Legal & Regulatory Aspects of Banking 2

1. Which of the following are two essential functions of banks as indicated in Section 5(b) of banking Regulation Act (a) accept deposits & to lend or invest such deposits (b) accept deposit & undertake non-fund based business (c) accept deposits and undertake remittance business (d) lend & invest and issue letters of credit:

2. Which of the following group is not included in term goods, as per Sale of Goods Act:

3. A suit is deemed to have been instituted (filed) in a court:

4. Other than the business specified u/s 6 (1) of Banking Regulation Act, a bank can undertake any other business which can be prescribed / decided by (a) Central Govt. (b) RBI (c) Board of the bank (d) Ministry of Corporate Affairs.

5. Private Sector banks are regulated by (a) Companies Act 1956 (b) Banking Regulation Act 1949 (c) RBI Act 1934 (d) banking Companies (Acquisition & Transfer of Undertakings) Act 1970:

6. As per Sale of Goods Act, the ____ goods mean the goods identified and agreed upon, at the time of a contract of sale is made:

7. Time required for obtaining a copy of the order or award shall be excluded while computing the limitation period for:

8. Which of the following are regulated by Banking Regulation Act 1949 (a) Public Sector Banks (b) State Bank Group banks (c) RRBs (d) Coop Land Mortgage Banks

9. In the context of Cooperative Banks, which of the following statements are correct (a) coop bank operating in one State obtains registration under State Coop Societies Act (b) for Coop banks operating in more than one State, Central Govt. appoints Registrar (c) Coop banks are under purview of B R Act u/s 56 (d) Where Coop bank is registered under DICGC Act, RBI can order its winding up.

10. Which of the following statement is a not correct:

11. For foreclosure of a mortgage, the limitation period is 12 years from:

12. While issuing a banking license for a foreign banks RBI, in addition to usual consideration takes into account (a) whether the business will be carried by the company in public interest (b) whether the law of the country where the bank originated discriminates against Indian banks (c) whether the company complies with provisions of B R Act, as applicable to foreign companies:

13. As per Sale of Goods Act, the _____ goods which are to be manufactured by the seller after making contract of sale:

14. Which of the following statements are not correct in connection with shareholding in an Indian bank under provision of B R Act:

15. Before declaring a dividend a banking company has to reduce from its profits (a) preliminary or share selling expenses (b) organization expenses (c) brokerage and loss incurred (d) bad debts for which adequate provision has been made:

16. In case if non-resident persons, which of the following income is taxable:

17. RBI can appoint Chairman of a bank (a) if the office is lying vacant and not filled immediately (b) if in the opinion of RBI such vacant position is to be against interest of the banking company (c) such appointment shall be maximum for a period of 5 years (d) there is provision for re-appointment after the initial period.

18. In the context of capital of a bank (a) the authorized capital means the maximum limit of share capital which the bank is authorized to have under its memorandum (b) the amount of share capital which is subscribed and received is called paid up capital (c) the amount of share capital which is issued and paid up is called subscribed capital:

19. Under Sale of Goods Act, if the sale is by sample, which of the following implied condition is not correct:

20. Banks are required to deposit the amount of TDS, in the govt. account:

21. RBI cannot give directions to banks for loans and advances in respect of which of the following:

22. As per Sale of Goods Act, the ______ of the seller is terminated when the buyer gets possession of the goods:

23. Banks are required to transfer a part of their profits to a Reserve Fund (a) u/s 17-1 of B R Act (b) the amount to be transfer is 20% of such profits (c) profits for this purpose are after payment of dividend (d) Central Govt. can exempt a bank from such transfer on RBI recommendations. Which of these is correct:

24. Which of the following information regarding return of service tax is correct:

25. If a security is in possession of a bank, it can be sold by the bank:

26. Central Govt. can make rules for preservation of records / books u/s ______ of B R Act, RBI can make rules u/s ______ of B R Act and banks can return the paid instruments to customers u/s ________ of B R Act.

27. A banking company can amalgamate with another banking company of its own, called ______ amalgamation. Central Govt. can also order amalgamation of two banking companies u/s 396 of _______, in consultation with _______.

28. Which of the following provisions of SARFAESI Act were amended in the year 2004 after Chemicals vs Union of India and others, judgement of Supreme Court:

29. Under provision of SBI Act 1955, SBI is managed by (a) Board consisting of Chairman, Vice Chairman, maximum two Mg. Directors etc (b) Chairman and Mg. Director are appointed for a period not exceeding 5 years (c) Local Boards are set up where the bank has Local HO (d) Local Boards consists are set up where the bank has Local ho (d) Local Boards consists of Chairman and other elected and nominated members:

30. A Lok Adalt has jurisdiction:

31. Which of the following does not match:

32. Under provisions of SARFAESI Act, the security receipt evidences:

33. A bank has made payment across the counter, of a cheque issued as a crossed cheque and the holder claims damages from the bank. Under such circumstances, the bank is liable:

34. A bank makes payment of two cheques on which, later it is found that the signatures of the drawer are forged. The first account is that of a company and the 2nd account is a joint account in which signatures of one of the account holders are real.

35. Under FEMA, the term authorized person means:

36. Banks can issue notice for enforcement of security interest under SARFAESI Act when:

37. X appointed Y as his agent to operate his account and route business transactions through Y’s personal account also. Y misappropriated the proceeds of a cheque in the name of X but deposited by Y in his personal of a cheque in the name of X but deposited by Y in his personal account. X sends notice to the bank for negligence and conversion

38. Which of the following is not correct with regard to a deferred payment guarantee:

39. Bank X gives a bank guarantee on behalf of one of its customers against some payment to be deposited by the customer in a pending court case. Such guarantee can be classified as (a) financial guarantee (b) performance guarantee (c) deferred payment guarantee (d) statutory guarantee.

40. As per FEMA 1999, the term foreign exchange does not include which of the following:

41. For a securitization company, which of the following condition is applicable for their capital and capital adequacy ratio:

42. To enable the beneficiary to rely on the authenticity and genuineness of the LC, the letter of credit is received by the beneficiary:

43. In a LC the documents are to be negotiated in the beginning of September which means that documents can be presented for negotiation during:

44. If there is a contravention of provisions of FEMA 1999 by a person and the amount is not quantifiable, penalty can be levied:

45. A security interest created under SARFAESI Act requiring registration with Central Registry with a period of:

46. If a bill of exchange is dishonoured (a) the drawer is liable to the holder (b) drawer’s liability is secondary if it is accepted (c) drawer’s liability is primary when it has not been accepted (d) drawee is liable whether he accepts the bill or not in all circumstances. Which of these is correct:

47. Which of the following types of charges on the following securities does match:

48. (a) an equity shares is a share which is not a preference share (b) a preference share is one which gets regular dividend irrespective of profit position and preference in case of liquidation (c) debenture is document by which a company acknowledges its indebtedness (d) trust receipt is a document is an undertaking by the borrower when the goods are released by the bank toi the borrower without payment being made by the borrower:

49. Which of the following statements is correct:

50. The mortgage in which the mortgager transfers the possession to the mortgage is called ______ mortgage. In such mortgage, (there is) / (there is no), personal liability of the mortgager.

51. A mortgage when created through an instrument in writing (called mortgage deed) is required to be registered with _____ within _____51. A mortgage when created through an instrument in writing (called mortgage deed) is required to be registered with _____ within _____ months, if the value of mortgage money is Rs.______. months, if the value of mortgage money is Rs.______.

52. Which of the features of limited liability partnership is not correct as per LLP Act 2008:

53. XYZ created equitable mortgage in favour of Bank A on Jan14, 2007 (not registered), a simple mortgage with Bank B on Jan 28, 2007 (and registered on mar 12,2007) and a simple mortgage with Bank C on Feb 10,2007 (and registered on Feb28,2007). The priority of mortgage in this case would be in the following order:

54. Under RTI Act 2005, the information can be taken in the form of:

55. In case of hypothecation, which of the following is not a correct statement:

56. Where forged notes or counterfeit currency has been used as genuine, record of such transactions is required to be maintained if the amount of such transaction is:

57. Which among the following can not be deemed to be a contingent credit facility:

58. In the context of partnership firms, which of the following is not true:

60. Under prevention of Money laundering Act 2002, which of the following can prescribe the nature of records to be maintained by a bank:

61. If a company does not want to include in its name, the words ‘limited’ it can do so u/s 25 of Companies Act 1956, after obtaining license from:

62. A charge which is created by a company on its present or future assets ans is not attached to a particular assets is called:

63. SARFAESI Act has been declared valid by Supreme Court but it struck down Section ______ of the Act, in the case of ______ vs______, which provided for deposit of 75% of the amount due to the bank before approaching DRT:

64. To bring them in true with the information technology Act 1999, which of the following Act has not been amended IT Act 1999:

65. Where a person wants to file a case under SARFAESI Act, it will approach _______ and for appeal, it will go to_______.

66. The term ‘security interest’ does not include the following, as far as SARFAESI Act is concerned:

67. In the process of securitization of NPA accounts, the qualifies institutional buyers are eligible to purchase security receipts issued by the secuiritisation company. QIB does not include:

68. Which of the following has the authority under SARFAESI Act to prescribe income recognition, accounting standards, provisioning norms for Securitisation or Reconstruction Companies:

69. What is the function of the public key out of the pair of keys used in an electronic signature:

70. When sake of security is made by the creditor under SARFAESI Act, the sale proceeds are to be utilized (a) first towards costs incidental to preservation and protection of security (b) dues of the secured creditor (c) surplus to person entitled there to in accordance with the rights and interests.

71. In a securitization transaction the following documents are required (a) offer document (b) debenture (c) agreement (d) security receipt (e) discharge certificate by the NPA selling bank:

72. After receipt of notice of possession from the bank, if the borrower transfers, other than in normal course of business, any of his assets without consent of the bank, what is the punishment under SARFAESI Act:

73. When a request for information is rejected by Public Information Officer under right to Information Act, he is not required to communicate to the requester:

74. As per Rules under Prevention of Money laundering Act 2002, the banks are not requires to obtain which the following documents while opening account of a company:

75. The provision of SARFAESI Act are applicable in which of the following transactions:

76. Under provisions of Right to information Act, where the information is supplied by a 3rd party and is treated as confidential by that 3rd party and this information is sought by any person, the Public Information Officer shall give a notice within ____ from date of receipt of such request, to such 3rd party about his intention to disclose the information:

77. A complaint that is made to Ombudsman should not relate to an issue (a) already settled by Ombudsman (b) pending with a court (c) already decided by a court (d) where limitation period has expired. Which of the following options is correct:

78. The presiding officer of DRT is called ______, who is appointed by ______ for _______ or until he achieves age of ______.

79. When suit is filed by the bank with DRT, DRT summons the defendant requiring him to show cause within ______ days from _____ as to why the relief prayed by the bank, should not be granted:

80. In which of the following mortgages, the property is transferred by the mortgage absolutely with a condition for retransfer by the mortgagee:

81. where the borrower wants to file an appeal against order of DRT (which is not correct):

82. Which among the following is a correct statement:

83. Bank B has received a notice from Recovery Officer of DRT attaching the balance lying in current account of XYZ Pvt ltd.

84. When a bank is to send a certified copy of bank records to a court, the bank is to give a certificate that should contain (which is not correct):

85. The lease for an agricultural and manufacturing purposes is deemed to be a lease from year to year and it can be terminated by giving ______ notice:

86. Which of the functions of public and private key match:

87. Distt. Forus is headed by a person who be or has been qualified to be a _____ Judge. The other ____ members of not less than _____ years.

88. An agreement that cannot be enforceable by law is called:

89. A contract is valid only when there is valid consideration but in case of contract of guarantee, no consideration passes between the bank and the guarantee. The contract is still valid because:

90. Which of the following is true in the following cases:

91. In the execution of mortgage decree, the decree holder can bring the mortgaged properties to sale:

92. As a part of corporate governance, the concept of ‘fit and proper’ relates to which of the following aspects:

93. Under Sale of Goods Act, the term ‘caveat emptor’ stands for:

94. X sold certain goods to Y for which he is yet to be paid. As long as the payment is not made by Y,X has (a) lien on the goods for the price of the goods the possession of which is with X (b) if Y becomes insolvent, to stop the goods in transit if X has parted with the possession (c) right of re-sale if goods are in possession of X. which of these is correct:

95. A partnership is a contract with following features (which one is not correct):

96. X, the natural guardian of M, the minor, wants to mortgage the property in the name of M to secure a loan for the benefit of the minor:

97. The provisions in respect of enhancing the borrowing powers of the Board of a public limited company or subsidiary of a public limited company, by the shareholders, are given in section… of the Companies Act 2013:

98. As per SEBI guidelines, the minimum % age of independent directors out of total, should be ______, of a _______ company:

99. Your branch is approached by a public limited company to open a current account in their name. For the purpose of opening the account, they submit the Memorandum and Articles of Association and other papers along with a resolution passed by the Board of the company in a duly held meeting. It is observed from the Articles of Association that the Board of the company should have five directors for the purpose of business decisions, but the resolution has been passed by 4 directors, as the 5th one is away to UK in connection with a business trip:

100. Every public limited company must have a managing director or whole time director, where paid up share capital is: