Mercantile Law

Section 2(13) defines a Director as, “any person occupying the position of director by whatever name called”. Thus, a person will be deemed to be a director if he performs the functions of a director, though he may be named differently. A director is that person who has full control over the direct management and conduct of the company. The directors of a company are collectively referred as the “Board of Directors”, or “Board”. Only individuals can be directors. No body corporate, association or a firm can be appointed director of a company. Rights of Directors i) Right to Participate in the Affairs of the Company: A director, validly appointed, has a right to attend the meetings and participateContinue reading

Section 182 of the contract act defines, “An agent is a person employed to do any act for another or to represent another in dealings with third persons. The person for whom such act is done, or who is represented, is called the principal”. The function of an agent is essentially to bring about contractual relations between the principal and third parties. An agent has certain rights, duties and liabilities towards the principal and third parties depending upon the nature of business. These rights, duties and liabilities can be generated as:- Rights of an Agent i) Right to Receive Remuneration — The agent is entitled to receive an agreed remuneration or reasonable remuneration unless otherwise agreed upon. An agent hasContinue reading

An “agent” is a person employed to do any act for another, or to represent another in dealing with third persons. The person for whom such act is done, or who is so represented, is called the “principal”. As between the principal and third persons, any person may become an agent, but no person who is not of the age of majority and sound mind can become an agent, so as to be responsible to the principal according to the provisions in that behalf herein contained. No consideration is necessary to create an agency. The authority of an agent may be express or implied. An authority is said to be express when it is given by words spoken or written.Continue reading

Two or more persons are said to consent when they agree upon the same thing in the same sense. Consent is said to be free when it is not caused by- Coercion, as defined in section 15, or Undue influence, as defined in section 16, or Fraud, as defined in section 17, or Misrepresentation, as defined in section 18, or Mistake, subject to the provisions of sections 20, 21, and 22. Consent is said to be so caused when it would not have been given but for the existence of such coercion, undue influence, fraud, misrepresentation, or mistake. Coercion: “Coercion” is the committing, or threatening to commit, any act forbidden by the Indian Penal Code (45 of 1860) or theContinue reading

Classification of Negotiable Instruments 1) Inland Instrument- A promissory note, bill of exchange or cheque which is 1) both drawn or made in India and made payable in India, or 2) drawn upon any person resident in India, is deemed to be an inland instrument. A bill of exchange drawn upon a resident in India is an inland bill irrespective of the place where it was drawn. 2) Foreign Instrument- An instrument, which is not an inland instrument, is deemed to be a foreign instrument. Foreign bills must be protested for dishonor if such protest is required by the law of the place where they are drawn. But protest in case of inland bills is optional.Continue reading