed gift.
5. Promise to pay a debt barred by law of limitation.
6. Made for charitable Purposes.
CASE LAWS
1. A promises a subscription of Rs.10000 to the National Defense Fund. He does not pay. Is there
any legal remedy against him?
2. A husband executed a registered document in favor of his wife. After referring to quarrels and
disagreements between them, he promised to pay for her separate maintenance and residence.
On his failure to pay the wife seeks your advice. Advise her?
3. A’s car breaks down on G.T. Road. He asks B, a passing motorist, to tow the car to the nearest
garage. B tows the car and in return A promises to pay B at the garage Rs.200 as payment for
his trouble. Is A bound by his promise?
4. H who was badly in need of money offered to sell his piano worth Rs.5000 to C for Rs.4000.C
refused to buy. H gradually lowered his price until Rs.1000 was reached, which C accepted.
Before the piano was delivered, H received an offer for a larger sum from T, and he refused to
carry out the contract with C, claiming that the consideration was inadequate. Is H liable to pay
damages to C for failure to carry out his part of the contract?
CAPACITY TO CONTRACT
Majority
Sound mind
no disqualifications.
Minors Contract
1. Minors contract is void and cannot bind himself.
2. It cannot be ratified later since it is void abinitio.
3. A minors estate will be liable to pay reasonable price for
necessaries supplied to him.
4. He can be a beneficiary.
5. He cannot enter into contract of Partnership but appointed for the
benefits of Partnership.
Minors Contract
6. Any benefit under an void agreement he cannot be asked to
compensate.
7. He can plead minority.
8. No specific performance of contract.
9. A minor can be an Agent.
10.He is never personally liable and cannot be insolvent.
11.An agreement entered by parent or guardian on behalf of him is
binding on him provided it is for his benefit.
Lunatics Agreement
 A person of unsound mind is called a lunatic.
 A lunatics Agreement is void but if he makes a contract
when he is of sound mind then he will be bound by it.
 A sane man who is delirious from fever, drunk that he
cannot understand the terms of contract cannot contract
whilst such delirium or state of drunkenness lasts.
CASE LAWS
1. A minor is supplied with necessaries of life by a grocer. He makes out
promissory note in favor of the grocer. Is the grocer entitled to claim
payment under the promissory note (a)from minor personally (b)against
his estate?
2. A sold some articles from his shop to B on credit, not knowing that B was a
minor. The time fixed for payment expired and no payment was made.
Some time later when B attained majority, A sued him for the price? will he
succeed?
3. M, a minor aged 17, broke his right arm in a hockey game. He engaged a
physician to set it. Does the physician have a valid claim for his services?
4. A, an adult, said to M, a minor:”I will not pay the commission I promised
you for selling the magazines. You are a minor and cannot force me to
pay”. Is A right?
Flaws in Consent
No Free Consent
UNDUE
COERCION MISREPRESENTATION
INFLUENCE
FRAUD MISTAKE
MISREPRESENTATION
• INNOCENT WILFUL
MISREPRESENRATION MISREPRESENTATION
(FRAUD)
(A horse to be sound (non disclosure of liabilities
which is not true) document in prospectus)
CONSENT & FRAUD
Elements of Fraud:
1. There must be a representation and it must be false.
2. Representation must relate to material fact.
3. Intention to induce the other party.
4. Not caring whether it is true or false.
5. Other party is induced by it.
6. Relied and deceived by it.
MISTAKES
• Mistakes of law Mistakes of fact
Unilateral Bilateral
• No one can evade Mistakes are so

consequences on fundamental that
the plea that he was there is no Contract(void)
mistaken.
CASE LAWS
1. C offers to sell to D a painting which C knows is a good copy of a well known masterpiece. D
thinking that the painting is an original one and that C must be unaware of this, immediately
accept D’s offer. Does this result in a contract?
2. A purchased a typing machine on a dealers representation that it was a new model. After paying
the purchase price, he discovered that, although the machine looked new, it was actually a re-
built model. What are A’s legal rights?
3. The M.D of a theatre gave instructions that no tickets were to be sold to S. S knowing this, asked
a friend to buy a ticket for him. With this ticket S went to the theatre but was refused admissions.
He filed a suit for damages for breach of contract. Would he succeed?
4. A tells his wife that he would commit suicide, if she did not transfer her personal assets to him.
She does so under this threat. Can the wife avoid the contract.
PERFORMANCE OF A CONTRACT
Requisites:
1. It must be unconditional.
2. Whole quantity.
3. Willing to perform.
4. Proper trading norms.
5. Proper person.
6. One of the joint promisees.
7. Opportunity to inspect.
Contracts which need not be performed.
By Whom the contracts be performed?
Devolution of joint liabilities:
One can perform
Claim contribution
Sharing of loss
Release of joint promisor
Appropriation of Payments
Assignment of Contracts
 Act of parties/ Operation of law
CASE LAWS
1. A,B and C jointly promise to pay D 3,000. A and B are untraceable. Can D compel C to pay him in full?
2. A servant is employed for one year on a monthly salary of Rs.800, whole salary to be paid at the end of the
year. The servant wrongfully leaves the service after six months. Is he entitled to any salary?
3. X lent to Y three sums of Rs.100,Rs.200 and Rs.500. Y sent a sum of Rs.100 asking X to appropriate this
money towards the third debt of Rs.500. X wants to appropriate this money to the first loan. Can he do so?
4. A, a singer, enters into a contract with B, the manager of a theatre, to sing in his theatre two nights in every
week during the next two months and B agrees to pay her at the rate of Rs.1000 for each night. On the
sixth night A willfully absents himself. With the assent of B, A sings on the seventh night. But on the
following day, B puts an end to the contract. Can A claim damages for breach of contract? Advice A?
5. A and B enter into a contract that A shall do some work for B for Rs.500. A is ready and willing to do the
work, but B prevents him from doing so. Advise A?
REMEDIES FOR BREACH OF CONTRACT
Contract Rights & obligations
Remedies to enforce the rights
Remedy is the means given by law for enforcement of a

right.
REMEDIES OF INJURED PARTY
1) Recission of the contract.

2) Suit for damages.
3) Suit for quantum meruit.
4) Suit for specific performance of the contract.
5) Suit for injunction.
DAMAGES
Doctrine of restitution:
To put the injured party in the same position, as if he has not been injured.
Injured party is entitled to:
 Ordinary damages
 Special damages
 Exemplary/ Vindictive damages
 Nominal damages
 Liquidated damages
QUANTUM MERUIT
Meaning: as much as earned. When one party executes the contract and
other party repudiates the same.
SPECIFIC PERFORMANCE:
• Compensation in money cannot be got.
• Compensation in money is not adequate.
INJUNCTION:
• Party in breach of a negative term of a Contract.
CASE LAWS
1. A agreed to erect a plant for B by 31st January. The contract provided that
B should pay Rs.500/month for every month A took beyond the agreed
date? A was late by six months. B sued for Rs.6500(actual loss). To what
damages is B entitled to?
2. The wife of a person died from tin poisoning caused by the tinned salmon
bought from a dealer. What damages can the husband claim?
3. A undertook to write a book in six volumes. After completing four volumes
A died. Can his legal representatives get payment for work done?
4. A agrees to print a book for B not knowing that it contains libellous matter?
After printing a part he discovers that it contains libellous matter. Can A:
a. lawfully refuse to print the rest of the book?
b. Sue B for the work done by him?
INDIAN PARTNERSHIP ACT
1932
PARTNERSHIP ACT
DEFINITION:
“Partnership is the relation between two or more persons who have
agreed to share the profits of a business carried on by all of the or any
of them acting for all”
Partner, firm and Firm name:
Partner: Persons agreed together
Firm: Partners collectively
PARTNERSHIP ACT
CHARACTERISTICS OF P/S:
1. Association of two or more persons.
2. Agreement
3. Business
4. Sharing of profits
5. Mutual agency
6. Unlimited Liability
7. Management
PARTNERSHIP ACT
 Formation of P/S
 Partnership deed
 Who can be partners:
 Alien enemy
 Minor
 Person of unsound mind
 Corporation
PARTNERSHIP ACT
KINDS OF PARTNERSHIP
GENERAL /FIXED LIMITED

TERM P/S P/S
PARTICULAR
P/S @WILL P/S
PARTNERSHIP ACT
oREGISTRATION OF FIRMS
oPROCEDURE FOR REGISTRATION
oTIME OF REGISTRATION
oEFFECTS OF REGISTRATION
Suits between partners and firm
Suits between firms and third parties
Claim of set-off
oExceptions:
No place of business
Claim of set off not more than Rs.100/-
Powers of an official assignee
Right of third party
enforce a right otherwise than out of a contract
RELATIONS OF PARTNERS
Rights of partners:
1. Right to take part in business

2. Right to be consulted
3. Right of access to accounts
4. Right to share profits
5. Right to interest on Capital
6. Right to interest on advances
7. Right to use the P/S Property
8. Right to be indemnified
9. Right of partner as agent of the firm
10. No new partner to be introduced
11. No liability before joining
12. Right to retire
13. Right not to be expelled
14. Right of the outgoing partner to share in subsequent profits.
TYPES OF PARTNERS
ACTUAL/OSTENSIBLE
SLEEPING/DORMANT NOMINAL
PARTNER IN PROFITS ESTOPPEL OR

MINOR AS A PARTNER
ONLY HOLDING OUT
MINORS STATUS
Position before Majority
Rights
Liabilities
Position on attaining Majority
Where he elects
Where he rejects
DISSOLUTION OF A FIRM
WITHOUT THE ORDER OF
COURT BY THE COURT
1. By Agreement
Partner insanity
2. Compulsory Dissolution
 Insolvency of partners Permanent incapacity
 Illegal business Breach of agreement
3. On the happenning of certain
contigencies Misconduct of partner
Death of a partner
Transfer of interest
Expiry of term
Completion of work Continuous loss
Adjudication as an insolvent Just and equitable ground
4. By Notice
DISSOLUTION OF A FIRM
Rights of Partners on Dissolution:
i. Rights to have business wound off.
ii. Right to have the debts of the firm settled out of the property of the firm.
iii. Right to personal profits earned after dissolution
iv. Right to return of premium on premature dissolution
v. Contract rescinded on Fraud and misrepresentation
vi. Right to restrain partners from use of firm name or property
LIMITED LIABILITY PARTNERSHIP
• LLP is a body corporate and a legal entity separate from its partners, having
perpetual succession. LLP form is a form of business model which :
• (i) is organized and operates on the basis of an agreement.
• (ii) provides flexibility without imposing detailed legal and procedural
requirements
• (iii) enables professional/technical expertise and initiative to combine with
financial risk taking capacity in an innovative and efficient manner.
LIMITED LIABILITY PARTNERSHIP
FIRM AND LLP
CONTRACT OF AGENCY
2
CREATION OF AGENCY
Implied Contract
➢Agency by estoppel
➢Agency by holding out
➢Agency by necessity
• Person entrusted with others Property
• Agent exceeding his authority in emergency
3
CLASSIFICATION OF AGENTS
• Special agents
• General agents
• Universal agents
• Commercial/ Mercantile agents
➢Auctioneer
➢Broker
➢Commission agent
➢Del credere agent
4
DUTIES OF AN AGENT
1. To carry out the work undertaken according to the directions given by the
principal.
2. To carry out the work with reasonable care, skill and diligence.
3. To render proper accounts to his Principal.
4. To communicate with the principal in case of difficulty.
5. Not to deal on his own account.
6. To pay sums received for the Principal.
7. To protect and preserve the interest of principal in case of his death or
insolvency.
5
DUTIES OF AN AGENT
8. Not to use information obtained in the course of the Principal.

9. Not to make secret profit from agency.
10. Not to set up an adverse title.
11. Not to put himself in position where interest and duty conflict.
12. Not to delegate authority.
6
RIGHTS OF AGENT
1. Right of retainer
2. Right to receive remuneration
3. Right of lien
4. Right of indemnification
5. Right to compensation
6. Right of stoppage in transit
Duties of Principal is similar to Rights of an agent
7
AGENTS AUTHORITY
• Express
• implied
Actual/Real
• Authority to do all acts necessary to carry on the business

Ostensible/apparent
•
8
POSITION of P&A TO THIRD PARTIES
1. Named Principal
➢ Acts within his authority.
➢ Acts exceeding his authority.
➢ Notice to agent as notice to Pr.
➢ Principal inducing belief
➢ Fraud or misrepresentation
2. Unnamed Principal
3. Undisclosed Principal
9
TERMINATION OF AGENCY
1. By act of parties
❑ Agreement
❑ Revocation by the Principal.
❑ Revocation by the Agent.
2. By operation of law
✓ Performance of contract
✓ Expiry of time
✓ Death of either party
✓ Insanity of either party
✓ Insolvency
✓ Destruction of SM
✓ Principal being an alien enemy
✓ Dissolution of Company
✓ Termination of sub agents authority
10
CONSUMER
PROTECTION ACT
CONSUMER PROTECTION ACT
CONSUMER PROTECTION ACT 2019
It includes some new provisions as to
1. New definition of consumer include online purchasing.
2. Definition of goods include food.
3. Provisions covering 'endorsement' of goods and services.
4. Definition of 'electronic service provider'.
5. Provisions for 'product liability' and 'product liability action' for goods and
services.
6. Wide definition of 'unfair trade practice'.
CONSUMER PROTECTION ACT 2019
7. New definition of 'harm'.
8. Central Consumer Protection Authority.
9. Changes in pecuniary jurisdiction.
10. Civil and Criminal jurisdiction.
11. Electronically filing of complaint.
12. Mediation.
13. More powers to District Commission.
14. Offences and Penalties.
OBJECTIVES
1. Better protection of interest of consumers
2. Protection of rights of consumers
a. Protection against marketing of goods hazardous to life
b. Right against quality, quantity and potency
c. Right to access goods and services at competitive prices
d. Right to seek redressal against UTP/RTP
 Consumer protection councils

 Quasi judicial machinery for speedy redressal of consumer disputes.
ORGANIZATIONAL SET-UP
ADVISORY BODIES Central Consumer Protection ADJUDICATIVE BODIES

(Consumer Protection Councils) Authority (Consumer Disputes Redressal Agencies)
Central State District National

Consumer Consumer Consumer District State
Commission
Protection Protection Protection Forum Commission
(NCDRC)
Council Councils Councils
DEFINITIONS
 Appropriate laboratory: Recognised by central/state government
/others established by any law which is maintained and financed by
the Central/state government.
 Complaint: allegation in writing.
 Complainant: consumer, registered voluntary consumer association,
central/state government, Legal heirs, one or more consumers, the
central authority, in case of a consumer being a minor, his parent or
legal guardian;
 Consumer: who acquires goods or services for direct use or
ownership and not for resale or for commercial Purpose.
DEFINITIONS
 Consumer dispute: The person against whom the dispute is made denies
the allegations
◉ Goods: Every kind of moveable other than actionable claims and money.
and includes "food" as defined in section 3(1)(j) of the Food Safety and
Standards Act, 2006.
 Defect: any fault, imperfection in quality, quantity, purity and standard.
 Deficiency: Shortcoming or inadequacy in manner of performance.
 RTP: Manipulation of prices to affect the flow of supplies in the market
 UTP: Practice which promotes sale , use or supply of goods or services.
DEFINITIONS
"commercial purpose" does not include use by a person of goods bought and used by
him exclusively for the purpose of earning his livelihood, by means of self-employment.
"buys any goods" and "hires or avails any services" includes offline or online
transactions through electronic means or by teleshopping or direct selling or multi-level
marketing.
"endorsement", in relation to an advertisement, means—
(i) any message, verbal statement, demonstration; or
(ii) depiction of the name, signature, likeness or other identifiable personal characteristics
of an individual; or
(iii) depiction of the name or seal of any institution or organisation,
 which makes the consumer to believe that it reflects the opinion, finding or
experience of the person making such endorsement.
DEFINITIONS
"design", in relation to a product, means the intended or known physical

and material characteristics of such product and includes any intended or
known formulation or content of such product and the usual result of the
intended manufacturing or other process used to produce such product.
"commercial purpose" does not include use by a person of goods bought
and used by him exclusively for the purpose of earning his livelihood, by
means of self-employment; • (b) the expressions "buys any goods" and
"hires or avails any services" includes offline or online transactions through
electronic means or by teleshopping or direct selling or multi-level
marketing.
DEFINITIONS
“Direct selling” means marketing, distribution and sale of goods or

provision of services through a network of sellers, other than through a
permanent retail location;
“e-commerce” means buying or selling of goods or services including
digital products over digital or electronic network.
“Electronic service provider” means a person who provides technologies
or processes to enable a product seller to engage in advertising or
selling goods or services to a consumer and includes any online market
place or online auction sites.
DEFINITIONS
"establishment" includes an advertising agency, commission agent,

manufacturing, trading or any other commercial agency which carries on
any business, trade or profession or any work in connection with or
incidental or ancillary to any commercial activity, trade or profession, or
such other class or classes of persons including public utility entities in
the manner as may be prescribed.
"express warranty" means any material statement, affirmation of fact,
promise or description relating to a product or service warranting that it
conforms to such material statement, affirmation, promise or description
and includes any sample or model of a product warranting that the
whole of such product conforms to such sample or model.
DEFINITIONS
• "harm", in relation to a product liability, includes—
• (i) damage to any property, other than the product itself;
• (ii) personal injury, illness or death
• (iii) mental agony or emotional distress attendant to personal injury or illness or
damage to property; or
• (iv) any loss of consortium or services or other loss resulting from a harm referred
to in sub-clause (i) or sub-clause (ii) or sub-clause (iii) but shall not include any
harm caused to a product itself or any damage to the property on account of
breach of warranty conditions or any commercial or economic loss, including any
direct, incidental or consequential loss relating thereto.
• "mediation" means the process by which a mediator mediates the consumer
disputes.
DEFINITIONS
 "product liability" means the responsibility of a product manufacturer or product seller, of
any product or service, to compensate for any harm caused to a consumer by such
defective product manufactured or sold or by deficiency in services relating thereto.
 "product liability action" means a complaint filed by a person before a District

Commission or State Commission or National Commission, as the case may be, for
claiming compensation for the harm caused to him.
 "product" means any article or goods or substance or raw material or any extended
cycle of such product, which may be in gaseous, liquid, or solid state possessing intrinsic
value which is capable of delivery either as wholly assembled or as a component part and
is produced for introduction to trade or commerce, but does not include human tissues,
blood, blood products and organs;
UNFAIR CONTRACT
“unfair contract” means a contract between a manufacturer or trader or service

provider on one hand, and a consumer on the other, having such terms which
cause significant change in the rights of such consumer, including the following,
namely:—
(i) requiring excessive security deposits to be given by a consumer for the
performance of contractual obligations; or
(ii) imposing any penalty on the consumer, for the breach of contract thereof which
is wholly disproportionate to the loss occurred due to such breach to the other
party to the contract; or
UNFAIR CONTRACT
(iii) refusing to accept early repayment of debts on payment of

applicable penalty; or
(iv) entitling a party to the contract to terminate such contract
unilaterally, without reasonable cause; or
(v) permitting or has the effect of permitting one party to assign
the contract to the detriment of the other party who is a
consumer, without his consent; or
(vi) imposing on the consumer any unreasonable charge,
obligation or condition which puts such consumer to
disadvantage.
MEDIATION
Mediation:
(1) At the first hearing of the complaint after its admission, or at any
later stage, if it appears to the District Commission that there exists
elements of a settlement which may be acceptable to the parties, except
in such cases as may be prescribed, it may direct the parties to give in
writing, within five days, consent to have their dispute settled by
mediation in accordance with the provisions of Chapter V
(2) Where the parties agree for settlement by mediation and give their
consent in writing, the District Commission shall, within five days of
receipt of such consent, refer the matter for mediation, and in such case,
the provisions of Chapter V, relating to mediation, shall apply
PROCEDURE ON ADMISSION OF COMPLAINT.
(1) The District Commission shall, on admission of a complaint, or in respect

of cases referred for mediation on failure of settlement by mediation, proceed
with such complaint.
(2) Where the complaint relates to any goods, the District
Commission shall
(a) refer a copy of the admitted complaint, within twenty-one days from the
date of its admission to the opposite party mentioned in the complaint
directing him to give his version of the case within a period of thirty days or
such extended period not exceeding fifteen days as may be granted by it
(b) if the opposite party on receipt of a complaint referred to him under clause
(a) denies or disputes the allegations contained in the complaint, or omits or
fails to take any action to represent his case within the time given by the
District Commission.
(c) if the complaint alleges a defect in the goods which cannot be determined
without proper analysis or test of the goods, obtain a sample of the goods
from the complainant, seal it and authenticate it in the manner as may be
prescribed and refer the sample so sealed to the appropriate laboratory
along with a direction that such laboratory to make an analysis or test,
whichever may be necessary, with a view to finding out whether such goods
suffer from any defect alleged in the complaint or from any other defect and
to report its findings thereon to the District Commission within a period of
forty-five days of the receipt of the reference or within such extended • period
as may be granted by it.
( d) before any sample of the goods is referred to any appropriate laboratory

under clause (c), require the complainant to deposit to the credit of the
Commission such fees as may be specified, for payment to the appropriate
laboratory for carrying out the necessary analysis or test in relation to the
goods in question
(e) remit the amount deposited to its credit under clause (d) to the appropriate
laboratory to enable it to carry out the analysis or test mentioned in clause (c)
and on receipt of the report from the appropriate laboratory, it shall forward a
copy of the report along with such remarks as it may feel appropriate to the
opposite party;
(f) if any of the parties disputes the correctness of the findings of the
appropriate laboratory, or disputes the correctness of the methods of
analysis or test adopted by the appropriate laboratory, require the
opposite party or the complainant to submit in writing his objections
with regard to the report made by the appropriate laboratory
(g) give a reasonable opportunity to the complainant as well as the
opposite party of being heard
(f) issue an appropriate order.
CONSUMER PROTECTION COUNCIL
CONSUMER PROTECTION COUNCIL
CENTRAL CPC STATE CPC DISTRICT CPC

RIGHTS OFCONSUMERS
CONSUMER REDRESSAL AGENCIES
DISTRICT STATE
FORUM COMMISSION
NATIONAL
COMMISSION
Where to File a Complaint?
Forum Amount
District up to 1 Crore
State Above 1 Crore but

within ten crores.
National Exceeds ten Crores
LIMITATION PERIOD
(1) The District Commission, the State Commission or the National Commission shall not admit a
complaint unless it is filed within two years from the date on which the cause of action has arisen.
(2) Notwithstanding anything contained in sub-section (1), a complaint

may be entertained after the period specified in sub-section (1), if
the complainant satisfies the District Commission, the State
Commission or the National Commission, as the case may be, that
he had sufficient cause for not filing the complaint within such period
 Provided that no such complaint shall be entertained unless the District Commission or the State
Commission or the National Commission, as the case may be, records its reasons for condoning
such delay.
SPECIAL CONTRACTS
SALES OF GOODS ACT
CONDITIONS AND WARRANTIES

ESSENTIALS OF A CONTRACT OF SALE
Two parties
Goods
Price
Transfer of general property
Essential elements of a valid contract
SALE AND AGREEMENT TO SELL
1. Property passes 1. Property do not pass

2. Existing and specific 2. Future and contingent
goods. goods.
3. Goods destroyed, loss on 3. Falls on seller
buyer. 4. Seller only for
4. Seller can face loss for damages.(Breach)
price.(Breach) 5. General property can sue
5. Specific prop. only for damages.
CLASSIFICATION
• Ascertained
EXISTING • Unascertained
• specific
• Futuristic
FUTURE
PRICE OF GOODS
Manner
By the contract Specified In
Contract
Third party
Past Dealings
( Expert)
CONDITIONS AND WA RRANTIES
Express & Implied :
IMPLIED CONDITION:
1. Condition as to title
2. Sale by description
3. Quality or fitness
EXCEPTIONS
a) Abnormality
b) Patented/trademark
c) Many purposes
4. Condition as to Merchantability
5. Condition Implied by custom
6. Sale by sample.
7. Condition as to Wholesomeness.
CONDITIONS & WARRANTIES
Implied warranties:
1. Quiet possession
2. Freedom from encumbrances
3. Quality or fitness by usage of trade
4. Dangerous nature of goods
Caveat emptor:
1. Fitness for buyers purpose.
2. patent/trademark
3. Merchantable quality
4. Usage of trade
5. Consent by fraud.
TRANSFER OF PROPERTY
Transfer in goods refers to sale and there is a precise
movement from which the goods passes from the seller to the
buyer. This is important for the following reasons:
1. Risk follows ownership
2. Action against third parties
3. Insolvency - seller or buyer
4. Suit for price
Rules for ascertaining whether the property in goods passes to the buyer are
as follows:
Ascertained
goods
Unascertai
ned goods
Sale or return or
on approval basis
INTENTION OF
PARTIES
UNASCERTAINED
SPECIFIC GOODS
GOODS
SPECIFIC GOODS:
Passing of Property at the time of Contract.
Passing of Property delayed beyond the date of Contract.
i. Goods not in deliverable state.
ii. When Price is ascertained by weighing.
UNASCERTAINED GOODS:
 Ascertainment and appropriation of the Contract.
NEGOTIABLE INSTRUMENTS
The most commonly used credit instrument in modern business to

facilitate trade and commerce when it is not possible to settle all
business and commercial transactions in money terms.
Considering the value and volume of transactions it is not possible to

settle all transactions in cash
NEGOTIABLE INSTRUMENT MEANING
The term “negotiable” means transferable & the term

“instrument “means any written document creating a right in
favour of some person.
Thus negotiable instrument means a written document by

which a right is given to a person and which is transferable
in accordance with provision of Negotiable Instrument
Act,1881
TYPES OF NEGOTIABLE INSTRUMENTS
PROMISSORY NOTE
BILL OF EXCHANGE
CHEQUE
3
PROMISSORY NOTES
A promissory note is an instrument in writing [not being a currency

note]containing an unconditional undertaking signed by maker ,to pay a
certain sum of money only to a certain person or to the bearer of the
instrument.
Must be in writing. Writing includes print /typewriting
Must contain a express promise or undertaking to pay

PROMISSORY NOTES
BILL OF EXCHANGE
CHEQUE
 A
TYPES OF CHEQUE
1. Bearer cheque
2. Order cheque
3. Crossed cheque
4. Uncrossed / Open cheque
5. Post dated cheque
6. Stale cheque
7. Mutilated cheque
8. Gift cheques
9. Traveller’s cheque
TYPES OF CROSSINGS
1. General crossings
2. Special crossing
3. Restrictive crossings/Account payee crossing
BOUNCING OF CHEQUE:
 Insufficient funds
 Date mentioned on cheques
 Signature mismatch
 Difference in amount mentioned in numbers and words
 Damaged cheque
 Overwriting on cheque
12
ENDORSEMENT
endorsement means signing one’s name on the back of a negotiable instrument, say, a
cheque , with a view to transferringENDORSEMENT
the interest, right, property or title in the instrument
to anther person. endorsement means signing one’s name on the back of a negotiable
instrument, say, a cheque , with a view to transferring the interest, right, property or title
in the instrument to anther person.
ENDORSER ENDORSEE
13
ENDORSEMENT
 Endorsement to be made on the back or on the face of an instrument.
 The separate slip of paper attached to the instrument for the purpose of endorsement is
called an “allonge”.
 Blank or general endorsement

 Endorsement in full or special endorsement
 Restrictive Endorsement
 Sans Recourse Endorsement
 Facultative Endorsement
 Sans Frais Endorsement
14
KINDS OF ENDORSEMENT
1. Blank or general endorsement:
15
ENDORSEMENT IN FULL
aadiadildm
RESTRICTIVE ENDORSEMENT
Mr. Y Only
adildm
CONDITIONAL ENDORSEMENT
Pay Mr. A or Order on the arrival of Mr. S
at New Mangaluru Port by 23.Dec.2016
(sd.) adildm
SANS RECOURSE ENDORSEMENT
Mr. C or Order, Sans Recourse.
adildm
FACULTATIVE ENDORSEMENT
Mr. D or Order. Notice Of Dishonour Waived
adildm
SANS FRAIS ENDORSEMENT
Mr. M or Order, Sans Frais
adildm
HOLDER & HOLDER IN DUE COURSE
ESSENTIALS OF A HIDC:
1. Holder.
2. Good faith.
3. Consideration.
4. Before maturity.
1
SELLER(X) BUYER(Y)
AMAR 2 AKBAR
EMPLOYER 3 EMPLOYEE
22
COMPETITION ACT
2002
COMPETITION ACT
 Monopolistic and Restrictive Trade Practice under MRTP Act, 1969, was enacted. To ensure
that the operation of the economic system does not result in the concentration of economic
power in hands of few
• The MRTP Act brought in a four-pronged thrust(push suddenly or violently in a specified
direction)
Concentration of economic power
Restrictive Trade Practices
Monopolistic Trade Practices
Unfair Trade Practices
• Under the Competition Act :
• No provision for Unfair Trade Practices
• Only Consumer Courts will have jurisdiction
• All Disparagement Cases(criticizing competing products) will be transferred to Competition
Commission
COMPETITION ACT
• What Is Competition
• Background of Competition Act
• Objective and Conditions
• Anticompetitive practices
• Abuse of Dominance (Section 4)
• Mergers and Acquisitions
• Competition Advocacy
• Competition Commission of India
COMPETITION
It is “a situation in a market in which firms or sellers independently strive for the buyers’
patronage in order to achieve a particular business objective”
for example, profits, sales or market share
1. It is the foundation of an efficiently working market system.

2. The process of rivalry between firms striving to gain sales and make profits
3. Motive: self-interest, but outcome mostly beneficial for the society
4. Competition is not just an event, but a process
5. It is not automatic – needs to be nurtured
COMPETITION
Benefits from Competition
• Companies : Efficiency, cost-saving operations, better utilization of
resources, etc.
• The Consumer : Wider choice of goods at competitive prices
• The Government : Generates revenue BUT…………all these benefits are
lost if Competition is UNFAIR or NON-EXISTANT
• Choice of CARS in the olden days • MTNL Monopoly : The position today •
Airlines : INDIAN AIRLINES : JET : SAHARA
COMPETITION
• Types of Competition:
• Price Competition: Winning customers by lowering price
• Non-price Competition: Winning customers by advertising, offering after- sales-services, using sale
promotion tools, etc.
• Ways of Competition
• Fair Competition: Fair means such as producing quality goods, becoming cost-efficient, optimising
the use of resources, best technology, research & Development, etc.
• Unfair Competition: Unfair means such as fixing price with the rivals, predatory pricing, disparaging
or misleading advertisements, etc.
OBJECTIVES
Stated objective in preamble is to provide “for Establishment of a

Commission”.
1) Eliminate practices having adverse effect on competition

2) Promote and sustain competition in markets
3) Protect consumers interests
4) Ensure freedom of trade carried on by other participants in markets, in
India
PRACTICES RESTRICTED
• 1. Price fixing:- If two or more supplier fixes the same price for supply the goods
then it will be restricted practice.
• 2. Bid rigging:- If two or more supplier exchange sensitive information of bid, then
it will also be restricted practice and against competition.
• 3. Re-sale price fixation:- If a producer sells the goods to the distributors on the
condition that he will not sell any other price which is not fixed by producer.
• 4. Exclusive dealing:- This is also restricted practice. If a distributor purchases
the goods on the condition that supplier will not supply the goods of any other
distributor.
• Above all activities promote monopoly so under competition act these are void and
action of competition commission will not entertain by civil court
UNFAIR TRADE PRACTICES
Any trade practice whose harm outweighs its benefits. It can be

defined as using various deceptive, fraudulent or unethical methods to
obtain business.
 Unfair trade practices include misrepresentation, false advertising,
tied selling and other acts that are declared unlawful by statute. It can
also be referred to as deceptive trade practices.
 Example: A salesperson spends four hours in a consumer’s home
trying to sell a vacuum cleaner
RESTRICTIVE TRADE PRACTICES
•Any trade practice that tends to block the flow of capital into
production and also bring in conditions of delivery to affect the
flow of supplies leading to unjustified cost.
•• Example: A gas distributor insisted his customers to buy gas
stove as a condition to give gas connection. It was held that it
was a restrictive trade practice.
COMPETITION ACT
• Main Features:
• • Anticompetitive practices, (Section 3)

• • Abuse of Dominance (Section 4)
• • Mergers and Acquisitions (Section 5 & 6)
• • Competition Advocacy (Section 49)
An agreement entered into by,
Anti-Competitive or OR or
Agreements with respect to,
1. Production,
2. Supply,
3. Distribution,
4. Storage,
5. Acquisition or control of goods,
6. or provision of services,
That may cause an Appreciable Adverse Effect on the
Competition
Types of Anti-Competitive Agreements
Horizontal agreements:
1) Determine Purchase/ Sale price

2) Control Production, Supply, Tech Developments, investments etc.
3) Sharing/ Allocation of market based on geography or markets
4) Bid rigging
Vertical Agreements
Any agreement amongst

enterprises or persons, Manufacturer A Manufacturer B
1. at different stages or levels of the

production chain
2. in different markets,
3. in respect of production, supply,
distribution, storage, sale or price of or
trade in goods or provision of services
Retailer
Vertical Agreements
Tie - in Refusal to Deal
Exclusive Distribution
Exclusive Supply Re-sale Price Maintenance

Abuse of Dominance
Includes practices like:
• Unfair or discriminatory conditions or prices,
• Limiting or restricting production or technical/scientific
development,
• Denial of market access, and
• Predatory pricing(pricing product at below the cost of
manufacturing)
FACTORS TO BE CONSIDERED FOR DOMINANCE
Dominant position linked to a host of factors
 Market share of enterprise

 Size and resources of enterprise
 Size and importance of competitors
 Commercial advantage of enterprise over
competitors
 BCCI has abused its dominant position in contravention of Section 4(2)(c) of the
Act. The Competition Commission of India ("CCI") imposed fine— INR 522 million ($10
million) fine against the Board for Control of Cricket in India for an alleged abuse of
dominance.
COMBINATIONS
S.5: Combination is either:
a) Fresh acquisition
b) Such acquisition where acquirer already has control
over production, distribution of similar or identical
goods/services
c) Any merger or amalgamation
Regulation of Combinations Monetary Thresholds
Applicable to Assets Turnover
Individual Rs. 1500 Cr. Rs. 4500 Cr.

In India
Group Rs. 6000 Cr. Rs. 18,000 Cr.
Assets Turnover
Minimum Minimum
Total Total
In and Indian Indian
Ou Compone Compone
tsid nt nt
e Individual $750 Mn. Rs. 750 Cr. $2250 Mn. Rs. 2250 Cr.
Ind
ia Group $3 Bn. Rs. 750 Cr. $9 Bn. Rs. 2250 Cr.
COMPETITION ADVOCACY
• Competition Advocacy • The aim of Competition advocacy is to foster
conditions that will lead to a more competitive market structure and business
behaviour without the direct intervention of the Competition Law Authority,
namely the CCI
• • For promotion of competition advocacy and creation of awareness about
competition issues, the Commission may take suitable measures to:
• • Promote competition advocacy.
• • Create public awareness.
• • Impart training about competition
• • The Commission shall render opinion on a reference from the Central
Government on policy / law on competition. CCI is required to give opinion in
60 days
COMPETITION COMMISSION OF INDIA (CCI)
• Administrative structure: It consists of 1 chairman and 6 members
• Functions:
• 1) To prevent practices having adverse effect on competition
• 2) To promote and sustain competition
• 3) To protect the interest of consumers
• 4) To ensure freedom of trade carried by market participants in markets in India COMPAT The
Competition Appellate Tribunal (COMPAT) is a quasi-judicial body constituted under the provisions
of the Competition Act, 2002, as amended by Competition (Amendment) Act, 2007. COMPAT is
headed by a Chairperson, who shall be a serving/ retired Judge of Supreme Court of India or
serving/retired Chief Justice of a High Court or qualified to be a Judge of Supreme Court or Chief
Justice of a High Court.
COMPETITION COMMISSION OF INDIA
COMBINATIONS
Sun Pharma - Ranbaxy
Facts Findings
Sun Pharma and Ranbaxy had The Commission observed that

filed the notice with the CCI on there are horizontal overlaps
06.05.2014, in between the products of the
relation to merger. Parties
Sun Pharma - Ranbaxy
FINDINGS
• The commission held a meeting on 07.07.2014 and formed a opinion

that the proposed combination would likely cause an adverse effect on
competition in the relevant markets in India.
• The Commission noted thatvarious generic brands of a given molecule
are chemical equivalents and are considered to be
substitutable.Therefore, the molecule level would bemost appropriate
for defining relevant markets on the basis of substitutability
Sun Pharma - Ranbaxy Merger
Horizontal Overlaps
Proposals by the CCI

Sun Pharma shall divest:
All products containing Tamsulosin + Tolterodine, Leuprorelin.
Ranbaxy shall divest:

All products containing Terlipresslin, Rosuvastatin + Ezetimibe, Olanzapine +
Fluoxetine,Levosulpiride + Esomeprazole, Olmesartan+ Amlodipine
+hydroclorthiazide.
Modification(amendments) to the proposed combination:
Sun Pharma shall divest all products containing Tamsulosin + Tolterodine and
the rest products would be divestified by Ranbaxy.
Final Order
• The Commission approved the proposed mergerbetween

Sun Pharma andRanbaxy.
• TheCommission also directed that the proposed merger shall
not take effect before the Parties have carried out the
divestiture of the products.
• The combined entity would be the largest pharmaceutical
company in India and the fifth-largest generic player globally by
sales.
TYPES OF INSTRUMENT
1. Inchoate Instrument
2. Drawee in case of demand
3. Accomodation bill
4. Ambiguous Instrument
5. Inland bill:
A Negotiable Instrument made payable in India, drawn upon a person
resident in India eventhough endorsed outside India.
6. Foreign bill:
 A Instrument drawn or made in India upon person Resident outside
India and made payable outside India,
 Drawn or made outside India and payable in India
3
DISHONOUR OF A INSTRUMENT
4
NOTING AND PROTEST
NOTING SHOULD SPECIFY IN THE INSTRUMENT:
a. Fact of dishonour
b. Date of dishonour
c. Reason for such dishonour
d. Notary’s charges
e. Reference to notary’s registers
f. Notary’s initials
 Protest is a formal certificate of the notary public attesting the dishonour of
the bill by the court on proof of the protest shall presume the fact of
dishonour.
 the court on proof of the protest shall presume the fact of dishonour.
5
DISCHARGE OF A NI
6
Delivery of goods:
ACTUAL DELIVERY
SYMBOLIC DELIVERY
CONSTRUCTIVE DELIVERY
RULES AS TO DELIVERY OF GOODS:
1) Mode of delivery
2) Delivery and payment are concurrent
3) Effect of part delivery
4) Buyer to apply for delivery
5) Place of delivery
6) Time of delivery
7) Goods in possession of third party
8) Cost of delivery
9) Delivery of wrong quantity
10) Installment deliveries
11) Delivery to a carrier/wharfinger
ACCEPTANCE OF DELIVERY
RIGHTS OF BUYER:
1. Right to have delivery as per contract.
2. Right to reject the goods.
3. Right to repudiate.
4. Right to notice of insurance.
5. Right to examine.
6. Rights against seller for breach of contract.
RIGHTS OF UNPAID SELLER
Against Stoppage With

goods in transit holding
Property Stoppage
lien
passed in transit
Property
Re-sale
not passed
RIGHTS OF UNPAID SELLER
AGAINST
BUYER
PRICE DAMAGES
SUIT FOR
REPUDIATION
INTEREST
COMPANY LAW
ELEMENTS, INCORPORATION, MANAGEMENT & WINDING UP

DEFINITION
Lord Justice Lindley has defined a company as “an
association of many persons who contribute money or
money’s worth to a common stock and employ it in some trade
or business and who share the profit and loss arising there
from. The common stock so contributed is denoted in money
and is the capital of the company. The persons who
contributed in it or form it, or to whom it belongs, are members.
ELEMENTS OF A COMPANY
“A company is a voluntary association for profit with capital divisible into

transferable shares with limited liability, having a distinct corporate entity and a
common seal with perpetual succession”.
1. Corporate personality
2. Company as an artificial person
3. Company is not a citizen
4. Company has Nationality and Residence
5. Limited Liability
6. Perpetual Succession
7. Separate Property
ELEMENTS OF A COMPANY
8. Transferability of Shares
9. Capacity to Sue and Be Sued
10. Contractual Rights
11. Limitation of Action
12. Separate Management
13. Voluntary Association for Profit
14. Termination of Existence
EXCEPTIONS TO THE PRINCIPLE OF LIMITED
LIABILITY
a) Number of members below statutory minimum.

b) Unlimited Liability.
c) Fraudulent Trading
d) Defraud creditors in winding up u/s.339(1)
e) Misdescription in Prospectus.
f) Failure to repay deposit or part thereof or any interest thereon
g) Undue advantage or benefit to KMP
DIFFERENCE BETWEEN LLP AND COMPANY
1. LLP is a business form that gives the benefits of limited liability of a
company and the flexibility of a partnership.
2. LLP can continue its existence irrespective of changes in partners.
3. LLP is capable of entering into contracts and holding property in its own
name.
4. LLP is a separate legal entity, is liable to the full extent of its assets but
liability of the partners is limited to their agreed contribution in the LLP.
5. No partner is liable on account of the independent or un-authorized actions
of other partners and hence np joint liability.
DIFFERENCE BETWEEN LLP AND COMPANY
6. Mutual rights and duties of the partners within a LLP are governed by an
agreement between the partners or between the partners and the LLP as
the case may be.
7. LLP is a body corporate and a legal entity separate from its partners, having
perpetual succession.
8. Internal governance structure of a company is regulated by statute (i.e.
Companies Act) whereas for an LLP it would be by a contractual agreement
between partners.
9. LLP have lesser compliance requirements.
10. The management-ownership divide is not there in a
LLP
TYPES OF COMPANIES
TYPES OF COMPANIES
HOLDING &SUBSIDIARY
COMPANY LAW
ELEMENTS, INCORPORATION, MANAGEMENT & WINDING UP

TYPES OF DOCTRINES
1. Lifting of Corporate veil
2. Doctrine of constructive notice
3. Doctrine of indoor management
4. Doctrine of Ultra vires
5. Illegal association
6. Section 8 companies
7. Corporate social responsibility(2% of average NP3years)
 Net worth – 500crs or more
 Turnover – 1000crs or more
 Net profit – 5crs or more(any financial year)
8. One woman director
STATUTORY RECOGNITION OF LIFTING OF
CORPORATE VEIL
The Companies Act, 2013 itself contains some provisions [Sections

7(7), 251(1) and 339] which lift the corporate veil to reach the real forces
of action.
 Section 7(7) deals with punishment for incorporation of company by

furnishing false information
 Section 251(1) deals with liability for making fraudulent application for
removal of name of company from the register of companies and
 Section 339 deals with liability for fraudulent conduct of business
during the course of winding up.
Interpretation
Where a fraudulent and dishonest use is made of the legal entity, the individuals concerned will not be
allowed to take shelter behind the corporate personality
1. Where the corporate veil has been used for commission of fraud or improper conduct..
2. Where a corporate facade is really only an agency instrumentally.
3. Where the conduct conflicts with public policy
 A company will be regarded as having enemy character, if the
persons having de facto control of its affairs are resident
in an enemy country or, wherever they may be, are acting
under instructions from or on behalf of the enemy.
4. Company was formed was to evade taxes the Court will ignore the concept of separate entity.
6. Avoidance of welfare legislation.
7. Company has abused its corporate personality for an unjust and
inequitable purpose,
CONSTRUCTIVE NOTICE
Doctrine of Indoor management:
Exceptions:
1. Knowledge of irregularity(mortgage of property)
2. Negligence (a/ctant)
3. Forgery(seal of the coy)
4. Acts outside the scope of apparent authority
Promoter
• Holds fiduciary relationship:
1. Not to make secret profits
2. To give benefit of negotiations to the
company.
3. To make full disclosure of interest or profit
4. Not to make unfair use of position.
 Pre incorporation contracts
FORMATION OF THE COMPANY
MCA-21:Electronic filing of forms-

Items covered under this:
Registration and Incorporation of companies
Filing of Annual Return and balance sheet
Filing of forms for change of name/address/directors details
Regn, modification and verification of charges
Inspection of documents
Issue of certified copies
Application for permission required under various acts
Approval from central government, RD & ROC.
Investor grievance redressal.
INCORPORATION OF A COMPANY
1. Apply for Name Approval in RUN
a) Login on MCA Website
b) Details required to be mentioned in online form
c) Choose File
d) Submission of Form on MCA Website
e) Payment of Fees
f) Validity of Reserved Name
2. Preparation of Documents for Incorporation of
Company.
3. Fill the Information in Form.
4. Preparation of MOA & AOA (Electronic or Physical)
5. Fill details of PAN & TAN

6. Fill details of GST, IEC in AGILE
7. Submission of INC-32, 33, 34, AGILE on MCA
8. Certificate of Incorporation
9. Commencement of Business
File with the ROC documents
Signed by the subscribers.
Declaration by professionals
Affidavit from all subscribers
Address for correspondence
Names residential address
First directors
First directors interest in other firms
Registrar issue the certificate
Coy will have CIN No.
Documents at RO
False particulars shall be punishable.
Conclusive proof of incorporation.
MEMORANDUM OF ASSOCIATION
CONTENTS:
1. Name Clause(Except Sec 8 and government co..)
2. Situation Clause
3. Object Clause
4. Liability Clause
5. Capital Clause
6. Association/Subscribers Clause
MOA - FORM
Section 4(6) of the Act provides that the memorandum of association should be in any one of the
Forms specified in Tables A, B, C, D or E of Schedule I to the Act, as may be applicable
1. the Form in Table A is applicable in the case of companies limited by shares;
2. the Form in Table B is applicable to companies limited by guarantee not having a share capital;
3. the Form in Table C is applicable to the companies limited by guarantee having a share capital;
4. the Form in Table D is applicable to unlimited companies not having a share capital;
5. the Form in Table E is applicable to unlimited companies having a share capital.
6. A company shall adopt any of the model Forms of the memorandum of association mentioned
above, as may be applicable to it.
MEMORANDUM OF ASSOCIATION
1. Name clause
 Special Resolution, ordinary resolution+ approval of CG identical or too closely resemblance
2. Situation clause
 Board resln - within city
 Special resln + RD(state)
 Special resln + CG( outside state)
3. Objects clause
 Special Resolution
4. Capital clause
 reduce share capital by first passing a special resolution for reduction of capital
5. Liability clause
6. Association/subscribers clause
ARTICLES OF ASSOCIATION
Contents of the Articles:
1. Exclusion wholly or in part of Table F.

2. Adoption of preliminary contracts.
3. Share Capital, variation of rights, Number and value of shares.
4. Issue of preference shares.
5. Allotment of shares.
6. Calls on shares.
7. Lien on shares.
8. Transfer and transmission of shares.
9. Nomination.
10.Forfeiture of shares.
11.Alteration of capital.
12.Buy back.
13.Share certificates.
14.Dematerialisation.
15.Conversion of shares into stock.
16.Voting rights and proxies.
17.Meetings and rules regarding committees of the Board.
ARTICLES OF ASSOCIATION
17. Dividends & reserves
18. Accounts, winding up &Indemnity.
18.Directors, their appointment and delegations of powers.
19.Nominee directors.
20.Issue of Debentures and stocks.
21.Audit committee.
22.Managing director, Whole-time director, Manager, Secretary, Chief Executive Officer and Chief Financial Officer.
23.Additional directors.
24.Seal.
25.Remuneration of directors.
26.General meetings, proceedings at general meetings, adjournment of meeting.
27.Board of Directors, Proceedings of the Board meetings.
28.Borrowing powers.
29.Dividends and reserves.
30.Accounts and audit.
31.Winding up.
32.Indemnity.
33.Capitalisation of profits, reserves.
34.Secrecy
TYPES OF MEETINGS
1. Statutory meeting
2. Board meetings
3. Annual general meetings
4. Ordinary Business:
• Consideration and adoption of accounts
• Declaration of dividends
• Appointment of directors by rotation
• Appointment of auditors and remuneration
5. Extraordinary general meetings.
 Special resolution
 Ordinary resolution
 Proxy
 Quorum pub:5 pvt:2
 Minutes book
MANAGEMENT OF THE COMPANY
Annual Return:
Every Company shall Prepare an AR containing the following:
1. Its RO, principal place of business, particulars of Holding, subsidiary and associate
companies.
2. Its shares, debentures and other shareholders pattern
3. Members and debenture holders along with charges
4. indebtedness
5. Its Promoters, directors and key managerial personnel
6. Meetings of members, board
7. Remuneration of directors
8. Certification and compliance
9. Shares held by FII’s
DIRECTORS
1. “Director” means a director appointed to the Board Of a Company .
2. “Board of Directors” or “Board” in relation to a company means the collective
body of the directors of a company
3. “Managing director”- Director by virtue of articles/agreement/shareholders’s
resolution
- Entrusted with the substantial powers of management of the company
- Includes a director occupying the position of Managing director, by whatever
name
4. “Whole time Director” includes a director in the whole-time employment of the
company.
TYPES OF DIRECTORS
• Alternate director: can only be appointed in case a director leaves India for a
period of not less than 3 months
• Subject to articles, Board can appoint director nominated by any institution in
pursuance of any law or agreement
• Subject to articles, the board may appoint any person, other than the person
who fails to get appointed as a director in a general meeting as an additional
director.
• Listed public company have at least 1/3rd of the total number of directors as
independent directors
• At least 1 woman director for prescribed class or classes of companies
TYPES OF DIRECTORS
Whole time director: Conditions:
It is a listed company whose securities are listed on any stock exchange
It is a company having paid-up capital of rupees one hundred crore or more, and a turnover of
rupees three hundred crores or more.
At least 1 director shall be a person who has stayed in India for at least 180 days in the previous
calendar year
The maximum limit of directors in the company has been increased to 15 from 12. Beyond 15, the
number can be increased by special resolution; approval of central government has been dispensed
with
A person cannot become a director in more than 20 companies. Out of this 20, he cannot be a
director of more than 10 public companies
Listed companies may have 1 director elected by small shareholders
The amount to be deposited along with notice of nomination of any person to the office of director
has been increased from rupees 500 to rupees 100,000 or such higher amount as may be
prescribed
INDEPENDENT DIRECTOR
Appointment of independent directors - board shall give
a declaration for satisfaction of appointment conditions
and criteria.
Limited liability of independent directors- Liability only for

such acts of omission or commission by a company
which had occurred with his knowledge, attributable
through board processes, and with his consent or
connivance or where he had not acted diligently.
23
BOARD MEETINGS
First Board Meeting should be held within 30 days of the
Incorporation
A notice of not less than seven days in writing is required to call
a board meeting
Notice of Board meeting shall be given to all Directors, whether
they are in India or outside India by hand delivery or by post or
by electronic means
A Director can participate in the Board meeting through video
conferencing or other audio visual mode as may be prescribed
At least 4 Board meetings should be held each year, with a gap of
not more than 120 days between two Board meetings
Resolution by circulation shall be consented to by majority of
Directors present in India
24
CHAIRMAN- N.E.D&
CHAIRMAN- E.D CHAIRMAN- N.E.D PROMOTERS/RELATIVE OF
Min 50% I.D Min 1/3RD I.D PROMOTER
Min 50% I.D
COMMITTEE MEETINGS
Nomination and remuneration committee:
For listed and other prescribed class of companies 3 or more non- executive
directors out of which not less than one half shall be independent directors
Stakeholders and Relationship committee:
For company which consists of more than one thousand shareholders, debenture-
holders, deposit-holders and any security holders at any time during a financial year
chairperson who shall be non-executive director and such other members as may
be decided by the board
Audit committee:
For listed and other prescribed class of Companies audit committee shall not consist
of 3 or more non-executive directors out of which not less than one half shall be
independent of directors
Corporate social responsibility committee shall consist of three or more directors out
of which one shall be an independent director
PROSPECTUS
Prospectus is a detailed statement of the company affairs which is
issued by a company for its public.
Private limited company - no issue of Prospectus because public is not
invited to subscribe for the shares of the company.
Name: It is mandatory for all the private companies to use the world
private limited after its name
TYPES OF SHARE CAPITAL
1. Authorised Capital
 Issued Capital
 Subscribed Capital
 Called up Capital
 Paid up capital
2. Shares
I. Equity Shares
II. Preference shares
3. Debentures
4. Bonds
5. Fixed Deposits
WINDING UP
Winding up is the method of ending, or dissolving, a business.
Winding up includes:
Selling all assets
Paying off creditors, and
Distributing remaining assets to the shareholders.
Indian Partnership Act
1932
Parisha Agarwal 20020844020
Mohamed Noufal Buhari 20020844017
Shruti Nigam 20020844030
Sanket Tripathi 20020844026
Indian Partnership Act 1932
The Indian Partnership Act 1932 defines a partnership as a relation between two or more
persons who agree to share the profits of a business run by them all or by any one person Features
acting for all of them.
1).Legal Status
2).Agency Relationship
3). Profit Sharing
Eligibility Benefits of Partnership 4). Extent of Liability
Firm registration 5). Transfer of Shares
➢ Person should be of the age of ➢ Ability to file case against Third
6). Property
majority according to the law to Parties.
7). Minor’s Capacity
which he is subject.
➢ Power to file suit against co- 8). Registration
➢ Person should be of sound mind. partners. 9).Winding up
➢ Person is not otherwise disqualified ➢ Ability to claim Set-off. 10).No. of membership
from contracting by any law to
➢ Higher credibility.
which he is subject to.
Your Logo or Name Here
➢ Conversion of Entity.
FEATURES
Legal Status: A firm is not legal entity; It has no
legal personality distinct from the personalities of
its constituent members.
Agency: In a firm ,every partner is an agent of the
other partners, as well as of the firm.
Profit Sharing: Distributed according to the terms
of the partnership deed.
Extent of Liability: The liability of the partners in
a partnership is unlimited.
{ Transfer of Shares: A share in a partnership
cannot be transferred without the consent of all the
partners.
Property: The firm’s property is that which is the
“joint estate” of all the partners as distinguished
from the “separate” estate of any of them and it
doesn’t belong to a body distinct in law from its
members.
Registration: Not Compulsory.
Winding up: Partnership firm can be dissolved at
any time if all the partners agree.
FEATURES Continued….
Minor’s Capacity: In a partnership, a minor cannot

become a partner, though he can be admitted to
the benefits of a partnership , Only with the
consent of all the partners.
Membership: According to section 464 of the

Companies Act , 2013 , the number of partners in
any association shall not exceed 100 .
{
However, the rule given under the companies
Rules, 2014 restrict the present limit to 50.
In case of HUF(Hindu Undivided Family) members
of HUF who carry on business may be unlimited in
number.

Provisions
Section 44 – Dissolution by the court
Section 11 – Determination of rights and duties of

partners
Section 12 – The conduct of the business
Section 30 – Minors admitted to the benefits of

partnership

Dissolution by the court
The court can dissolve a company in the case of a partner for any of the following
reason.
• If a partner becomes insane or of an unsound mind, and other partners
files a suit in the court, then it can lead to dissolution. The partner should
not be a sleeping partner and the sickness should be permanent.
• If a partner is permanently unable to fulfil his duties.
• If a partner files a suit against another partner who is guilty of conduct that
affects the working of the business, then the court can dissolve the
company.
• A partner may deliberately or persistently commit an infringement of an

agreement relating to management of firm’s affairs or to the appropriate
conduct of the business or matters which are not reasonably feasible for
other partners to conduct business in partnership with him. In such cases,
if other partners files a suit, the court may order to dissolve
Your the firm
Logo or Name Here
Determination of rights and duties of partners by contract
between the partners
The court can dissolve a company in the case of a partner for any of the following reason.
• The shared rights and responsibilities of the partners of a business may be determined by a contract between the
partners subject to provision of this Act. Such a contract can or may be inferred by a dealer’s course of action. It can be
varied by consent of all the partners or it can be implied by course of dealing.
• The partner shall not whilst he is a partner, carry on any business other than that of the firm while is a partner.
The conduct of the business

• All the partners has the right to engage in the conduct of the business.
• Partners are obliged to attend to his duties in the conduct of the business.
• Majority of the partners will decide on any differences arising from ordinary business related matters and each partner
shall have the right to express his opinion before the matter is decided. No change in the nature of the business shall be
made without the agreement of all the partners. Your Logo or Name Here
Minors in Partnership
The court can dissolve a company in the case of a partner for any of the following
reason.
• An individual who is a minor to the law under which he cannot be a
partner in a firm, but maybe entitled to the benefits of partnership for the
time being with the consent of all the other partners.
• They have the tight to such share of the company’s property and income as
may be agreed upon, and may have access to all the company’s accounts
and may inspect and copy them.
• A minor is not personally liable to debts, but his liability if limited only upto
his shares in the assets and profits. For example, If the partnership assets
fall short due to debt, personal properties of minor cannot be used to pay
the debts.

Partnership Deed
Essentials of Partnership Deed
• Name of the partnership firm.
• Names of all the partners
• Nature and place of the business of the firm
• Date of commencement of partnership
• Duration of partnership
{ • Capital contributed by each partner
• Profit sharing ratio among each partner
• Admission and retirement of partner
• Traits of interest on capitals , drawings and loans.
• Provision for settlement of accounts in the case of
dissolution of the firm.
• Provision of salaries or commission payable to the
partners, if any.
• Provisions for expulsion of the partner in case of gross
breach of duty or fraud. Your Logo or Name Here
Kinds of
Partnership
With regard With regard to extent

to duration of the business
Kinds of
Partnership
Partnership Partnership
at Will for a fixed Particular General
period Partnership Partnership

Kinds of Partnership Explained::
1. Partnership at will:
• no fixed period has been agreed upon for the duration of the partnership;
and
• There is no provision made as to the determination of the partnership.
2.Partnership for a fixed Period:
• When a provision is made by contract for the duration of the partnership.
• For a particular period of time.
• Comes to an end on the expiry of the fixed period.
3. Particular Partnership:
• A partnership may be organized for the prosecution of a single adventure as
well as for the conduct of a continuous business.
• Where a person becomes a partner in any particular adventure or
undertaking.
• Subject to any agreement , dissolved by the completion of the adventure or
undertaking.
4. General Partnership:
• Constituted with respect to the business in general.
• Unlike Particular partnership , the liability of the partners does not extends
only to that particular adventure or Your
undertaking.
Logo or Name Here
Active or Outgoing
Ostensible Partner
Sleeping or
Dormant
Nominal
Sub- Types of Partners
Partner
Partner by
Holding
Out
Partner in Incoming
Profits only Partner

Active or Actual or Ostensible Partner Sleeping or Dormant Partner
Who has become a

partner by
Who is a partner by
agreement , and
agreement , and
It is a person
It is a person
Who doesn’t
Who actively
actively participates
participates in the
in the conduct of
conduct of the
the partnership.
partnership.

Nominal Partner::
Lends his name Without having any Not entitled to

to the firm real interest in firm share the profits
Doesn’t take part in Liable to third

the conduct of the parties for all acts of
business the firm.
Partner in Profits Only:::

Types of Partners
Entitled to share Not liable for the

the profits only losses
Liable to third
parties for all acts of
the profits only.

To be represented
Partner by Holding Out:: Knowingly permits as a partner in a
himself , firm(when in fact
he is not)
To anyone who on the

When a person He is liable , like a faith of such
represents himself, or partner in the firm representation has given
credit to the firm
Incoming Partners::
Types of
A person who is admitted as a partners into an already existing firm with the
consent of all the existing partners is called as “incoming partner”.
Partners
Such a partner is not liable for any act of the firm done before his admission as a
partner.
Outgoing Partners::
A partner who leaves a firm in which the rest of the partners continue to carry on
business is called a retiring or outgoing partner. Such a partner remains liable to
the third parties for all acts of the firm until public notice is given for his
retirement.
Overview : Santiranjan Das Gupta Vs Dasuram Murzamull
Date :24 August 1972
Court : Supreme Court
Case Covered
Parties Involved
Plaintiff : Santiranjan Das Gupta
Defendant: Dasuram Murzamull

Case Detail
• The partnership business commenced from about the middle of January, 1948 and the work continued up to 10th
September, 1948.
• On or about November 6, 1948 Murzamull Agarwal told the plaintiff that the business in partnership was no longer
possible.
• According to Shri Nag, the learned Counsel for the appellant the partnership was oral and was entered into some time on
or about January 10, 1948. We have on the record a written agreement between the parties dated January 11, 1948, This
agreement purports to be a milling hire arrangement between Santi Ranjan Das Gupta, proprietor of Das Gupta Rice Mills,
Nojai Nowgong (plaintiff-appellant) and Messrs Dasuram Murzamull of Gauhati (defendants-respondents).
• On appeal the High Court in a fairly detailed and exhaustive judgment came to the conclusion that there was no partnership
between the parties and dismissed the plaintiffs suit.

Judgement
Conclusion: There is no partnership between
the parties
Factor Leading to Conclusion

• Parties haven’t retained any record of terms and
conditions of partnership.
• Partnership business has maintained no accounts of it’s
own, which would be open to inspection by both the
parties.
• No account of partnership was opened by any banks.
• No written intimation was conveyed to the deputy
Director of procurement with respect to the newly
created partnership.

• We find no reason to disagree with the view of the court. The
appeal accordingly fails and is dismissed with costs.
• There was no reliable evidence on which the existence of the
partnership could be established and hence the court ruled in
favor of the defender.
• According to the court, the partnership was oral and they
entered into an agreement because of the plaintiff could not
run the business himself.
• It was merely a paper transaction (which is also a written
agreement but not of partnership) to help the plaintiff as he
was not financially stable.
• Defendant entered into partnership with plaintiff when he was
Our Opinion the sole proprietor of the firm, but without any written
agreement, the partnership diluted when defendant and his
staff left the firm when plaintiff was not in place.
• These circumstances according to the learned counsel
suggests that there were no written or valid proof.
• So, we came to a conclusion that the judgement was made
after detailed and exhaustive consideration of the case.
Thank You

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THE PATENT ACT OF 1970

INTELLECTUAL PROPERTY RIGHTS

process machine manufacture

If you create a new and original design that ornaments a

Protect words, names, symbols ,sounds , or colours that

GI in relation to goods means an indication which identifies such

Email and Internet related crimes:

 Most important asset of software companies “Computer

Source code - imprisonment up to three years and /

ab initio From the beginning.

ad hoc Not intended to be able to be adapted to other purposes.

ad idem To the same thing.

ad valorem According to value.

alter ego A second identity living within a person.

amicus curiae Friend of the court.

audi alteram partem Hear the other side.

bona fide In good faith.

dehors Outside of.

ex gratia As a matter of grace or favour.

ex officio By virtue of an office.

fait accompli An accomplished act.

actus reus Guilty act.

in personam Against the person.

in rem An act/proceeding done or directed with reference to no specific person or with

inter alia Amongst other things.

inter vivos Between living persons.

intra vires Within the powers.

ipso jure By the law itself.

lis pendens A pending suit.

locus standi Signifies a right to be heard.

mens rea A guilty mind.

pendente lite During litigation.

ratio decidendi Reasons for deciding, the grounds of decision.

res judicata A case or suit already decided.

sine die Without day.

status quo Existing condition.

sub judice Before a judge or court, pending decision of a competent count.

ultra vires Beyond one’s powers.

INTRO TO LEGAL SYSTEMS AND CONCEPTS

• By requiring damages to be paid for an injury due to disobedience

• By requiring one, in some instances, to complete an obligation he has failed to perform

Business law establishes a set of rules and prescribes

1. System of double government

1. System of double government

However, it does not mean that every statement in a judgement

English decisions have only persuasive value in India. The

The Indian Constitution empowers the Supreme Court

1. Writ of habeas Corpus.

Email and Internet related crimes:

❖ Most important asset of software companies “Computer

Source code - imprisonment up to three years and /

INDIAN CONTRACT ACT

LEGAL OBLIGATION: A duty enforceable by law.

Any agreement which is void abinitio is not valid.

• An agreement not enforceable by law is said to be void. Thus a void

• A contract cannot be void abinitio. Only an agreement can be void

• An Contract which is valid in itself, but is not capable of being

 Implied Contract: Where the contract is made otherwise

 Constructive or quasi Contract: No express or implied

 Executed Contract: Where both the parties have

INDIAN CONTRACT ACT

1. Agreement is expressed, in writing & registered and made out of

• Mistakes of law Mistakes of fact