Contract Act_Practical Problems_100

A, who was a tailor, delivered a sewing machine and some cloth to B Transport Co. to be sent to a place where he expected to carry on his business at high profit by reason of a forthcoming festival. Through the fault of B Transport Co. goods were delayed and delivered much after the conclusion of the festival. A had not given any notice to B. Transport Co. of his special purpose. A claims as damages the expenses of traveling upto the place of festival and of staying there and loss of profits which he would have earned. Discuss the principles applicable for measure of damages in this case.

Contract Act_Practical Problems_99

Because of disagreements, quarrels and disputes between an old father and his modern young son, father by written agreement duly attested by Notary promises to pay Rs. 15000/- p.m. to his son for living separately. Do the following facts create contractual obligations ?

Contract Act_Practical Problems_98

A is the owner of a farm house in Delhi known as Bumper Farms. B being interested

in purchasing the same sent a telegram to A, “Will you sell me Bumper Farms? Telegraph the lowest case price.” A in reply telegraphed. “Lowest price for Bumper Farms Rs. 25 crores.” B sent another telegram to A saying, I agree to buy Bumper Farms for Rs. 25 crores.” Whether exchange of telegraphs create the contract ? Why ?

Bonus Act_Practical Problems_35

Skypark Wooden Toys Limited was established at Kolkata in the year 2005 employing 5 100 workmen. Since then the company suffered the losses, but minimum bonus was paid in the accounting years of 2006 and 2007. In the accounting year 2008 the company earned huge profits. After mitigating the previous losses the company is having surplus profits and wants to pay the bonus to its workmen. Skypark Wooden Toys Limited wants the legal advice on the following issues :

(a) How much minimum and maximum bonus may be paid to the workmen ?

(b) Whether the company may adjust the puja bonus already paid to the workmen while calculating the amount of bonus payable to workmen of that accounting year.

(c) Company wants to give wooden toys as bonus instead in cash. Whether the Company can do so ?

Advice the Skypark Wooden Toys Limited, stating the provisions of the Payment of Bonus Act, 1965.

(a) Payment of minimum bonus and maximum bonus : -

Every employer shall be bound to pay to every employee in respect of every accounting year, minimum bonus which shall be 8.33% of the salary or wages earned by the employee during the accounting year or Rs.100, whichever is higher whether or not the employer has any allocable surplus in the accounting year. But if the employee has not completed 15 years of age at the beginning of the accounting year he will be entitled to a maximum bonus which shall be 8.33% of the salary or wage during the accounting year Rs.60, whichever is higher. In view of much minimum bonus, be bound to pay to every employee in respect of that accounting year bonus which shall be an amount in proportion to the salary or wage earned by the employee during the accounting year subject to a maximum 20% of such salary or wage.

(b) As per 17 of payment of bonus act, 1965, if in an accounting year, an employer has paid any pooja bonus or other customary bonus to employee or has paid a part of bonus payable under the act before the date on which such bonus becomes payable, the employer may deduct this amount from the final bonus payable. But the amount may be deducted only from the bonus of that accounting year.

(c) Section 19 says that all amounts payable to employee shall be paid in cash no bonus shall be paid to employees in the form other than cash. Hence, company can’t give wooden lays as bonus instead of cash.

Companies Act_Practical Problems_87

The articles of ABC Limited provided that only those shareholders would be entitled to vote whose names have been there on the Register of Members for two months before the date of the meeting. X, a member, of the ABC Limited was holding 200 equity shares of the company. X transferred his shares to Y before one month from the date on which the meeting was due. The name of Y could not be entered in the Register of Members as the application of transfer of shares was pending. X attended the meeting but he was prohibited by the company from exercising his voting right on the ground that he has not hold his shares for specified period as provided in the articles before the date of the meeting. State whether X can exercise his voting right in the meeting ? State also the grounds upon which X may be excluded from exercising his voting rights in the meeting of the shareholders.

According to provision of companies Act, 1956. A member of a company has no voting right unless he actually acquires shares. A person becomes member only when his name is entered in register of member of the company. Till then, he is only holder.
In case of transfer of share, transfer is entitled to vote when his name is entered into register of member. The case is, X transfer his shares to y before one month from the date on which meeting was done and name of y is not entered is the register of member as the application of transfer of share is pending. Article of company provided that only there shareholders would be entitled to vote whose names have been there on register of members for two month of the above. Since transfer of shares procedure is pending and the name of y is not entered into register of member. Hence y is neither a shareholder nor he has right to vote. And x can exercise his voting right in the meeting as his name has not been struck off from register of member.
But if transfer process is complete and x name is struck off from company’s register of member than he is excluded from the voting right.

Contract Act_Practical Problems_97

A, the bailor, pledges cinema projector and other accessories with Cine Association Co-operative Bank Limited, the bailee, for loan. A requests the bank to allow the pledged goods to remain in his possession and promises to hold the same in trust for the bailee and also further promises to handover the possession of the same to the bank whenever demanded. Examining the provisions of Indian Contract Act, 1872 decide, whether a valid contract of pledge has been made between A, the bailor and Bank, the bailee ?

Where a mercantile agent is, with the consent of the owner, in possession of goods or the documents of title to goods, any pledge made by him, when acting in the ordinary course of business of a mercantile agent, shall be as valid as if he were expressly authorized by the owner of the goods to make the same; provided that the pawnee acts acts in good faith and has not at the time of the pledge notice that the pawnor has no authority to pledge. As per the provisions above it is clearly evident that contract made between A & Bank is valid.

SEBI Guideline_Practical Problems_1

The Balance Sheet of Get Well Soon Ltd. as at 31.3.2009 disclosed the following details:
(i) Authorized share capital Rs. 400 crores
(ii) Paid up share capital Rs. 150 crores
(iii) Reserves and surplus Rs. 750 crores
The company has issued in the year 2004, Fully Convertible Debentures of Rs. 100 crores which are due for conversion in the year 2009. The company proposes, after conversion of Debentures to issue Bonus shares in the ratio of 1 1. Explain briefly the requirements of the Companies Act, 1956 and the Securities and Exchange Board of India (SEBI) guidelines to be followed by the company in this regard.