Introduction To

Legal Aspects of
Business
 In Mans association with people
in different capacities, he is
expected to observe a code of
conduct or a set of rules.
The objective of these rules is to
make human association
possible & conducive for the
welfare of the state & its people
 LAW IS A GENERAL TERM:
Citizen : rules to obey
Lawyer: vocation
Legislator: rules which he
has created
Judge: guiding principles to
apply to decision.
 Since it is not possible to
give a single accurate
definition, the term law is
preceded by an adjective
e.g. Civil Law, Criminal Law,
Mercantile Law
Law includes all the rules
and principles which
regulate our relation with
other individuals and with
 State regulates the
conduct of its people by
a set of rules.
Such rules of conduct, if
recognised by the State
and enforced by it on
people is termed as Law.
IS LAW STATIC?
Law is not static. As
circumstances & conditions in
a society change, laws are
changed to fit the
requirements of the society. As
such, law prevailing in a
society at any point of time
must be in conformity with the
general sentiments, customs &
aspirations of its people.
OBJECT OF LAW

Object of law is order; result of

order is that men are enabled to
look ahead with some sort of
security as to the future.
In the Indian Context it is to
establish Socio - Economic
Justice and remove existing
imbalance in the socio-
economic structure.
NEED FOR THE
KNOWLEDGE OF LAW

IGNORENTIA JURIS NON

EXCUSAT
(IGNORANCE OF LAW IS
NOT AN EXCUSE)
NEED FOR THE
KNOWLEDGE OF LAW

A businessman should be
aware of legal principles so
as to help him in avoiding
conflict with the persons
with whom he comes into
business contact.
SOURCES OF LAW
(With respect to Mercantile
Law)
THE ENGLISH MERCANTILE LAW
Customs, usage and tradition
Decisions of Judges in similar
situations
Act of parliament
Laws prevailing among traders
Roman law..
SOURCES OF LAW
(With respect to Mercantile
Law)
LAW ENACTED BY PARLIAMENT
OR STATE LEGISLATURE
PRECEDENTS SET BY
PREVIOUS JUDICIAL DECISIONS
CUSTOMS AND USAGE
Ubi Jus Ibi Remedium
Ubi Jus Ibi Remedium is a Latin legal maxim
which means "where there is a right there is
a remedy".
The basic principle contemplated in the
maxim is that, when a person's right is
violated the victim will have an equitable
remedy under law.
The maxim also states that the person whose
right is being infringed has a right to
enforce the infringed right through any
action before a court.
All law courts are also guided with the same
principle of Ubi Jus Ibi Remedium.
Jurisdiction of courts
Jurisdiction means the power,
right and authority to interpret
and apply law.
There are various types of
jurisdiction, but the broadest
categories are appellate
jurisdiction (the right to hear a
case on appeal from another
court) and original jurisdiction,
(the right to hear the case as the
Jurisdiction of courts
Both are related to subject-matter
jurisdiction which determines the
type of case (subject) a court may hear
and personal jurisdiction, that
determines the entities whose cases
the court may judge, as opposed to
territorial jurisdiction, which covers
the physical area over which the court
has authority. And then there is the
pecuniary jurisdiction (amount of
claim).
Civil Law vs Criminal Law
Civil Law Criminal Law
Definition: Civil law deals with Criminal law (also
the disputes known as penal law)
between is the body of
individuals, statutory and
organizations, or common law that
between the two, in deals with crime
which compensation and the legal
is awarded to the punishment of
victim. criminal offenses.
Burden of proof: "Preponderance of "Beyond a
evidence" Burden of reasonable doubt":
proof is initially on Burden of proof is
the plaintiff and always on the
then switches to the state/government.
defendants.
Civil Law vs Criminal Law
Civil Law Criminal Law
Examples: Landlord/tenant Theft (by deception
disputes, divorce or unlawful taking),
proceedings, child assault, robbery,
custody trafficking in
proceedings, controlled
property disputes substances, etc.
(real estate or
material), etc.
Type of punishment: A defendant in civil A guilty defendant
litigation is never is punished by
incarcerated and either incarceration
never executed. in a jail or fine paid
Losing defendant in to the government,
civil litigation only or, in exceptional
reimburses the cases, the death
plaintiff for losses penalty. Defendant
caused by the can be found guilty
defendants or not.
behavior. Either
party (plaintiff or
Civil Law vs Criminal Law
Civil Law Criminal Law
Case filed by: Private party Government

Appeal: Either party may Only the defendant

appeal a decision in may appeal a court
a civil suit. ruling in a criminal
case. The
prosecution cannot
appeal if the
defendant is found
not guilty.

Note: The distinction between civil and criminal law cannot always
be maintained because some acts are considered both as crimes as well
as civil wrongs.
Locus standi
In law, standing or locus
standi is the term for the
ability of a party to
demonstrate to the court
sufficient connection to and
harm from the law or action
challenged to support that
party's participation in the
case.
Public Interest Litigation
In Indian law, public interest litigation
means litigation for the protection
of the public interest.
It is litigation introduced in a court of
law, not by the aggrieved party but by
the court itself or by any other private
party.
It is not necessary, for the exercise of
the courts jurisdiction, that the person
who is the victim of the violation of his
or her right should personally approach
the court.
Public Interest Litigation
Public interest litigation is the power
given to the public by courts through
judicial activism.
The seeds of the concept of public interest litigation
were initially sown in India by Krishna Iyer J., in 1976 in
Mumbai Kamagar Sabha vs. Abdul ThaiMumbai
Kamagar Sabha vs. Abdul Thai (Trade Union was
allowed to file a case even though it had no locus
standi)
However, the person filing the petition
must prove to the satisfaction of the
court that the petition is being filed for
a public interest and not just as a
Public Interest Litigation
Such cases may occur when the victim
does not have the necessary resources
to commence litigation or his freedom
to move court has been suppressed or
encroached upon.
The court can itself take cognizance of
the matter and proceed suo motu or
cases can commence on the
petition of any public-spirited
individual.
Law of Limitation
The 'Law of Limitation' prescribes the time-
limit for different suits within, which an
aggrieved person can approach the court for
redress or justice.
The suit, if filed after the exploration of time-
limit, is struck by the law of limitation.
It's basically meant to indirectly punish
persons who go into a long slumber over
their rights.
The statutory law was established in stages.
The very first Limitation Act was enacted for
all courts in India in 1859. And finally took the
form of Limitation Act in 1963.
Equality before law
Article 14 in The Constitution Of
India 1949
The State shall not deny to any person
equality before the law or the equal
protection of the laws within the
territory of India (Prohibition of
discrimination on grounds of religion,
race, caste, sex or place of birth.)
Principle of Natural Justice
In India there is no statute laying down
the minimum procedure which
administrative agencies must follow
while exercising decision-making powers.
This minimum fair procedure refers to the
principles of natural justice.
Natural justice is a concept of common
law and represents higher procedural
principles developed by the courts, which
every judicial, quasi-judicial and
administrative agency must follow while
taking any decision adversely affecting
the rights of a private individual.
Principle of Natural Justice
The principle of natural justice
encompasses following two rules: -
Nemo judex in causa sua - No one
should be made a judge in his own
cause or the rule against bias.
Audi alteram partem - Hear the
other party or the rule of fair
hearing or the rule that no one
should be condemned unheard.
(Natural Justice is another name of
common-sense Justice)
Rule of bias
PERSONAL BIAS:
When there is a face off between a deciding or
authoritative party and someone who is either on
his side or against him, there occurs something
called personal bias that may either be positive or
negative in its effect.
This sort of bias is characteristic of judge-
witness, prosecutor-judge, and judge-
witness-prosecutor combinations.
An illustration would be Mineral Development
Corporation Ltd. V State of Bihar, the Court
quashed the Governments notification that
cancelled the petitioners mining license as there
was political rivalry between the minister and the
petitioners in a previous criminal case.
Rule of bias
PECUNIARY BIAS:
When an adjudicating body has any
financial interest, even to a very paltry
extent, its decision would be subject to
the suspicion of pecuniary bias.
Rule of bias
OFFICIAL BIAS:
The subject of this project, official bias, has often
emerged as a matter of dispute in many cases
both in India and other countries as well. Official
bias is, in most cases, characteristic of disputes in
administrative activities, where the judging
authority has sizeable interest in the
prosecution.
Gullapalli Nagesh Rao v APSRTC, where the
government nationalised road transport. The
contention of bias was rooted on the fact that the
Secretary of Road Transport Department who
heard the matter was biased as he was in charge
of commencing the scheme as well as adjudging
its prudence.
Rule of bias
PREJUDGMENT OF ISSUES:
A person who made a prior statement on the
subject matter can not be a judge on disputes on
the same subject matter.
COMPONENTS OF RIGHT
TO FAIR HEARING.
Right to notice.
Time, place and nature of hearing.
Legal authority under which hearing
is to be held.
Statements of specific charges which
the person has to meet.
Right to know the evidence against
him.
Right to present case and evidence.
Right to cross-examination.
Right to counsel.
Some Exceptions to
the Rule of Right to
be Heard.
Some exceptions to the rule of fair
hearing as recognised by courts are as
follows.
Public Interest: - Where defence and
state secrets are involved.
Emergency: Urgency is pleaded as an
excuse for not complying the principles
of Natural Justice.
Some Exceptions to
the Rule of Right to
be Heard.
Impracticability: In extreme
situations it may highly impracticable
to comply the rules. In Radha Krishna
V. Osmaina University (AIR 1974)
the decision of the university cancelling
the entire MBA examination on the
reason of mass copying with out
hearing students held valid.
Principle of Natural Justice
The other principle which have
been stated to constitute
elements of Natural Justice are
The Court / Tribunal must act
honestly and impartially and not
under the dictation of other persons
to whom authority is not given by
Law.
Thank you!