V BBMV BBM ‘‘BB’’ BUSINESS LAW CLASSBUSINESS LAW CLASS
1. Introduction to Business Laws1. Introduction to Business Laws
2. Indian Contract Act, 18722. Indian Contract Act, 1872
3.3. Patent Act, 1970Patent Act, 1970
4. Trade & Merchandise Marks Act, 19584. Trade & Merchandise Marks Act, 1958
5. Copyright Act, 19575. Copyright Act, 1957
6. Consumer (Protection) Act, 19866. Consumer (Protection) Act, 1986
7. Foreign Exchange Management Act, 19997. Foreign Exchange Management Act, 1999
8. Information Technology Act, 20008. Information Technology Act, 2000
9. Environment Protection Act9. Environment Protection Act
10.Competition Act, 200210.Competition Act, 2002
Module I.Module I.
BUSINESS LAWSBUSINESS LAWS
What is law ?What is law ?
1. A1. A citizencitizen may think ofmay think of ‘‘lawlaw’’
as a set of rules which he must obey.as a set of rules which he must obey.
2. A2. A lawyerlawyer who practiceswho practices ‘‘ lawlaw’’ may think of lawmay think of law
as aas a vocationvocation..
3. A3. A legislatorlegislator may look atmay look at ‘‘lawlaw’’
as a something created by him.as a something created by him.
4. A4. A judgejudge may think ofmay think of ‘‘lawlaw’’
as a guiding principles to be applied in makingas a guiding principles to be applied in making
►LawLaw includes all thoseincludes all those rulesrules
and regulationsand regulations whichwhich
►regulate our relations with otherregulate our relations with other
individuals and with the state.individuals and with the state.
Meaning of lawMeaning of law
►Law means aLaw means a set of rulesset of rules..
►It may be defined as the rules of conductIt may be defined as the rules of conduct
recognized and enforced by the state torecognized and enforced by the state to
control and regulatecontrol and regulate
the conduct of people,the conduct of people,
to protect their property andto protect their property and
contractual rights with a view tocontractual rights with a view to
securing justice, peaceful living andsecuring justice, peaceful living and
social security.social security.
► The law is not rigid, it is flexible.The law is not rigid, it is flexible.
► Since the value system of society keeps onSince the value system of society keeps on
changing , the law also keeps changingchanging , the law also keeps changing
according to the changing requirements of theaccording to the changing requirements of the
► There are several branches of law such asThere are several branches of law such as
International law, constitutional law, criminal law,International law, constitutional law, criminal law,
civil law etc..civil law etc..
► Every branch of law regulates and controls aEvery branch of law regulates and controls a
particular field of activity.particular field of activity.
Why should one know lawWhy should one know law
► BecauseBecause ignorance of law is no excuse.ignorance of law is no excuse.
► Ex : 1Ex : 1
If X is caught traveling in a train without ticket,If X is caught traveling in a train without ticket,
cannot plead that he was not aware of the rulecannot plead that he was not aware of the rule
regarding the purchase of ticket and therefore, heregarding the purchase of ticket and therefore, he
may be excused.may be excused.
► Ex : 2Ex : 2
If Y is caught driving scooter without drivingIf Y is caught driving scooter without driving
license, he cannot plead that he was not aware oflicense, he cannot plead that he was not aware of
the traffic rule regarding the obtaining of a drivingthe traffic rule regarding the obtaining of a driving
license and therefore, he may be excused.license and therefore, he may be excused.
Definition ofDefinition of LawLaw by Salmondby Salmond
►““ LawLaw is ………………is ………………
……the body of principles recognized andthe body of principles recognized and
applied by the State in theapplied by the State in the
administration of the justiceadministration of the justice ””..
Object of lawObject of law
►The object of law isThe object of law is orderorder, and the, and the
result of orderresult of order is thatis that men aremen are
enabled to look ahead withenabled to look ahead with
some sort of security as tosome sort of security as to
the futurethe future..
Need for the knowledge of lawNeed for the knowledge of law
► ‘‘Ignorantia juris non excusatIgnorantia juris non excusat ’’
is a familiar maxim.is a familiar maxim. This meansThis means
ignorance of law is not excusableignorance of law is not excusable ..
The law now a days is a matter of great intricacy.The law now a days is a matter of great intricacy.
As suchAs such nono sound business mansound business man wouldwould
attempt to solve important legal questionsattempt to solve important legal questions
affecting his business interest withoutaffecting his business interest without
expert legal adviceexpert legal advice ..
BUSINESS LAWSBUSINESS LAWS
►Business lawsBusiness laws
are those laws whichare those laws which regulateregulate thethe
conduct of the business.conduct of the business.
Sources of Business LawSources of Business Law
► 1.English Mercantile Law1.English Mercantile Law
► 2.The Statute Law2.The Statute Law
► 3.The Common Law (sometimes called as case3.The Common Law (sometimes called as case
► 4.Customs and Usages4.Customs and Usages
► English MercantileEnglish Mercantile LawLaw: English laws are the: English laws are the
primary sources of Indian Mercantile Law. Englishprimary sources of Indian Mercantile Law. English
laws are based on customs and usages oflaws are based on customs and usages of
merchants in England.merchants in England.
► The StatuteThe Statute LawLaw: The various Acts passed by: The various Acts passed by
the Indian Legislature are the main sources ofthe Indian Legislature are the main sources of
mercantile law in India, e.g. Indian Contract Act,mercantile law in India, e.g. Indian Contract Act,
1872, The Sale of Goods Acts,1930, The1872, The Sale of Goods Acts,1930, The
Partnership Act, 1932, The Negotiable InstrumentsPartnership Act, 1932, The Negotiable Instruments
Act 1881, The Companies Act, 1956.Act 1881, The Companies Act, 1956.
►The Common LawThe Common Law : This source consists: This source consists
of all those unwritten legal doctrinesof all those unwritten legal doctrines
embodying customs and traditionsembodying customs and traditions
developed over centuries by the Englishdeveloped over centuries by the English
courts. Thus, the common law is found incourts. Thus, the common law is found in
the collected cases of the various courts ofthe collected cases of the various courts of
law and is sometimes known as ‘case law’.law and is sometimes known as ‘case law’.
►The common law emphasizes precedents.The common law emphasizes precedents.
►Customs and usagesCustoms and usages : The customs and: The customs and
usages of a trade are also one of theusages of a trade are also one of the
sources of mercantile law in India. Thesesources of mercantile law in India. These
customs and usages govern the merchantscustoms and usages govern the merchants
of a trade in their dealings both each other.of a trade in their dealings both each other.
Some Acts passed by the Indian LegislatureSome Acts passed by the Indian Legislature
recognizes the importance of such customsrecognizes the importance of such customs
and usages.and usages.
Module: IIModule: II
Law of ContractLaw of Contract
► The law of contract is regulated by Indian Contract Act, 1872The law of contract is regulated by Indian Contract Act, 1872
OBJECT OF THE LAW OF CONTRACTOBJECT OF THE LAW OF CONTRACT
The law of contract is that branch of law whichThe law of contract is that branch of law which
determines the circumstances in whichdetermines the circumstances in which promisespromises
made by the parties to a contract shall bemade by the parties to a contract shall be
legally binding on them.legally binding on them.
In simple words, the purpose of law of contract isIn simple words, the purpose of law of contract is toto
ensure the realization of reasonable expectation ofensure the realization of reasonable expectation of
the parties who enter in to contract.the parties who enter in to contract.
OBJECT OF LAW OF CONTRACTOBJECT OF LAW OF CONTRACT
According toAccording to Sir William AnsonSir William Anson,,
The law of contract is intended to ensureThe law of contract is intended to ensure
that,that, ‘‘what a man has been led towhat a man has been led to
expect shall come to pass, and thatexpect shall come to pass, and that
what has been promised to himwhat has been promised to him
shall be performed.shall be performed.
‘‘JUS IN REMJUS IN REM’’ &&
‘‘JUS IN PERSONAMJUS IN PERSONAM’’
Law of contractLaw of contract creates,creates,
‘‘jus in remjus in rem’’ andand ‘‘jus in personamjus in personam’’..
►‘‘Jus in remJus in rem’’ means,means,
right against the world at large.right against the world at large.
‘‘jus in personamjus in personam’’ means,means,
the right against particular persons.the right against particular persons.
Definition of ContractDefinition of Contract
► SectionSection 2(h)2(h) ofof Indian Contract Act, 1872Indian Contract Act, 1872
defines a contract asdefines a contract as …………....
““An agreement enforceable by lawAn agreement enforceable by law ””..
So, a contract is an agreement madeSo, a contract is an agreement made
between two or more parties which thebetween two or more parties which the
law will enforce.law will enforce.
► An agreement enforceable by law is aAn agreement enforceable by law is a
Contract = Agreement + EnforceabilityContract = Agreement + Enforceability
Agreement = Offer + AcceptanceAgreement = Offer + Acceptance
An agreementAn agreement is defined as,is defined as,
““every promise and set of promises, formingevery promise and set of promises, forming
consideration for each otherconsideration for each other ”” [Sec2(e)].[Sec2(e)].
Definition ofDefinition of PromisePromise
► A promiseA promise isis defined thus:defined thus:
““When the person to whom the proposal isWhen the person to whom the proposal is
made signifies his assent there to, themade signifies his assent there to, the
proposal is said to be accepted.proposal is said to be accepted.
A proposal, when accepted, becomes aA proposal, when accepted, becomes a
promisepromise..”” [Section 2(b)].[Section 2(b)].
An agreement is an accepted proposal.An agreement is an accepted proposal.
Consensus ad idemConsensus ad idem
► The essence of an agreement isThe essence of an agreement is meeting of themeeting of the
minds of the partiesminds of the parties.There must in fact, be.There must in fact, be
consensus ad idemconsensus ad idem ..
► Eg.,Eg., AA, (owns two horses named Rajhans &, (owns two horses named Rajhans &
Hansraj), is selling horse Rajhans toHansraj), is selling horse Rajhans to BB..
BB thinks he is purchasing Hansraj.thinks he is purchasing Hansraj.
There is noThere is no consensus ad idemconsensus ad idem consequently noconsequently no
Agreement and its typesAgreement and its types
►Legal AgreementLegal Agreement
►Social AgreementSocial Agreement
►Domestic AgreementDomestic Agreement
► An agreement, to become a contract,An agreement, to become a contract, must give rise to amust give rise to a
legal obligation or dutylegal obligation or duty..
► An obligation is a legal tie which imposes upon a definiteAn obligation is a legal tie which imposes upon a definite
person or persons the necessity of doing or abstainingperson or persons the necessity of doing or abstaining
from doing a definite act or acts.from doing a definite act or acts.
Ex. A agrees to sell his car to B for Rs.1,00,000/-.TheEx. A agrees to sell his car to B for Rs.1,00,000/-.The
agreement gives rise to an obligation on the part of A toagreement gives rise to an obligation on the part of A to
deliver the car to B on the part of B to pay Rs.1,00,000/- todeliver the car to B on the part of B to pay Rs.1,00,000/- to
A. This is aA. This is a legal agreementlegal agreement . This agreement is a. This agreement is a
► An agreement which gives rise to socialAn agreement which gives rise to social
obligation is not a contractobligation is not a contract ..
► An agreement is a wider term.An agreement is a wider term.
► An agreement may be a social agreement or aAn agreement may be a social agreement or a
legal agreement.legal agreement.
► If A invites B to a dinner and B accepts theIf A invites B to a dinner and B accepts the
invitation, it is ainvitation, it is a social agreementsocial agreement ..
► A social agreement does not give rise to contractualA social agreement does not give rise to contractual
obligations and is not enforceable in a Court of law.obligations and is not enforceabl