Question 1

A resolution shall be a special resolution when the votes cast in favour of the resolution by members are not less than ________ the number of votes, if any, cast against the resolution:

Accepted Answer

**Answer: (B) Three times**

Under Section 114 of the Companies Act, 2013, a special resolution requires that the votes cast in favor of the resolution by members present and voting shall be **not less than three-fourths** of the total votes cast. Mathematically, if votes in favor = V_f and votes against = V_a, then: V_f ≥ (3/4) × (V_f + V_a). Simplifying: V_f - (3/4)V_f ≥ (3/4)V_a, which gives (1/4)V_f ≥ (3/4)V_a, or **V_f ≥ 3V_a**. Thus, votes in favor must be at least three times the votes cast against. Example: if total votes are 100, votes in favor must be ≥ 75, leaving at most 25 against; 75 ÷ 25 = 3.

Question 2

A negotiable instrument drawn in favour of a minor is:

Accepted Answer

**Answer: (C)**

A negotiable instrument drawn in favour of a minor is **valid**. Under the Negotiable Instruments Act, 1881, a minor can be named as the payee and can receive and hold a negotiable instrument. The validity of the instrument is not affected by the fact that the payee is a minor. However, while the instrument itself is valid, the minor's capacity to further negotiate or enforce the instrument may be limited by general principles of contract law (Indian Contract Act, 1872), as a minor lacks contractual capacity. The instrument is not void ab initio, nor is it enforceable only if void—it is simply valid as a negotiable instrument, though the minor's ability to exercise certain rights may be restricted.

Question 3

Dividend once declared, should be paid within_____________ days from the date of declaration.

Accepted Answer

**Answer: (C)**

According to **Section 127 of the Companies Act, 2013**, every company shall pay any dividend due on shares within **30 days** from the date of declaration or within 30 days from the date on which it becomes due and payable, whichever is later. This 30-day period is a mandatory compliance requirement to ensure timely disbursement of shareholder dividends.

Question 4

ABC Limited has its shares listed on a recognized stock exchange in India. During the current financial year ending on 31st March 2023, the Securities and Exchange Board of India (SEBI) has found some irregularities in the filings made by the company. Accordingly, SEBI proposes to make an application to the Tribunal for reopening of the books of accounts of the Company. You, as an expert, are called upon by SEBI to advise with which last financial year for reopening of books of accounts an application can be made?

Accepted Answer

**Answer: (D)**

Section 392 of the Companies Act, 2013 empowers the Tribunal to reopen the books of accounts of a company if satisfied that the books do not show the true and correct state of affairs and necessary corrections cannot be made without reopening them. However, the Tribunal may reopen the books **for a period not exceeding ten years from the end of the relevant financial year**.

Given that the current financial year ends on 31st March 2023, counting back 10 years brings us to 31st March 2013, which is the end of financial year 2012-2013. Therefore, SEBI can apply for reopening of books for any year up to and including 2012-2013. The financial year 2011-2012 (ending 31st March 2012) falls outside the 10-year limitation period and cannot be reopened.

Question 5

The auditor of a Government Company shall be appointed or re-appointed by:

Accepted Answer

**Answer: (C)** Central Government on the advice of Comptroller and Auditor General of India. Section 139(6) of the Companies Act, 2013 specifically provides that in case of a Government company, the auditor shall be appointed or re-appointed by the Central Government on the advice of the Comptroller and Auditor General of India. This dual mechanism ensures both governmental authority and independent audit oversight in public sector entities.

Question 6

When there is a conflict between two or more statues or two or more parts of a statute then which rule is applicable:

Accepted Answer

**Answer: (C)**

When there is a conflict between two or more statutes or two or more parts of a statute, the **harmonious construction** rule is applicable. This principle requires that conflicting provisions be interpreted in a manner that allows both to co-exist and operate together effectively, without one provision rendering the other meaningless or nugatory. The courts attempt to find an interpretation that gives effect to all provisions. If genuine harmonious construction is impossible, the doctrine of implied repeal may apply, where a later statute supersedes an earlier one to the extent of the conflict.

CA Inter Corp Laws

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