1. What is a contract of indemnity as per Section 124 of the Indian Contract Act?
A. A contract to perform a promise of a third person
B. A contract where one party promises to save the other from loss caused by the promisor or any other person
C. A contract to discharge the liability of a third person
D. A contract to guarantee a debt
A contract of indemnity is defined as a contract where one party promises to save the other from loss caused to him by the contract of the promisor himself or by the conduct of any other person.
2. What is a contract of guarantee as per Section 126 of the Indian Contract Act?
A. A contract to perform the promise of the principal debtor
B. A contract to perform the promise or discharge the liability of a third person in case of default
C. A contract to indemnify the creditor
D. A contract to guarantee a service
A contract of guarantee is a contract to perform the promise or discharge the liability of a third person in case of his default. The person who gives the guarantee is called the surety, the person in respect of whose default the guarantee is given is called the principal debtor, and the person to whom the guarantee is given is called the creditor.
3. What is the procedure for the refund of the deposited amount if the appeal under Section 148 succeeds?
A. The deposited amount is forfeited regardless of the appeal outcome.
B. The deposited amount is refunded to the drawer, similar to the procedure under Section 143A.
C. The amount is used to pay any additional fines imposed during the appeal.
D. The amount is donated to a charity.
If the appeal succeeds, the deposited amount is refunded to the drawer, following a procedure similar to that outlined in Section 143A of the Amendment Act.
4. According to Section 148, what is the definition of ‘bailment’?
A. The act of buying goods for resale.
B. The delivery of goods by one person to another for a specific purpose, with the expectation that they will be returned or disposed of according to the directions of the person delivering them.
C. The permanent transfer of ownership of goods from one person to another.
D. The act of lending money against collateral.
According to Section 148, ‘bailment’ is defined as the delivery of goods by one person to another for a specific purpose, with the agreement that the goods will be returned or otherwise disposed of according to the directions of the person delivering them. The person delivering the goods is called the ‘bailor’, and the person receiving them is called the ‘bailee’.
5. Who is the person called who delivers the goods in a contract of bailment?
A. Bailee
B. Bailor
C. Buyer
D. Seller
The person who delivers the goods in a contract of bailment is called the ‘bailor’.
6. In a contract of bailment, who is responsible for returning the goods once the purpose is accomplished?
A. Bailor
B. Bailee
C. Seller
D. Buyer
In a contract of bailment, the ‘bailee’ is responsible for returning the goods once the purpose for which they were delivered is accomplished.
7. Which of the following best describes the term ‘bailee’ in the context of bailment?
A. The person who receives the goods and is responsible for returning them after use.
B. The person who delivers the goods to another for a specific purpose.
C. The person who sells the goods to another party.
D. The person who buys the goods from another party.
The ‘bailee’ is the person who receives the goods and is responsible for returning them after their purpose is fulfilled.
8. What is the purpose of the contract of bailment according to Section 148 of the Indian Contract Act?
A. To sell goods at a market price.
B. To deliver goods for a specific purpose with an agreement to return or dispose of them accordingly.
C. To transfer ownership of goods permanently.
D. To lease goods for a fixed period.
The purpose of a contract of bailment is to deliver goods for a specific purpose with an agreement that they will be returned or disposed of according to the directions of the person delivering them.
9. What is the term used for the bailment of goods as security for the payment of a debt or performance of a promise?
A. Bailment
B. Pledge
C. Lease
D. Mortgage
The bailment of goods as security for payment of a debt or performance of a promise is called "pledge".
10. In the context of a pledge, who is referred to as the 'pawnor'?
A. The person who receives the goods as security.
B. The person who delivers the goods as security.
C. The person who borrows the goods.
D. The person who sells the goods.
In a pledge, the 'pawnor' is the person who delivers the goods as security for the payment of a debt or performance of a promise.
11. Who is known as the 'pawnee' in a pledge?
A. The person who borrows the goods.
B. The person who receives the goods as security.
C. The person who delivers the goods as security.
D. The person who sells the goods.
The 'pawnee' is the person who receives the goods as security in a pledge.
12. Who is referred to as the 'agent' according to Section 182 of the Indian Contract Act?
A. The person who represents another in dealings with third persons.
B. The person for whom an act is done.
C. The person who performs the act for themselves.
D. The person who manages a business.
An 'agent' is a person employed to do any act for another or to represent another in dealings with third persons.
13. In the context of agency, who is known as the 'principal'?
A. The person who performs the act.
B. The person for whom an act is done or who is represented in dealings with third persons.
C. The person who pays for the act.
D. The person who organizes the work.
The 'principal' is the person for whom an act is done or who is represented in dealings with third persons.
14. Raj has given his gold watch to his friend Neelam as a security for a loan of ₹10,000. Neelam agrees to return the watch once Raj repays the loan. What is the legal term for this arrangement?
A. Bailment
B. Pledge
C. Lease
D. Mortgage
Raj's arrangement with Neelam is a "pledge" as the gold watch is given as security for a loan.
15. Priya is a manager of a clothing store and has authorized her assistant, Rahul, to handle all transactions and make purchases on behalf of the store. What is Priya's role in this context?
A. Agent
B. Principal
C. Supplier
D. Customer
Priya is the "principal" as she authorizes Rahul to act on her behalf in handling transactions and making purchases.
16. Arjun lends his car to his colleague, Simran, for a week. Simran must return the car once her trip is over. What type of arrangement does this describe?
A. Loan
B. Bailment
C. Pledge
D. Lease
Arjun's lending of the car to Simran, with the expectation of return, is an example of "bailment."
17. Ankur takes a loan from a bank and offers his diamond ring as security. The bank, in turn, keeps the ring until Ankur repays the loan. In this scenario, who is the 'pawnee'?
A. Ankur
B. The bank
C. The jeweler
D. The insurer
The bank is the "pawnee" as it holds the diamond ring as security for the loan.
18. Aman authorizes his real estate agent, Riya, to sell his property. Riya acts on Aman's behalf to find a buyer and complete the sale. What is Riya's role in this situation?
A. Principal
B. Agent
C. Broker
D. Consultant
Riya is the "agent" as she is authorized by Aman to act on his behalf in selling the property.
19. Which sections were inserted into the Indian Contract Act under Chapter VI A (Special Provision relating to Farming Contracts) by the Indian Contract (Amendment) Act, 2017?
A. Section 65A to 65L
B. Section 75A to 75L
C. Section 85A to 85L
D. Section 95A to 95L
The Indian Contract (Amendment) Act, 2017 inserted Chapter VI A containing Sections 75A to 75L, relating to special provisions for farming contracts.
