ibps law modelpaper

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IBPS Specialist Officers LAW Model Paper

1. In a contract of guarantee, the liability of the surety covers any sum owed by

the principal debtor. Therefore, the liability includes -------- also:

a) Interest

b) Costs

c) Charges

d) All of the above

e) None

2. Banks are restricted to advance against its own shares as per:

a) Section 20 of Banking Regulation Act

b) Section 20 of RBI Act

c) Section 20 of Companies Act

d) None of the above

e) All the above

3. RBI has vide notification dated 25th Dec 2005 enlarged the scope of Banking

Ombudsman. The new scheme includes areas such as:

a) Credit cards

b) Services by sales agents

c) Levying Service charges without prior notice

d) All as above

e) None



4. When a guaranteed loan is paid by the guarantor, he gets the rights of the

Principle debtors and is said to be stepping in to the shoes of the debtor. This

right is known as _____

a) Right of Navigation

b) Right of Substitution

c) Right of Subrogation

d) Guarantor’s right

e) All the above

5. Every partner of a firm is also a _____ of the firm.

a) Manager

b) Agent

c) Director

d) Creditor

e) All the above

6. In the famous English case of R.D. Harbottle Ltd vs. National west minister

bank(1978), which is related to a banker’s obligation under a bank guarantee

issued by him and invoked, it was held that ______.

a) Bank’s obligation to pay is primary.

b) Bank guarantees are autonomous & independent contracts

c) Except in case of fraud, banks need not concern themselves with

relationship the Supplier’s performances.

d) All as above

e) None



7. In which of the following states the Recovery of Debts due Act is under

implementation?

a) Selected States of the Country.

b) All the state of Country.

c) All over the country except Jammu & Kashmir.

d) No such restriction.

e) None

8. What is the fee payable for the Debt amount above Rs. 10 lakh?

a) Rs. 1000 for every Rs. 1 lakh and part thereof.

b) Rs. 1200 for every Rs. 1 lakh and part thereof.

c) Rs. 1500 for every Rs. 1 lakh and part thereof.

d) Rs. 2000 for every Rs. 1 lakh and part thereof.

e) All the above

9. Which of the following can be proved in the court of Law according to

Bankers Books Evidence Act?

a) Existence of a document.

b) Condition of a document.

c) Contents of a document

d) All the above

e) None

10. Which of the following transactions would amount to a pledge?

a) Delivery of the key where the goods are stored.

b) The Bankers Books Evidence act. Is also an exception to the Evidence Act



c) Endorsement of warehouse receipt by the borrower in favour of the

bank.

d) None of the above.

e) All the above

11. Legal proceeding under Bankers Books Evidence Act, signifies:

a) Any proceeding or inquiry in which evidence is given

b) An arbitration

c) Any investigation under the code of Criminal Procedure, 1973.

d) All the above.

e) None

12. Which of the following statements is correct?

a) All documents produced for inspection of court are called documentary

evidence.

b) Primary Document mean original document itself.

c) Certified copies are secondary evidences.

d) All the above.

e) None

13. An instrument the part payment of which has already been made can be

endorsed further:

a) For the remaining

b) For the entire sum

c) Statement is not correct

d) All of these

e) None of these



14. The bailment of goods as security for payment of a debt or performance of a

promise is known as

a) Pledge

b) Hypothecation

c) Hypothecation

d) Lien.

e) All the above

15. Financial guarantee is issued, where the customer is asked to submit for the

performance of the contract in lieu of:

a. Earnest money

b. Cash deposit

c. Any one of the above

d. All of the above

e. None

16. The death of the surety operates, in the absence of any contract to the

contrary as a revocation of a continuing guarantee:

a) So far as regards future transactions.

b) For both the past and the future transactions.

c) For future transactions only if the creditor has notice of the death.

d) All the above.

e) None

17. A 'fidelity guarantee' is one in which the guarantee is given for :

a) The repayment of a debt.



b) The payment of the price of the goods sold on credit

c) The good conduct of honesty of a person employed in a particular office

d) None of these

e) All

18. Which of the following is not the essential of a contract?

a) Transfer of ownership

b) Immediate delivery of the goods

c) The consideration of sale must be in money.

d) Goods must be movable property.

e) All the above

19. If A agrees to sell to B certain goods which shall arrive on a ship. Which kind

of goods it would be?

a) Contingent goods.

b) Future goods.

c) Unascertained goods

d) None

e) All the above

20. Which of the following is not included as a condition in a sale by sample?

a) The goods should have market value.

b) The goods should be supplied correspondent with the sample in quality.

c) The buyer should have opportunity to compare with the sample.

d) The goods should be free from any defect rendering them

unmerchantable.

e) All the above



21. The place of delivery will be.

a) It is too delivered at the place at which they are at the time of sale.

b) In case of an agreement to sale the delivery will be at the place where

they are at the time of agreement.

c) When goods are not in existence at the time of agreement, they are

manufactured.

d) Any of the above places.

e) All the above

22. Which of the following is not correct?

a) Right of lien can be exercised for payment of other charges such as

storage.

b) If seller has delivered part of goods, he may exercise lien on the

remainder.

c) If seller has delivered part of goods, he may exercise lien on the

remainder.

d) Where delivery is to be made in installments the seller can’t retain

remaining installments.

e) All the above

23. Which of the following is not the part of Articles of Association?

a) Incidental objects.

b) General Meetings.

c) Dividend and Reserve funds.

d) Accounts and Audit.

e) All the above



24. Which of the following is not included in the prospectus?

a) Balance sheet of the company.

b) Voting rights or members.

c) Restriction on transfer of shares.

d) Material contract and inspection documents..

e) All the above

25. Which of the following is not correct?

a) Extraordinary General Meeting is conducted for some special and urgent

business.

b) Private company need not conduct AGM.

c) The AGM must be held in every calendar year.

d) The time gap between two AGMs should not exceed 15 month.

e) All the above

26. A public company can be converted into private company in the following

circumstances:

a) The resolution should be passed and approved by central government.

b) The Article should be suitably amended to include 3 basic restrictions

application on private companies.

c) The name of the company 'Private' shall be amended in the documents.

d) All the above.

e) None

27. The term ‘hypothecation ‘ is defined in which of the following :

a) Indian contract Act

b) SARFAESI Act



c) Sale of goods act

d) Negotiable instrument Act

e) None of these

28. Which of the following cannot be a promoter of a company?

a) Minor or undercharged insolvent.

b) NRI without approval of RBI.

c) Any one of the above.

d) Partnership firm

e) All the above

29. Who can’t employ as an Agent?

a) A minor

b) A man of sound mind

c) Who has attained the age of majority.

d) A person who is competent to contract.

e) All the above

30. A partnership firm stands dissolved on:

a) Death of a partner

b) Insolvency of a partner

c) Retirement of a partner

d) All of these

e) None



31. A minor is a person:

a) Who has not completed 18 years of age

b) In whose case a guardian of his person or property is appointed by the

court before he completes his 21st year

c) Both (a) & (b)

d) Who has not completed 15 years of age

e) All the above

32. A savings bank account may be opened in the name of a minor to be created

upon by him if he has attained the age of:

a) 6 years

b) 10 years

c) 12 years

d) 24 years

e) All the above

33. Which of the following statement is correct?

a) If an advance is granted to a minor on the guarantee of a third party,

such advance cannot be recovered from the guarantee also

b) If the contract of guarantee in the above case specially provides contrary

to the above the guarantee may be held liable for the debts of a minor

c) If a minor enters into an agreement by respecting himself as major &

later on claims such a contract as void on account of his minority

d) All of the above

e) None



34. The person on whose behalf the guarantee is issued . is known as:

a) Applicant

b) beneficiary

c) guarantor

d) drawer

e) All the above

35. A guardian may be appointed by the court under the Guardians & Wards

Act, 1890:

a) The court shall not be authorized to appoint or declare a guardian of the

person of a minor, if his father is alive & is not, in the opinion of the

court unfit to be guardian of the person of a minor

b) The court shall be authorized to appoint or declare a guardian of the

person of a minor. Keeping in view the

c) welfare of the minor irrespective of the fact whether the father is alive

or not

d) Thus the father or the husband in case of a married girl is not exclusively

entitled to be the guardian

e) All the above

36. As the husband of a married woman shall not be liable for the debts taken

by his wife a banker should therefore:

a) Remain from granting a loan to married woman

b) Invariably insist on a declaration that her husband has defaulted in

supply of necessaries & the amount shall be utilized for this propose



c) Examine her own assets & ensure that the same are sufficient to cover

the amount of loan

d) All of the above

e) None

37. Which of the following statements is not correct?

a) An illiterate person should not be allowed to open a current account

b) Term deposits should not be accepted from illiterate persons

c) The illiterate depositor may be allowed to open a joint account payable

to any one survivor or 'either or survivor' with another literate person.

The literate person may be allowed to use the cheque book facility

d) All of the above

e) None

38. While opening an account in the names of persons in their capacity as

trustees the banker should take the following precaution:

a) The trust deed in original must be called for in order to ascertain the

terms of the trust & a certified copy thereof should be retained on the

bank's records for reference

b) The account may be opened in the personal name(s) of the trustee(s)

followed by the name of the trust or in the name of the trust

c) If the present trustee(s) is/are different from the original one(s) then

deed of appointment to show an unbroken chain of succession should

be obtained

d) All of the above

e) None



39. Which of the following statement is correct?

a) The executor is appointed by the will; his powers & authority are vested

therein. He has to act according to the directions given in the will

b) The executor is appointed by the court through a letter of

administration & is directed in the absence of a will to settle the affairs

according to the provision of the law

c) The administrator is appointed by the will, this powers & authority are

vested therein, & has to act according to the directions given in the will

d) All of the above

e) None

40. A tractor is financed by bank A. It will be registered with which of the

following authority?

a) Register of Assurances

b) Register of Companies

c) Register of Firms

d) Regional Transport Authority

e) Does not require registration

41. On the death of one of the executors of an administrator:

a) A cheque is issued on such account should be dishonoured

b) Operations should be allowed only when a new executor or

administrator is appointed

c) His powers are vested in the surviving executive administrators as such a

cheque issued on such account should not be dishonored even if he is

one of the signatories



d) All of the above

e) None

42. On the death of the depositor, the amounts deposited in the joint names,

payable to either or survivor:

a) Could be treated as a gift to the survivor

b) Continues to be in the ownership of the deceased

c) Are considered to be held in trust in favour of the deceased person

d) Should be paid to the legal heirs of the diseased & not to the survivor

e) None of these

43. What would you do if one of the joint account holders having a current

account payable to either or survivor dies & his legal representative asks you

not to pay the balance to the survivor?

a) The amount would not be paid to the survivor

b) The amount would be paid to the legal representative of the deceased

c) The amount shall be paid to the survivor while the legal representative

asks you not to pay the balance to the survivor


e) All the above

44. M/s ABC & Co., a firm consisting of three partners, Mr. X, Mr. Y & Mr. Z

maintained a current account with your branch. The firm was dissolved &

Mr. Z was dropped. The new firm with Mr. X & Mr. Y as partners continued

to carry on business & maintain a current account in the same name; i.e.,

M/s ABC & Co. Mr. Z now gives a legal notice to the bank that he was ousted

wrongfully & the bank should not allow Mr. X & Mr. Y to operate the account



a) The bank should take cognizance of the alleged wrong ouster of Mr. Z &

stop

b) The bank should not stop operations but advise Mr. Z, to approach a

competent

c) The bank should ask Mr. X & Mr. Y to sort out the dispute & until then

stop operations


e) All the above

45. In the contract of sale in case of breach of contract , the buyer has right to

sue the seller for:

a) Damages for non-delivery of goods

b) Recovery of price

c) Specific performance of contract

d) Any or all of the above

e) None of these

46. 'Person of Indian Origin' means a citizen of any country other than

Bangladesh or Pakistan, if :

a) he at any time held an Indian passport

b) he or either of his parents or any of his grandparents was a citizen of

India by virtue of the constitution of India or the Citizenship Act, 1955

c) the person is a spouse (not being national of Bangladesh & Pakistan of

an Indian citizen or a person referred to in (a) or (b) above

d) All of the above

e) None



47. Which of the following information can be accessed ?

a) Obtaining certified copies of documents

b) Obtaining certified samples of material.

c) Inspection of documents and records.

d) All of the above

e) None of these

48. In which year the Bankers Book Evidences Act was enacted ?

a) 1891

b) 1906

c) 1934

d) 1947

e) None of these

49. The law regarding negotiable instruments is contained in :

a) The Bill of exchange Act 1881

b) The Banking Regulation Act, 1949

c) The cheques Act, 1881

d) The negotiable instruments Act, 1881.

e) None of these

50. Banks deduct subscription payable to Bank employee Unions under which of

the following?

a) Bipartite

b) Check off system

c) check out system



d) instruction of Lab our commissioner

e) Guidelines of Government of India

Key

K V Gnanakumar,

Director DBS, Hyderabad.

1.c 2.a 3.d 4.c 5.b 6.d 7.c 8.a 9.d 10.b

11.d 12.d 13.a 14.c 15.c 16.a 17.c 18.b 19.b 20.a

21.d 22.a 23.a 24.a 25.b 26.d 27.b 28.a 29.a 30.d

31.c 32.c 33.d 34.a 35.d 36.e 37.b 38.d 39.a 40.d

41.c 42.c 43.c 44.b 45.d 46.d 47.d 48.a 49.d 50.b

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