Explore topic-wise InterviewSolutions in Current Affairs.

Correct option is (a) Memorandum

IPO: Initial Public Offer is an offer made by the company for the first time to the public to buy the shares of the company. Book Building Process: It is a process where a company determines the issue price of shares/securities based on demand from the public.

Karta is the head of HUF. He controls and administers the HUF. The role other members is just to help and suggest. Since Karta can be considered the whole and soul of the HUF his liability is unlimited while that of other members is limited.

(i) True

(ii) True

(iii) True

(iv) True

7 and 2 respectively.

1. Limited Capital : The sole trader is the only owner of business. He alone contributes capital for business. Capital is in the form of savings and borrowings from friends and relatives. In his individual capacity he cannot raise loans from banks to a large extent. The growth and expansion of business is affected because of limited capital. This is disadvantage to business.

2. Limited Managerial Ability : There is only one person to manage business. Inspite of his knowledge, the sole trader is not able to manage business efficiently. The sole trader may not be an expert in all fields like finance, advertising, management etc. Therefore, management ability is limited.

3. Unlimited Liability : The liability of the sole trader is unlimited. There is no difference between personal property and business property of sole trader. But unlimited liability prevents further expansion. He does not take risk in business. He is overcautious in taking decision which affects progress of business.

4. No Stability : A sole trading concern does not have a continuous existence. It does not have a stable life. Life of the organisation depends upon the life of the sole trader. In case the sole trader dies, becomes insolvent or insane the business has to be closed down.

As per Companies Act, 1956, a company is an artificial, invisible and intangible person created by law, having a separate legal entity. As per Companies Act, 2013, ‘Company’ means a company registered under this act or any former act.

Correct option is (C) 7

Correct option is (D) Co-operative society

MSME’s are Micro, Small and Medium Enterprises, which play an important role in promoting entrepreneurship among women and economically weaker section in the country.

Contents of Certificate of Incorporation:

• The name of the company.
• Date of issue of Certificate of Incorporation.
• Corporate Identity Number (CIN).
• Permanent Account Number (PAN) and Tax Deduction and Collection Account Number (TAN) of the company.
• Signature of Registrar with the date and his seal.

Correct option is (C) 200

Correct option is (C) Partnership

Correct option is (A) 2

Correct option is (A) Company

Correct option is (A) Co-operative society

• As per section 2(2) of the companies Act, 1956 ‘Articles’ means Articles of Association of a company as originally framed or as altered from time to time in pursuance of any previous companies’ law or of this Act.
• The Articles regulate the internal management of a company.
• It states the relationship between the company and its members.
• The articles, being the internal regulations of a company can be altered easily.
• The articles are required to be altered from time to time as per changes made by the government in the company law or as per changing situations in the corporate sector.
• Thus, the Articles of Association can be altered by passing a ‘Special Resolution’ at a general meeting.

Udyami Mitra is the digital portal launched by SIDBI, to improve accessibility of credit and handholding services to MSMEs.

Correct option is (D) All of these

Co-operative Society

(a) Beauty Saloon: Sole Proprietor is the right form of business because: 

• It needs limited capital. 
• It is easy to form. 
• Entire profits will belong to the owner. 
• It requires personal attention.

(b) Garments Shop: Sole Proprietor is the right form of business because: 

• It needs limited capital. 
• It is easy to form. 
• Entire profits will belong to the owner.

(c) Garment Factory: Partnership is more suitable because: 

• It can be easily started and closed without any legal formalities. 
• He is not expected to share his business decisions and secrets with anybody. 
• Direct relationship between efforts and reward provide incentive to the sole trader to work hard. 
• The sole trader can maintain personal contacts with his customers and employees. 
• It provides employment to persons with limited money who are not interested to work under others. It prevents concentration of wealth in a few hands.

(c) Joint Hindu Family 

The difference between a partnership and sole proprietorship form of business may be as follows. This helps the entrepreneur in selecting form of business of his choice. 

• Membership: Partnership is owned by two or more persons subject to the limit ten in banking business and twenty in case of other business. Sole proprietorship is owned by one and only one person. 
• Formation: It is formed through an agreement which may be oral or in writing, is formed quite easily as it is the outcome of a single person’s decision without any legal administrative approval. 
• Registration: The registration is not compulsory. It needs no registration except some compliance. 
• Regulating law: It is governed by the rules contained under the Indian Partnership Act, 1932. There is no specific statutory law to govern the functioning of sole proprietors business. 
• Capital: There is more scope for raising a larger amount of capital as there are more than one person. It has a limited financial capability. Hence, the scope for rising capital is naturally least. 
• Quickness in decision-making: Decision-making in partnership is corporately delayed as the partners arrive at decision after consultation with one another. The decision of the sole proprietor is prompt as he need not consult anyone. 
• Maintenance of secrecy: Maintenance of absolute secrecy is not possible if partnership as business secrets are accessible to more than one partners. The sole proprietor need not share his business secrets with anybody. 
• Management: Every partner has the right to take active part in the management of the business. Each partner also enjoys the authority to bind the firm and other partners for his acts in the ordinary course of business. The sole proprietorship is self-managed one and a few employees may support him. However, the decision of the proprietor is final and binding. 
• (i) Risk: The risk connected with the business is comparatively less as it is shared by all the partners. The risk of the sole proprietor is greater than that of partnership form of business. 
• (j) Duration: It continues as long as the partners desire. Even though legally it comes to an end on the death, insolvency or retirement of any of the partners, the business is continue with the remaining partners. It comes to an end with the death, insolvency incapacity of the proprietor. Thus, there is uncertainty of duration of sole proprietorship

‘सोशल चेंज इन मॉडर्न इंडिया’ पुस्तक के लेखक का नाम एम०एन० श्रीनिवास है।

रेसेज एंड कल्चर्स ऑफ इंडिया’ पुस्तक के लेखक का नाम डी०एन० मजूमदार है।

सही विकल्प है (क) पूँजीपति

A cooperative society is a voluntary association of persons of moderate means, who unite together to protect and promote their common economic interests. 

Features: 

• Voluntary association: Everyone having a common interest is free to join a cooperative society and can also leave the society after giving proper notice. 
• Legal status: Its registration is compulsory and it gives it a separate identity. 
• Limited liability: The liability of the member is limited to the extent of their capital contribution in the society. 
• Democratic control: Management and control lies with the managing committee elected by the members by giving vote. Every member has one vote irrespective of the number of shares held by him. 
• Service motive: The main aim is to serve its members and not to maximize the profit. 
• State control: They have to abide by the rules and regulations framed by government for them. 
• Distribution of surplus: The profit is distributed on the basis of volume of business transacted by a member and not on the basis of capital contribution of members.

Merits: 

• Ease of formation: It can be started with minimum of 10 members. Registration is also easy as it requires very few legal formalities. 
• Limited liability: The liability of members is limited to the extent of their capital contribution. 
• Stable existence: Due to registration it is a separate legal entity and is not affected by death, lunacy or insolvency of any of its members. 
• Economy in operations: There is economy in operation due to elimination of middle man and voluntary services provided by its members. 
• Government support: Government provides support by giving loans at lower interest rates, subsidies and by charging less taxes. 
• Social utility: It promotes personal liberty, social justice and mutual cooperation. They help to prevent concentration of economic power in a few hands.

Limitations: 

• Shortage of capital: It suffers from shortage of capital as it is usually formed by people with limited means. 
• Inefficient management: Cooperative society is managed by elected members who may not be competent and experienced. Moreover it can’t afford to employ expert and experienced people at high salaries. 
• Lack of motivation: Members are not inclined to put their best efforts as there is no direct link between efforts and reward. 
• Lack of secrecy: Its affairs are openly discussed in its meeting which makes it difficult to maintain secrecy. 
• Excessive government control: It suffers from excessive rules and regulations of the government. It has to get its accounts audited by the auditor and has to submit a copy of its accounts to registrar. 
• Conflict among members: The members are from different sections of society with different view points. Sometimes when some members become rigid, the result is conflict.

Cooperative is a form of organization wherein persons voluntarily associate together as human beings on the basis of equality for the promotion of an economic interest for themselves. In a cooperative society, the power to take decisions lies in the hands of an elected managing committee. The right to vote gives the members a chance to choose the members who will constitute the managing committee and this lends the cooperative society a democratic character. Also, the principle of ‘one man, one vote’ governs the cooperative society, irrespective of the amount of capital contribution by a member, each member is entitled to equal voting rights. The membership of a cooperative society is voluntary. A person is free to join a cooperative society, and can also leave anytime as per his desire. Membership is open to all, irrespective of their religion, caste and gender. Thus, by keeping all these points in mind, a cooperative society exemplifies democracy and secularism.

The main differences between Cooperative Organisation and Company Organisation are given below: 

1. Governing statute: A company is governed by the Companies Act, 1956 while a cooperative organisation is subject to the provisions of the Cooperative Societies Act, 1912 or State Cooperative Societies Acts. 

2. Basic objects: The primary objective of a cooperative society is to provide service, whereas a company seeks to earn profits. This does not mean that a cooperative society does not earn profits or a company does not render service to society.It simply means that all the activities of a cooperative society are guided by service motive and profits are incidental to this objective. On the other hand, the activities of a company are inspired by profit taking and services rendered to society are incidental to profit motive. 

3. Number of members: The minimum number of persons is 7 in a public company and 2 in a private company. A cooperative requires at least 10 members. The maximum number of members is 50 in a private company and 100 in cooperative credit society. There is no maximum limit in case of public companies and non-credit cooperative societies. 

4. Member’s liability: The liability of members of a company is generally limited to the face value of shares held or the amount of guarantee given by them though the Companies Act permits unlimited liability to companies. The members of a cooperative society can opt for unlimited liability. But in practice their liability is generally limited. 

5. Management and control: The management of a cooperative society is democratic as each member has one vote and there is no system of proxy. In a company, the number of votes depends upon the number of shares and proxies held by a member. There is little separation between ownership and management in a cooperative society due to limited and local membership. 

6. Distribution of surplus: The profits of a company are distributed as dividends in proportion to the capital contributed by the members. In a cooperative society a minimum part of surplus must be set aside as a reserve and for the general welfare of the public. The rest is distributed in accordance with the patronage provided by different members after paying dividend up to 10 per cent on capital. 

7. Share capital: In a company, one member can buy any number of shares but an individual cannot buy more than 10 per cent of the total number of shares or shares worth Rs 1,000 of a cooperative society. A public company must offer new shares to the existing members while a cooperative society issues new shares generally to increase its membership. The subscription list of a cooperative society is kept open for new members whereas, the subscription list of a company is closed after subscriptions. A company is thus capitalistic in nature while a cooperative society is socialistic. 

8. Transferability of interest: The shares of a public limited company are freely transferable while the shares of cooperative society cannot be transferred but can be returned to the society in case a member wants to withdraw his membership. A member of a cooperative society can withdraw his capital by giving a notice to the society. A shareholder, on the other hand, cannot demand back his capital from the company until it’s winding up.

Correct Answer is  employment

'कास्ट इन कंटेम्परेरी इंडिया’ पुस्तक के लेखक का नाम पी० कोलंडा है।

i. MCA

ii. MCA

iii. ROC

iv. ROC

v. NCLT

vi. NCLAT

vii. SEBI

viii. SEBI

The authority attached to the High Court which helps in the winding up of Companies is the Official Liquidator.

i. True

ii. False

iii. True

iv. True

v. True

vi. True

vii. True

viii. True

ix. False

सही विकल्प है (घ) नेसफील्ड

इस पुस्तक के लेखक का नाम एम०एन० श्रीनिवास है।

MCA (Ministry of Corporate Affairs).

i. MCA (Ministry of Corporate Affairs)

ii. ROC (Registrar of Companies)

iii. NCLT (National Company Law Tribunal)

iv. NCLAT (National Company Law Appellate Tribunal)

Role of auxiliaries to trade:

1. Auxiliaries to trade are all the services which help trade. 

2. Trade means buying and selling of goods. However buying and selling is not possible unless it is supported by different services which will make the trade easy. 

3. There are different auxiliaries or services which support buying and selling. They are : transport, warehousing, banking, insurance, advertising, etc. 

4. These services help the trader as well as the buyers. They remove the hindrances in the process of distribution and ensure smooth flow of goods from the manufacturer to consumer. 

5. In modern world, the manufacturers and’ consumers stay away from each other. It becomes very difficult for the manufacturer to contact the buyers and sell goods directly to them.

6. In this regard auxiliaries to trade help in establishing a link between the manufacturer or seller to consumer.

Auxiliaries to trade are all those services which help in the smooth conduct of trade. There are different types of services which help trade. They are explained below.

(i) Warehousing: Warehousing helps to store the goods safely. There is a gap between the time of production and the time of consumption. Warehousing fills up this gap by conveniently storing the goods till they are demanded in the market. Warehousing, thus, creates time utility. Care is taken that the goods do not get damaged in the warehouse.

(ii) Advertising : Advertising is an important tool in the hands of a businessman to communicate to potential buyers. In today’s world producer/seller is situated at one place and consumers are spread over wider area. Through advertisement, producer or seller can contact the consumers. There are different mediums of advertisement, e.g. T.V., Radio, Hoardings, Print etc.

(iii) Insurance : Business is exposed to many risks. A businessman has to be careful about the risks. Some risks can be avoided, some can be minimized and some can be transferred. Insurance is an auxiliary which helps the businessman to handle the risk. Businessman can transfer some of the risks to insurance company. Insurance company, by accepting premium from the businessman, assures him to pay compensation in case of loss.

(iv) Transport: Transport is an important auxiliary to trade. Transport carries raw materials and people to place of production and brings finished goods to markets. Thus transport creates place utility. Transport can be conducted by different modes e.g. rail, road, water or air.

Beside the above features, there are other features like

1. Banking 

2. Mercantile Agents 

3. Communication

i. (a) MCA

ii. (b) New Delhi

iii. (a) MCA

iv. (a) ROC

v. (a) ROC

vi. (b) ROC

vii. (c) Regional Directors

viii. (c) NCLT

ix. (a) NCLAT

x. (c) Supreme Court

xi. (c) SEBI

xii. (a) SEBI