JAIIB/Diploma in Banking & Finance Legal & Regulatory Aspects of Banking

JAIIB/Diploma in Banking &
Finance
LEGAL & REGULATORY
ASPECTS OF BANKING
MODULES C & D
01.. Identify which one is correct.

a.. A contract of guarantee has two persons
b.. A contract of indemnity has two persons.
c.. A minor can take an education loan as a
borrower
d.. A pledge in respect of company advance
has to be registered with ROC.
02..The award of a Banking Ombudsman

will be reviewed by
a.. The Executive Director of RBI
b.. The Deputy Governor in charge of Rural
Planning and Credit Department of RBI.
c.. The Finance Secretary
d.. The Banking Ombudsman himself
03..Which is not correct (Banking

Ombudsman)
a.. The maximum amount the Banking
Ombudsman can award as compensation
is Rs.10 lacs.
b.. Limitation period for filing of the review
application is one month.
c.. Failure to honor guarantee does not
come under its purview .
d.. None of the above
04..Means an agreement reached by the

parties either by conciliation or mediation
under the scheme (Banking Ombudsman)
a.. Mutual agreement
b.. Mutual Consent
c.. Reconciliation
05..Which one is appropriate (Banking

Ombudsman)
a.. A complaint can be lodged by a bank on
another bank
b.. Complaint can neither be given in writing
(manually) nor electronic means
c.. RRB is not within the purview of this scheme
d.. Central Government is the authority to appoint
a Banking Ombudsman
06.. A complaint alleging deficiency in

banking service may be filed with the
Banking Ombudsman having the
jurisdiction
a.. Issue of drafts to customers and others
b.. Inordinate delay in collection of bills
c.. Both a & b
d.. Only b
07..No complaint to the Banking Ombudsman shall

lie unless the complainant had before making a
complaint to the Banking Ombudsman made a
written representation to the bank and either the
bank had rejected the complaint or the
complainant had not received any reply within a
period of one month after the bank concerned
received his representation or the complainant is
not satisfied with the reply given to him by the
bank.
08.. The complaint is made not later than

one year after the cause of action has
arisen.
..The complaint is not in respect of the
subject matter, which was settled through
the office of the Banking Ombudsman in
any previous proceedings
09.. If a complaint is not settled by agreement

within a period of one month from the date of
receipt of the complaint or such further period as
considered by Banking Ombudsman, he can
pass an award.
.. He shall be guided by the evidence placed
before him, the principles of law and practice,
directions, instructions and guidelines issued by
RBI from time to time to pass the necessary
award.
10..A person has applied for a loan . The bank has

not sanctioned the loan since the bank felt the
person was not eligible. The person
a.. Can approach the bank once again
b.. Cannot take up the matter with the bank
c.. Can refer the matter to Banking Ombudsman
d.. Can request Banking Ombudsman to instruct
the bank to sanction the loan
11.. A bank not agreeing to accept the Award

passed under the Banking Ombudsman
scheme may file a review application
before the Review Authority within one
month from the date of receiving copy of
the Award. Banks application to be
approved by the banks Chairman or in his
absence by the Managing Director or any
other officer of equal rank.
12..Reserve Bank of India appoint one or

more persons as Banking Ombudsman for
a period not
a.. Exceeding 4 years at a time
b.. Exceeding 3 years at a time
c.. Exceeding 2 years at a time
d.. Exceeding 1 year at a time
13.. Banking Ombudsman ( identify the odd one)

a.. Non-acceptance of applications for loans
without furnishing valid reasons to the applicant
b.. Refusal to accept taxes, as required by the
Government
c.. Acceptance of small denomination coins
tendered for any purpose
d.. Non-adherence to the fair practices code as
adopted by the bank
14..With regard to complaints relating to

credit card operations, the banking
ombudsman shall take into consideration
a.. The loss of complainants time
b.. Expenses incurred
c.. Financial loss, harassment and mental
anguish suffered
d.. All of these
15.. A copy of the award need not be sent to the

complainant under the Banking Ombudsman
Scheme.
a.. True
b.. False
c.. It has to be sent not only to the complainant but
also to the bank named in the complaint
d.. It is the discretion of the Banking Ombudsman
and not mandatory to send the copies of the
award
16.. The banks covered by the Scheme of

Banking Ombudsman has to appoint
specified officer at their Regional / Zonal
Offices.
a.. Not required
b.. Not essential
c.. Not specified officer
d.. None
17.. A complaint has been filed against a Bank

(Banking Ombudsman Scheme). The Banking
ombudsman directed the bank concerned to
furnish necessary information. Then it is to be
carried out by
a.. Designated officer of the bank for this purpose
b.. Nodal Officer of the bank
c.. Chief Manager or the person equivalent to his
position in the Regional / Zonal Office of the
bank concerned
d.. None of them
18.. Ashis Kumar is an Advocate. He is not satisfied with

the service of the bank which has delayed his collection
of cheque. He has taken up the matter with the bank
concerned. Since he has not got a proper response, he
has decided to approach Banking Ombudsman.
a.. He will not be entitled as per the scheme
b.. He can very well take up the matter
c.. There is bar for the advocate to involve themselves in
approaching Banking Ombudsman
d.. Asish Kumar has the option to request his friend
Advocate to represent him
19.. It has been observed by a customer while going though the entries
in the account (pass book), that the bank has debited wrongly his
account. On account of that the customer has to suffer.
He wish to refer the matter to Banking Ombudsman.
a.. He can, provided he takes up the matter first with the bank
concerned in writing
b.. Considering the seriousness of the matter there is no need to refer
the matter to the bank concerned that too in writing
c.. Straight away take up the matter with Banking Ombudsman and
intimate the Bank concerned
d.. Straight away take up the matter with Banking Ombudsman and
there is no need to intimate the bank, since Banking Ombudsman is
part of RBI which is always considered superior.
20.. Limitation period for filing of the review

application against the award of the
Banking Ombudsman is
a.. 90 days
b.. Not 90 days
c.. Not available since review is beyond the
purview of the scheme
d.. None
21..The Banking Ombudsman

a.. May reject a complaint, at any stage
b.. Can reject a complaint not before 45
days of receipt of such complaint
c.. Can not reject a complaint
d.. Has to pass an order in respect of any
complaint made to him and does not have
the powers to reject
22..Thorat is the agent of a bank who has assured that the

bank would extend certain specific services and
succeeded in giving a credit card to one Thomas. Later
on the bank has not provided the services assured.
Thomas can refer the matter
a.. Only to the bank concerned
b.. To the Banking Ombudsman after following the steps
required in the scheme
c.. Thomas cannot refer the matter to Banking
Ombudsman.
d.. Such complaints are beyond the purview of the scheme
23..Banking Ombudsman - A bank wish to

file an appeal before the Appellate
Authority. The same should be with the
previous sanction of the
a.. Board of Directors of the Bank
b.. Nodal Officer
c.. Designated Official
d.. None of these
24..A compensation claimed is around Rs.16 lacs in a

complaint filed against the bank. Then the matter
a.. Can also be brought under the Banking Ombudsman
Scheme
b.. Can be brought under the Banking Ombudsman
Scheme for compensation up to Rs.10 lacs and for the
balance to be taken up with the competent court
c.. Can not be brought under the Banking Ombudsman
scheme
d.. Can be brought under the Banking Ombudsman
Scheme as a special case based on merits
25..SARFAESI Act 2002, extends to whole

of India including the State of Jammu &
Kashmir. Also applicable to housing
finance companies.
.. The act is effective from 21.06.2002. It
also covers the earlier loans which were
outstanding.
26.. SARFAESI Act has

a.. Prospective effect
b.. Retrospective application
c.. Effect from 21st June 2002 only
d.. Effect from 21st June 2002 cases taken
up on that day and there after only
27..Based on the observation of the

Supreme Court in the Mardia Chemicals
vs Union of India case, the Government of
India issued notification amending the
provisions of the SARFAESI Act. The
amendment stipulates payment of 50%
amount instead of 75% as originally
enacted. (When appealed)
28..Bank Z had advanced on the collateral security of the

third party deposit receipt of N, to L. The bank has also
obtained a personal guarantee of D to secure the loan.
For recovery, Z can use the provisions of SARFAESI Act.
a.. Allowed
b.. Not allowed
c.. Since pledge and only personal securities the provisions
of the Act not applicable
d.. There may not be any need since the Fixed deposit can
be adjusted for the loan outstanding. Additionally
personal guarantee is also available for the bank
29.. The provisions of the SARFAESI Act will

protect the interest of the secured creditor
(lending banker) irrespective of
a.. Defective Documents and any type of
charge on the security
b.. Non availability of Limitation on the
documents
c.. Both a & b
30.. For a mortgaged property to sell the same

permission of the competent court essential. As
per provisions of SARFAESI Act
a.. The same continues
b.. The same is not continuing
c.. Since there is no intervention of court
contemplated under this Act, even for mortgaged
property, the secured creditor can sell the
property without courts permission
d.. Under the Act, the mortgaged property cannot
be considered at all.
31.. ABF Bank has advanced to a partnership firm. The

security include Pledge of Gold ornaments of one of the
partners, Hypothecation of vehicle and stock and Pledge
of Fixed deposit of the firm. The borrowing has not
become NPA though there is a default.
a.. Provisions of SARFAESI Act not applicable
b.. Provisions of SARFAESI Act applicable
c.. Provisions of SARFAESI Act not applicable for vehicle
and stock
d.. Provisions of SARFAESI Act applicable for vehicle and
stock but not for pledge of gold ornaments / Fixed
deposit
32.. Which one is not associated with

SARFAESI Act.
a.. Obligor
b.. Hypothecation
c.. Security Receipt
33..Which one is not coming under the purview of

SARFAESI Act.
a.. Moveable property under the possession of the
secured creditor
b.. Moveable assets under the possession of
the debtor who has offered the security to the
secured creditor
c.. Immoveable assets not under the possession
of the secured creditor
d.. Immoveable assets with the mortgagor
34..Identify the odd one (Securitization

matter)
a.. Hypothecation of stock
b.. Mortgage of Machinery
c.. Personal guarantee of the Managing
Director
d.. Goods in transit offered as security
35..Appellate Tribunal is constituted by

a.. Central Government
b.. As per the provisions of the appropriate
Act
c.. As per the provisions of the Recovery of
Debts due to Bank and Financial
Institutions Act.1993
d.. Both a & c
36..Take over of loans or advances from the

Bank or Financial Institution for the
purpose of recovery is known as Asset
reconstruction.
. The word Board is used in the Act refers to
the Securities and Exchange Board of
India (SEBI)
37.. The SARFAESI Act is applicable to

a.. Regional Rural Banks
b.. Nationalized Banks & Co-operative
banks
c.. State Bank of India and their Associate
banks
d.. Both b & c and not to a
38..Acquisition of any right or interest, of any bank

or financial institution, in any financial
assistance, by any securitization company or
reconstruction company, for the purpose of
realization of such financial assistance is known
as
a.. Asset Reconstruction
b.. Securitization
c.. Both a and b
d.. Reconstruction
39.. As per the provisions of the SARFAESI

Act, a borrower is one
a.. Who has obtained finance from a banker
b.. Who has given the guarantee for the
person (a)
c.. Who has created any mortgage in favor
of the bank for obtaining finance
d.. All of these
40.. SARFAESI Act applicable in respect of

a.. Temporary Over draft in a current
account
b.. Overdraft on the security of shares
c.. Both a & b
d.. Work in progress taken as security
41..Default should have been committed by

the debtor.
. The borrowers account should have been
classified as NPA as per the guidelines of
RBI.
. The Act is applicable only to a Secured
creditor and not to an unsecured creditor
42.. Bank U has lent to A a sum of Rs.5

lacs on the hypothecation of a van.
Identify the Originator as per the
provisions of the SARFAESI Act.
a.. Borrower A
b.. Bank U
c.. Neither A nor U
d.. Debtor A
43.. He is the owner of a financial asset that

is acquired by a securitization or
reconstruction company for the purpose of
securitization or asset reconstruction.
a.. Originator
b.. Lending Bank
c.. Lending Financial Institution
d.. All the three
44.. Obligor is a person liable to pay to the

lender (originator).
As per the contract terms and conditions
or otherwise.
He has to discharge any obligation in
respect of a financial asset whether
existing, future, conditional or contingent
or and includes a borrower.
45.. Identify the Obligor in respect of a loan

given to one N by bank J. The security
offered by N include his gold ornaments,
two wheeler and collateral security of his
flat.
a.. N
b.. J
c.. N & J
d.. None
46.. Under the provisions of the Act

(SARFAESI) which one is not considered
as Property
a.. Future Receivables
b.. Know how
c.. Land
d.. None of these
47.. Qualified Institutional Buyer (odd one)

a.. Bank
b.. Insurance company
c.. A CEO of a leading MNC
d.. An Asset Management Company
48..Which one is not pertaining to

Hypothecation.
a.. A charge in or upon any movable
property
b.. Right in favour of the creditor
c.. Possession also with the lender
d.. Retaining the ownership with the owner
of the property
49.. The securitization company or reconstruction

Company to raise funds from qualified
institutional buyers by formulating schemes.
.Separate scheme wise accounts to be
Maintained.
.The Scheme invites subscription to security
receipts proposed to be issued by such company
under the scheme.
50.. Bank R is the secured creditor and W is the

borrower who happens to be the defaulter .The
branch head is C. W has given his land as
security which is under his possession. The
outstanding liability is shown under NPA. Identify
the Obligor & Originator.
a.. R and C respectively
b.. W and R respectively
c.. W and C respectively
d.. R and W respectively
51.. Who will receive the Security receipt from

whom.? (SARFAESI Act)
a.. Secured Creditor from Principal Debtor
b.. Institutional Investor from Securitization
company.
c.. Securitization company from Institutional
investor
d.. Secured Creditor from Reconstruction
company
52..Identify the regulatory authority for all

securitization and reconstruction
companies.
a.. SEBI
b.. RBI
c.. Company Law Board
d.. IRDA
53..GNMV, the secured creditor. After completing

the formalities / procedures (as per SARFAESI
ACT) the assets mortgaged by RJJH were
purchased by a Securitization and
Reconstruction company called JFI for Rs.30
lacs. Then
a.. JFI will issue a security receipt to GNMV
b.. GNMV will receive debentures from RJJH
c.. RJJH will issue security receipts to JFI.
d.. GNMV will get debentures from JFI
54..In Mardia Chemicals vs Union of India

Supreme Court as declared that
A.. SARFAESI Act is Constitutionally valid
B.. Except a part of Section 17(2)
C.. To Deposit 75% for appeal, the Apex
court was not in favor
D.. All the above
55.. A reconstruction company
a.. is engaged as property developer

b.. is formed for the purpose of
asset reconstruction
c.. is registered with SEBI
d.. is not registered under the
Companies Act
56..The Government of India has
a.. issued an order

b.. issued a notification amending the
Sec17(2) of SARFAESI Act.
c.. Instead of 75%, the borrower filing
an appeal has to deposit 50%
d.. Both B & C are appropriate
57..A Mutual fund, an Asset Management

Company and a Foreign Institutional Investor
would like to invest in Securitization and
Reconstruction company as as qualified
institutional buyers. Then they will have to
a.. Register with SEBI
b.. Register with SEBI is not a must
c.. Register with SEBI is a must
d.. Register with SEBI when directed only
58..J F D a Securitization and reconstruction

company acquired financial asset from
PNM, a secured creditor. In view of the
same, JFD would become
a.. Purchaser
b.. Seller
c.. Owner
d..
None of these
59..The Securitization Company not only to
be registered under the Companies Act but

also needs registration from RBI as per
A.. RBI Act

B.. Companies Act
C.. SARFAESI Act
D.. SEBI Act
60.. A person who is holding 15% of the paid up
equity capital of the reconstruction company is

known as
a.. Sponsor
b.. Obligor
c.. Originator
d.. Institutional investor
61.. Identify the beneficiaries of the trusts formed

by Securitization company. ICE is the
Securitization company. GZH is the Secured
creditor. BDE is the Institutional investor.
a.. GZY
b.. BDE
c.. ICE
d.. None of them
62.. A security receipt is

A.. Similar to Banks Term Deposit receipt
B.. Issued to Securitization Company
C.. Issued by Securitization Company
D.. Issued to a Secured Creditor and also to
an Institutional Investor
63... The Securitization company can acquire financial
asset without execution of any deed of assignment or

transfer in its favor by the original creditor.
a.. True
b.. False
c.. Without agreement it cannot be legally
valid
d.. Deed of Assignment is a must.
64.. Debenture as per the provision of SARFAESI

a.. Appears on the left hand side of the balance
sheet
b.. It is shown as liability representing
commitment
c.. It is for payment of consideration to be
paid to the bank for acquisition of financial
asset from it
d.. It represents the money borrowed.
65..SARFAESI Act
a.. Security Receipt issued by Securitization
Company
b.. Security Receipt is not issued to a
Secured Creditor
c.. Security Receipt is issued to Institutional
Investors who are also called Qualified
Institutional Buyers
d.. All the above
66.. Identify the incorrect one (Reconstruction

Company)
a.. It has to obtain registration certificate from
RBI.
b.. It has to have minimum capital of Rs.100 crores
at the time of registration
c.. It can formulate separate schemes for
acquisition of financial assets
d.. It has to disclose the risk factors to the
investors.
67.. The Security receipt (not having any interest or right
and so on in immovable property) issued to the holder

by the Securitization company attract registration as per
the Registration Act,1908.
a.. True
b.. False
c.. Registration compulsory for such
receipts.
68..As per the provisions of the SARFAESI

Act, the charge against property to be
registered with
a.. Registrar of Companies
b.. SEBI
c.. RBI
d.. None
69.. A Limited Company has been

sanctioned a Bills limit and the outstanding
liability has been classified as NPA. Then
the provisions of SARFAESI Act includes
a.. Book debts
b.. Assignment of Book debts
c.. Hypothecation of Book debts
d.. None
70..Bank G E H has advanced to SSS a sum of

Rs.2.75 lacs. It has been classified as NPA.
OPQ a Securitization company has shown
interest to take over the assets offered by SSS
as security to Bank G E H. Identify the Secured
Creditor, Who will issue Debenture to whom and
the Debtor.
a.. G E H , OPQ to G E H and SSS
b.. G E H , OPQ to SSS and G E H
c.. G E H , G E H to OPQ and SSS
d.. G E H , SSS to OPQ and G E H
71.. Whenever any lender takes any security

from the borrower, the lender gets interest
in that security. As per the SARFAESI Act
this is known as
a.. Secured interest
b.. Charged interest
c.. Secured creditors interest
d.. None of these
72..ABC and co has not paid the debt. Declared

NPA. Securitization process held. The secured
creditor JIT has handed over the security to the
securitization company STB. Then ABC paid
some amount.
a.. JIT can use the funds so got
b.. JIT has to hand over the same to ABC
c.. JIT has to hand over to STB
d.. None
73..This evidences the purchasers

undivided right, title and interest in the
security.
a.. Deposit Receipt
b.. Security Receipt
c.. Both a & b
d.. Only a
74.. A securitization company is

contemplating to change its name.
a.. They can do so by informing the
appropriate authority
b.. Seek approval from SEBI after the
change
c.. Needs prior approval from the Company
Law Board
d.. None
75..Securitization or reconstruction companies

a.. Do invest their own funds to acquire assets
b.. Do not invest their own funds to acquire assets
c.. Use the money invested on risk assessment
and act on careful considerations for asset
acquisition decision.
d.. Excepting a other two are appropriate
76..Cancellation of Certificate of Registration for a

Securitization company possible (odd one)
a.. The company ceases to receive or hold any
investment from a qualified institutional buyer.
b.. The company continues to receive or hold any
investment from a qualified institutional buyer.
c.. The company fails to comply with any of the
directions issued by the Reserve Bank
d.. The company fails to obtain prior approval of
Reserve Bank of India for change in
management
77..The securitization or reconstruction company

whose registration is cancelled can prefer an
appeal within 45 days from the date of
communication of order, to Reserve Bank of
India Governor . The company is required to be
given a hearing before rejecting the appeal.
a.. Appropriate
b.. Not 45 days but 30 days and Not RBI but
Central Government
c.. Only change is 30 days instead of 45 days
d.. Not RBI but Central Government
78..The securitization transaction involves

a.. Acquisition of financial assets and
undivided interest therein
b.. Issue of security receipts in favor of the
investors for the purpose of raising money
from investors.
c.. Both a and b
d.. None
79..This, for the payment of consideration, is

to be paid to the bank or the financial
institution for the acquisition of financial
asset from it.
a.. Debenture
c.. Security Deposit
d.. Security Interest
80..Under the Securitization process,

debenture issued period not to exceed
a.. 5 years
b.. 6 years
c.. 7 years
d.. 9 years
81.. Under the Securitization process the debenture

a.. To carry interest which cannot be less than one and half
percent above the Bank Rate as on the date of issue of
the debentures
b.. To carry interest which cannot be more than one and
half percent above the Bank Rate as on the date of
issue of the debentures
c.. To carry interest which should be equal to the Bank
Rate as on the date of issue of the debentures
d.. Not to carry any interest
82.. XZY bank has decided to dispose off the

security to a Securitization company BDG for
consideration. The debtor being a Limited
company (RTU(P) Ltd.,). XZY has decided to
give a notice to the debtor.
a.. XZY to give notice to ROC as well
b.. XZY need not give any notice to ROC
c.. Giving notice is not compulsory
d.. Giving notice is optional and hence there is no
need for XZY to give a notice to ROC
83..If there is a dispute among the bank,
securitization company and the qualified

institutional buyer, then the same to be settled
by conciliation or arbitration as provided in the
a..
b..
c..
d..
Reserve Bank of India Act

SARFAESI Act
Arbitration and Conciliation Act
Both a & c
84..An institutional investor MNG wish to transfer

the security receipt (Which has an undivided
interest in the financial asset) to MVN.
a.. Registration under the Registration Act
required.
b.. Registration optional
c.. Registration need not be insisted.
d.. Registration of Security receipts does not arise.
85..If the cause of default in a unit is any

mismanagement or lack of expertise on
the part of the existing management, the
securitization or reconstruction company
has the powers to take over the
management or change the management.
This power can be exercised even when
there is no default
86.. The power given to the secured

creditor, as creditor has overriding effect
over the provisions related to mortgage in
a.. The Registration Act
b.. The Contract Act
c.. The SARFAESI Act
d.. The Transfer of Property Act
87..The Securitization company can set up

separate trusts scheme wise and act trustees for
such schemes as provided in the Securitization
Companies and Reconstruction Companies
(Reserve Bank) Guidelines and Directions,2003.
The beneficiaries of such trusts are
a.. Debenture holders
b.. Lending bankers
c.. Debtors
d.. None of them
88...Acquisition of financial asset from the

originator, by Securitization or
reconstruction company is known as
a.. Reconstruction
b.. Securitization
c.. Transfer of Assets
d.. Purchasing
89.. Securitization company is a company

registered under the Companies Act,1956 for the
purpose of securitization. It also needs
registration from RBI under the provisions of
SARFAESI Act.
.. Security agreement includes an agreement,
instrument or any other document or
arrangement under which security interest is
created in favor of secured creditor
90.. The minimum capital requirement for

securitization or reconstruction company,
at the time of registration is
a.. Rs. 30 Crore
b.. Rs. 75 Crore
c.. Rs.100 Crore
91..TT has created a mortgage by way of

deposit of title deeds with the secured
creditor bank JJ. This represents
a.. Security Receipt
b.. Secured Debenture
c.. Security Agreement
d.. Secured Debt
92..Secured debt means a debt which is

secured by any security interest.
..Secured Asset means the property on
which security interest is created.
.. The powers given by SARFAESI Act for
enforcement of securities are against
secured assets only
93..Security Receipt is issued

a.. To Debtor by the Secured Creditor
b.. To Qualified Institutional buyer by the
Reconstruction Company
c.. To Securitization Company by the
Secured Creditor
d...To Securitization company by the
Reconstruction company
94. .Which one is appropriate. (SARFAESI)

a.. RJS is the institutional investor and will receive
Bonds in lieu of Debentures
b.. TRK is the Securitization company will issue
Security receipt as well as Debentures
c.. GU is the Secured creditor and will receive
security receipt from the secured debtor
d.. JNS a borrower of the bank will handover
Debenture in lieu of payment towards
outstanding
95.. Depending on the nature of security asset RBI

has the powers to specify different amounts of
owned funds for different companies.
..The company can formulate separate schemes
for acquisition of financial asset.
.. The securitization or reconstruction company
can act as trustees for such trusts and manage
the assets held in trust.
96..STV a Securitization and Reconstruction

company wish to have funds by way of
deposits.
a.. They can approach public for the same.
b.. Cannot raise funds by way of deposits
c.. If need arises with the permission of RBI
d.. They can raise funds by way of Deposits
on Private placement basis only.
97..The Securitization or reconstruction company

can acquire financial asset without execution of
any deed of assignment or transfer in its favor
by the concerned bank or the financial
institution.
.. Assignment is complete on the acquiring
company issuing debenture or bond and
incorporating therein the terms and conditions of
acquisition.
98.. As per RBI guidelines,

a.. an acquisition of funded assets should not
include take over of outstanding commitments,
if any, of any bank or financial institution to lend
further.
b.. terms of acquisition of security interest in nonfund based transactions should provide for the
relative commitments to continue with bank or
financial institute till demand for further funding
arises
99..Which one is correct (Securitization matter)

a.. Security receipt is not in favor of investor
b.. Security receipt is issued with permission from
Company Law Board
c.. Security receipt can be transferred by the
secured creditor
d.. Security receipt is issued in favor of the
institutional investor
100..Bank F decides that the financial asset now

be acquired by the securitization company VR.
The Asset was given as security by L , an
individual. In such an event, a notice of such
development to be given to
a.. L and such notice is not compulsory.
b.. Such notice is not optional
c.. The Obligor, which is compulsory as per the Act
d.. VR
101.. If the obligor is a company there is no

need for modification of charge, when the
notice regarding acquisition of financial
asset by a securitization company, is not
given to the debtor company.
However, if such notice is given to the
obligor company, then notice to the
Registrar of companies becomes essential.
102.. Bank J had advanced to U who had defaulted leading to a

securitization company acquiring the financial asset. In fact no
notice has been issued to U. After some time, U remits some
amount towards his dues to J from where he had availed the
financial facility.
a.. J to retain the funds
b.. J has an obligation to remit to the securitization company
c.. J first of all should not accept such payment since his contract with
U is over on account of securitization transaction.
d.. J has to find out the reason why U had not paid earlier when the
liability was outstanding with them.
103..The securitization or reconstruction company

raises funds for acquisition of asset by issue of
security receipts. Public/individual investors
are barred from investing in a securitization or
reconstruction company by the Act.
.. Realization of the asset is held and applied
towards redemption. i.e., repayment of
investments as assured while issuing the
security receipt.
104.. In case there is no realization and repayment by the securitization

or reconstruction company, then the qualified institutional buyers are
entitled to call a meeting of all qualified institutional buyers making
investments in that scheme and the resolution passed in the
meeting.
a.. The first institutional buyer has the right to call for such meeting
b.. The qualified institutional buyers holding not less than 75%
of the total value of security receipts has the right
c.. Any one of the Institutional investor who takes the lead gets the
priority
d.. The Institutional Investor identified and nominated by RBI for this
purpose has the right
105..NPN has got a security receipt from a

securitization company called BCB. NPN wish to
retain the security receipt. Then
a.. Such security receipt need not be registered
b.. Such security receipt has to be registered
c.. Such security receipt cannot be transferred
d.. Such security receipt has to be retained by
NPN who is the original institutional investor and
hence there is no question of registration / non
registration.
106..Asset reconstruction means acquisition

of any right or interest of any bank or
financial institution in any financial asset
for the purpose of realization. Powers to
take measures for asset reconstruction
are given without any prejudice to the
provisions contained in any other law
107.. The SARFAESI Act is silent about the

grounds or reasons on the basis of which
action of acquisition can be taken.
Therefore, loan agreements between
bank/financial institution and the borrower
are required to be taken into account as
provisions of this do not have overriding
effect on existing contracts and laws.
108.. When the asset is acquired for

reconstruction there is limit of six years
for such reconstruction.
a.. Correct
b.. Incorrect
c.. Not 6 years but 5 years
d.. It is 7 years and not 6 years
109..RTM a Securitization company is

taking over the financial asset from the
secured creditor BB. Then BB will get
a.. Debenture
c.. Commitment
d.. None of these
110..Which one is incorrect

a At the time of enforcing securities as per the provisions
of SARFAESI Act, the Securitization company may itself
acquire secured assets for use or resale, if such resale is
through a public auction.
b.. The Securitization company is permitted to set up trusts
who can issue security receipts.
c.. While issuing security receipts detailed disclosures are
not required to be made by the Securitization company
d.. While issuing security receipts detailed disclosures are
required to be made by the reconstruction company.
111..A Securitization company can act as a

receiver
a. If appointed by any Court
b. If appointed by any Tribunal
c. If appointed by the Central Government
d. Either a or b
112..Which one is correct (Securitization aspect)

a.. During the planning period (which is 12 months)
an asset can be classified as Standard Asset
b.. Non performing Asset is linked to the securitys
strength or weakness and not to over due period
c.. Maintaining capital adequacy optional
d.. Raising funds by way of deposits not prohibited
113..Provisions of mandatory arbitration and

conciliation not applicable to the dispute
by or against
a.. Secured Creditor
b.. Obligor
c.. Qualified Institutional Investor
d.. Securitization or Reconstruction
Company
114..Who has the powers to issue

guidelines under the SARFAESI Act
a.. SEBI
b.. RBI
c.. Central Government
d.. Law Ministry
115 ..Under the SARFAESI act a secured

creditor can enforce the security interest
created in his favor without the
INTERVENTION
of the Court or Tribunal.
..The act deals with how the notice to be
given by the secured creditor asking for
repayment of the out standings.
116..The secured creditor bank to give a notice

asking the debtor to clear the liability in full within
60 days from the date of notice.
.. The above is applicable to such debtors who
have defaulted and classified as NPA.
.. There is no bar for the creditor to seek the other
legal remedies such as resorting to filing of suit
in a competent court
117..Identify which one is not incorrect. (SARFAESI Act)

a.. Notice as per the provisions of the act to be given to the
Creditor.
b.. Notice as per the provisions of the act is a statutory
notice.
c.. The Act does contemplate a reply form the borrower to
the notice.
d.. When the offer of sale of property is accepted by the
purchaser and the secured creditor accepting the offer
confirms the sale, the purchaser need not deposit any
token deposit of the offer price.
118.. Bank DT has decided to invoke the relevant provisions

of the SARFAESI Act, by giving the first notice calling for
clearance of the dues. Then as per Sec 13(2) of the SARFAESI
Act the first notice to be given asking for clearance of full liability
within
a..
b..
c..
d..
30 days
60 days
60 days from the date of notice
60 days from the receipt of notice
119.. Debtor DD has been asked to repay outstanding liability of

Rs.25.73 lacs (as per provisions of SARFAESI Act) by his Secured
Creditor banker KK. DD has sent a reply in writing giving his sides
version. The bank responded to the notice and made their position
clear. Based on that reply, DD wish to file an appeal
a.. in the high court

b.. in the DRT
c.. Not possible / nor permissible
d.. In the appropriate court for their intervention
120.. For a Public Sector bank an Authorized Officer

a.. General Manager
b.. At least a Chief Manager
c.. Senior Branch Manager
d.. As identified and nominated by the
Board of Directors.
121..The secured creditor in an anxiety to recover his funds

would like to publish a possession notice without issuing
the first notice as per the relevant provisions of the
SARFAESI Act.
a.. Not Permissible
b.. Permissible
c.. Not necessary to issue any notice before releasing the
possession notice in a leading newspaper
d.. It is left to the Authorized Officer to take appropriate
action like issuing of possession notice to safe guard the
interest of the lending banker.
122..For classification of any account as NPA it is

important that the classification is done as per
A.. Directives of Head Office of the Bank
concerned
B.. Viewpoints of R B I
C.. Guidelines of the Concerned Banks Corporate
Office
D.. None of these
123..An authorized officer issues the second

notice as per the provisions of the
SARFAESI Act known as
a.. Recalling
b.. Possession
c.. Take Over
d.. Auction
124..If the offer of sale of property is accepted by the

purchaser and the secured creditor confirms then the
purchaser has to deposit
a..
b..
c..
d..
25%
75%
50%
No such pre condition
125..Which one is correct,

a.. The authorized officer has to publish
possession notice in two leading newspapers.
b.. Both papers should be in vernacular language
c.. Before 60 days of sale of immovable property
the borrower should be given notice about the
sale
d.. If the price of secured asset is coming less
than the reserve price, the authorized officer to
sell the asset at a lower price with the consent of
creditor only and not that of the debtor
126..The authorized officer is authorized to

issue sale certificate. Such certificate is
conveyance of immovable property and
requires stamping as per the provisions of
Stamp Act.
a.. True
b.. False
c.. Relevant State Laws
d.. Central Laws
127.. As the powers of enforcing securities need to

be exercised prudently, fairly and with due care
and caution the Rules framed under SARFAESI
Act provide that Authorized Officer should be of
the level equivalent to Chief Manager of a public
sector bank or equivalent or any other
authorized person exercising powers of
superintendence, direction and control of the
business or affairs of the creditors, as the case
may be
128..For taking possession and then sale of

immovable property, the secured creditor is
required to serve a possession notice on the
borrower and by affixing the possession notice
on the outer door or at the conspicuous place at
the property.
..The authorized officer is required to publish the
possession notice in two leading newspapers,
one of which should be in vernacular language.
129..Kamath is the Authorized officer of a bank. The price

for secured asset (Flat) is coming less than the reserve
price, then Kamath decides to sell the asset at a lower
price to the highest bidder. Under the circumstances
a.. The decision of the Authorized Officer cannot be
questioned and his decision will be final
b.. He can take independent decision
c.. With the consent of the borrower and the secured
creditor, he has to take his decision
d.. Without consulting any one he can take his own
decision
130..When the secured creditor is required to take

possession or control of the secured asset or to
sell such secured asset, he can take the help of
the Chief Metropolitan Magistrate or District
Magistrate.
..For seeking their help a request in writing is
required.
..To approach the authority within whose
jurisdiction the secured asset or documents
related to it are situated.
131..When the secured creditor takes over the

management of business of a borrower, he may publish
a notice in a newspaper published in English language
and in a newspaper published in Indian language in
circulation in the place where the principal office of the
borrower is situated, for appointment of
a.. If the borrower is a company as defined in the
Companies Act, 1956 to be the directors of such
company, or
b.. In any other case, to be the administrator of the
business of borrower.
132.Any person, including borrower,

aggrieved by any of the measures taken
by the secured creditor or his authorized
officer for taking possession of the security
may make an application along with the
prescribed fees to the Debt Recovery
Tribunal having jurisdiction within 45 days
from the date on which such measures
are taken.
133..As per the provisions of the SARFAESI

Act, the DRT has to dispose off the
application preferred seeking justice,
within a period of
a.. 30 days
b.. 45 days
c.. 60 days
d.. 90 days
134..As per the provisions of the SARFAESI act, against

the DRTs order, appeal can be filed to the appellate
Tribunal within 30 days from the date of receipt of the
order of Debt Recovery Tribunal. The Tribunal has the
powers not to entertain such an appeal unless the
borrower deposits 75% of the debt claimed by the
secured creditor. (Now stands reduced to 50%)
a.. True
b.. False
c.. Neither 75% nor 50 % but 25%
d.. Continues to be not less than 50%
135..A secured creditor is seeking justice under the

provisions of the SARFAESI Act. Stage is set for
preferring an appeal before the DRT. The amount in
dispute is Rs.7.87 lacs
a.. DRT does not have the power to entertain such appeal
b.. Since jurisdiction of DRT is Rs.10 lacs and above what
is stated in (a) is appropriate
c.. Since it is SARFAESI matter, DRT will have to take up
the appeal
d.. Such appeals to go to Civil Court and not to DRT in view
of the claim amount (which is less than Rs.10 lacs)
136.. SARFAESI Act is not applicable to

a.. Urban Co operative Bank
b.. Nationalized Bank
c.. State Bank of India Associate Bank
d.. None of these
137.. The security asset has been sold then the proceeds
to be appropriate at first
a.. Towards payment of cost, charges and expenses for the
preservation and protection of securities including
payment of appropriate insurance charges and so on
b.. Towards legal charges incurred by secured creditor
c.. Towards the satisfaction of dues of the secured banker
d.. Towards payment of fees to the Authorized Officer and
his team of officials and support staff
138..B has given his personal guarantee to a loan taken by

a debtor D. The loan was provided by Bank G. As security
D gave his asset (hypothecation). Since the loan became
NPA, G took up Securitization measures.
a.. B can object that SARFAESI Act provisions not
applicable to him
b.. B cannot object since the SARFAESI Act provides that
the Creditor can also call for payment due to the borrower
from the third party
c.. B can object that SARFAESI Act not applicable to him
and hence the secured creditor cannot seek remedy
under the Act when a guarantor is involved
d.. B cannot object to the action of the secured creditor
since the measures taken are mainly against D
139.. Registration with Central Registry

(Under SARFESI) is not required on
certain things and charges. Identify the
Act.
a.. Merchant Shipping Act,1958
b.. Patents Act,1970
c.. Designs Act 2000
140..Identify which one is incorrect (Central

Registry)
a.. Maintaining the records of the Registry on
computers in permissible under SARFAESI Act.
b.. Registration under the Act is in substitution of
the other registrations under different laws
c.. Registration under different laws will have
priority of charge depending on the provisions of
respective registration laws
d.. Creation of security interest to be registered
under the provisions of the Act.
141.. A security interest has been created

on 14th of this month. Then it is to be filed
with the Central Registrar within
a.. 30 days after the date of transaction
b.. 45 days after the date of transaction
c.. Any time before the next step is taken to
dispose off the security
d.. 60 days after the date of transaction
142.. The particulars required to be filed by

the securitization or reconstruction
company or the secured creditor, as the
case may be. The delay in filing the
required particulars can be condoned by
the Central Registrar for a period of next
30 days after the first thirty days
prescribed, on payment of fees not more
than 10 times of the prescribed fees
143.. A security interest is registered with the

central registrar with delay. However the delay
was duly condoned and after remitting the fees
along with penalty the work was got done. Now it
requires to be modified. Then it is not the duty
of
a.. Secured Creditor
b.. Reconstruction Company
c.. Secured Debtor
d.. Securitization Company
144.. The borrower Keshav & sons repaid in

full the debt. (Securitization process since
taken) Then the secured creditor DD bank
has to file
a.. Registration of Security Interest
b.. Modification of Security Interest
c.. Satisfaction of Security Interest
d.. All the above in the same order
145..A record to be maintained at the Head

Office of the Central Registrar to record
transactions relating to
a.. Securitization of financial assets
b.. Reconstruction of financial assets
c.. Creation of security interests
d.. All the three
146..The Central Registrar has received the

satisfaction of charge (security interest) from the
secured creditor within the prescribed period,
then
a.. He can proceed to satisfy the charge
b.. He can call for show cause not exceeding 14
days before proceeding further
c.. He can call for show cause not exceeding 30
days before proceeding further
d.. He has to issue satisfaction certificate within 7
days
147.. Having cleared the dues with secured

creditor (securitization measures since
initiated under the Act) the borrower has to
file the satisfaction with the Central
Registrar within 30 days.
a.. True
b.. False
c.. It is the duty of the Secured creditor
d.. It is not the duty of the Debtor
148.. RKK a Reconstruction company failed to comply

with some of the directions issued by RBI. Then RKK is
punishable by RBI with fine not exceeding Rupees Five
lacs for the default. For further continuation of the
offence an additional fine is up to Rs.2000/= per day of
default can be imposed.
a.. Partially Correct
b.. True
c.. Rs.5 lacs and Rs.10000/- per day respectively
d.. Rs.7 lacs and Rs 5000/- per day respectively
149..The provisions of SARFAESI Act not

applicable in respect of
a.. A pledge of movable within the meaning of the
Indian Contract Act,1872(sec172)
b.. Any right of an unpaid seller as per Sale of
Goods Act,1930 (sec 47)
c.. Any security interest created in an agricultural
land
d.. All the above
150..Which one is incorrect (Provisions of SARFAESI Act

not applicable )
a.. Creation of security interest in any vessel as defined
within the meaning of the Merchant Shipping Act,1958.
b.. Any case in which the amount due is less than twenty
five percent of the principal amount and interest there
under.
c.. Any security interest created on an hypothecation of
asset worth rs.6.5 lacs
d.. Creation of any security in any aircraft as defined in sec
2 of Aircraft Act 1934
151.. PNC
bank has sold the security after invoking

the provisions of SARFAESI Act. After that they wish to
proceed in the civil court as the liability outstanding is
Rs.6.88 lacs plus accumulated interest of Rs.2.42 lacs
a.. Not possible

b.. Possible
c.. Impossible
d.. Doubtful
152..Bank C has exhausted the measures of recovery through

SARFAESI Act provisions. Still there is a liability of Rs.7.38 lacs to
be recovered from GH . The original documents has life.
a.. C can still proceed in the Civil Court by filing a suit against GH.
b.. Since C has opted for Securitization process, has to satisfy with
whatever they could get by disposing of the security
c.. Once the SARFAESI Act provisions invoked by the secured creditor
and the proceedings over, automatically the creditor looses his
further rights against the debtor.
d.. Only C has to worry. Whereas GH need not worry for the balance
amount, since the security stands disposed off. Further by opting for
Securitization measures C has sealed the other options to recover
legally from GH
153..Bank DOM had lent Rs.9 lacs to one KU, a borrower

and obtained security in the possession of the debtor by
way of hypothecation. DOM had to use the provisions of
the SARFAESI Act which resulted in a recovery of Rs.
7.32 lacs only. Still the outstanding dues works out to Rs.
3.87 lacs. Then DOM
a.. Cannot proceed against KU under Civil Law
b.. Since the bank had availed the support of SARFAESI
Act has to forego the balance outstanding
c.. DOM should have applied their mind before invoking
Securitization Act
d.. The bank can proceed against the borrower under Civil
Law subject to the provisions of Limitation Act as well.
154..Bank KA has used the Securitization Act provisions

and could recover only Rs. 16 lacs . Still they will have to
recover Rs.11 lacs plus interest from SR. Fortunately for
KA the limitation period on the loan documents is intact.
a.. KA has to seek legal remedy through the Civil Court.
b.. Bank has to seek legal remedy through DRT
c.. KA has to forego since they have already availed the
legal avenue
d.. KA may have to approach the borrower straight away
and request him to settle the balance amount.
155. .Secured Creditor Bank Q has succeeded partially

recovering the debt. After completion they are left with
only personal security of the borrower L. However the
loan documents have become time barred . The balance
outstanding being Rs.10.83 lacs + interest and other
charges.
a.. Q will fail on legal grounds
b.. Q will succeed on legal grounds
c.. Q to move DRT
d.. Q to take up the matter with Banking Ombudsman
156..Whenever the Government makes a

rule under the SARFAESI Act, the rule is
so required to be kept before each House
of Parliament, while in session for a total
period of thirty days. Both the Houses
should agree to the rules as framed and
they can make modifications therein or
decide not to make the rules.
157..A borrower knows that the bank (secured

creditor) is contemplating to seek remedies
under the provisions of the SARFAESI act. He
decides to approach the court preventing the
creditor to proceed accordingly
a.. The borrower would not succeed in his attempt
b.. The borrower would succeed
c.. The court will entertain the borrowers
application
d.. The Secured Creditor can not proceed under
the circumstances
158.. Bank UT has advanced on the security of

book debts. Since the payment not forthcoming
they would like to proceed against the borrower
WX using the appropriate provisions of
SARFAESI Act.
a.. Assignment beyond the purview of the Act
b.. Assignment within the purview of the Act
c.. Bank UT can proceed based on (b)
d.. Bank UT can not proceed based on (a)
159.. Bank B a secured creditor has transferred

the security of the debtor LM to the securitization
company AY for an agreed sum and obtained
debentures. Since B has not got the money, B
can
a.. Ask LM to pay
b.. Not ask LM to pay
c.. Not ask LM to pay since in lieu of money they
have got the debentures
d.. Ask LM to pay in spite of getting debentures
from AY
160..During the process of Securitization

measures, the borrower JH has cleared the
entire debt taken from the secured creditor bank
BC. There are no other outstanding dues from
JH. Then
a.. JH should get all the securities free of charges
b.. BC to release their right on the securities
c.. Both a & b
d.. BC can still hold the securities for the future
finance of JH
161..Identify the one which is appropriate (SARFAESI Act)

a.. The authorized officer has to give a notice 30 days
before sale of the immoveable property to the borrower
about the sale
b.. There is no need to give a separate notice to the
borrower about the sale of immoveable property and no
time limit stipulated.
c.. In case of immoveable property, the purchaser has to
deposit at least 50% of the amount within a reasonable
period
d.. The authorized officers duty to obtain Sale certificate
from the Registrar and hand over to the purchaser
162..The date agreed upon by the secured

creditors representing not less than three-fourths
in value, of the amount outstanding on such
date. Any decision taken by such creditors is
then binding on all other remaining creditors.
a.. Recorded Date
b.. Record Date
c.. Agreed Date
d.. Appropriate Date
163..Asset reconstruction means acquisition

of any right or interest of any bank or
financial institution in any financial asset
for the purpose of realization. Powers to
take measures for asset reconstruction
are given without any prejudice to the
provisions contained in any other law.
164.. If the cause of default in an unit is

mismanagement or lack of expertise on
the part of the existing management the
securitization or reconstruction company
has the powers to take over the
management or change the management.
This power can be exercised even when
there is no default.
165..The SARFAESI Act is silent about the

grounds or reasons on the basis of which
action of acquisition can be taken.
Therefore, loan agreements between
bank/financial institution and the borrower
are required to be taken into account as
provisions of this do not have overriding
effect on existing contracts and laws.
166.. If a complaint is not settled by agreement

within a period of one month from the date of
receipt of the complaint or such further period as
considered by Banking Ombudsman, he can
pass an award.
.. He shall be guided by the evidence placed
before him, the principles of law and practice,
directions, instructions and guidelines issued by
RBI from time to time to pass the necessary
award.
167.. A person duly appointed and

authorized by a complainant to act on his
behalf and represent him before a
banking ombudsman, for consideration of
his complaint is
a.. An Aggrieved Person
b.. Appointed representative
c.. Authorized representative
d.. Constituted representative
168..The Banking Ombudsman Scheme is

in force wef
a.. 1 January 2002
b.. 1 January 2003
c.. 1 January 2005
d.. 1 January 2006
169.. E is the NRI having a Non Resident External Account

in one of the cities in India. He has sent a remittance.
There has been in ordinate delay on the part of his
banker in India to credit the proceeds. He had taken up
the matter with the bank. The response has been very
very poor. E
a.. Cannot take up the matter with Banking Ombudsman
b. Can take up the matter with Banking Ombudsman
c. Since E is not in India he looses the opportunity to avail
the benefit of Banking Ombudsman scheme
d. At the most E can once again refer the matter to his
banker only and his case is beyond the purview of
Banking Ombudsman Scheme
170..Identify the odd one ( Banking

Ombudsman)
a.. Delay in payment of inward remittances
b.. Levying charges with prior intimation to
the customer concerned
c.. Non- observance of Reserve Bank of
India directives on interest rates
d.. Refusal to open a Recurring deposit
account in the name of the minor
171..A complaint under the Banking

Ombudsman scheme can be
a.. Given only by the affected person
b.. Given only by the complainant
c.. Given by the Authorized representative
d.. Any one of the above
172.. For a Debt Recovery Tribunal, the Presiding

Officer holds office for a term of 5 years from the
date on which he enters upon his office or until
he attains the age of 62 years, which ever is
earlier.
a.. Correct
b.. In correct
c.. Not 5 years and 62 years but 3 years and 65
years respectively
d.. Not 5 years but 7 years whereas 62 years of
age is correct .
173..As per the observation of the High Court, the

DRT has power to entertain the application for
execution of the decree of foreign court.
.. Every application to be filed before the DRT shall
be accompanied by appropriate fees.
.. The Tribunal may , on giving opportunity to both
the sides of being heard, pass interim or final
order for payment of amount including interest
thereon.
174. .A Civil suit which is pending stands

transferred to the DRT. Then the fees
payable
a.. Will be decided by the DRT
b.. Standard fees to be paid as applicable to
a new case referred to the DRT
c.. No fees required to be paid
175..The DRT mechanism is not applicable

to dues of
a.. Nationalized Banks
b.. Co-operative Banks
c.. Regional Rural Bank
d.. State Bank of India
176.. One of the employees of a bank has

committed fraud resulting in a recovery of
around Rs.13.70 lacs. Then the amount
recoverable from him is a debt within the
meaning of DRT Act.
a.. True
b.. False
c.. Not treated as a debt
d.. Considered as a debt only
177..In the ordinary course of business a bank has

permitted overdrawing in the current account of the party
without a regular over draft limit. The amount
outstanding being more than Rs.12 lacs.
a.. It is a debt recoverable under the DRT Act
b.. It is not a debt recoverable under the DRT Act
c.. The question of debt under the DRT Act does not arise
because there has not been any limit sanctioned as
overdraft facility specifically
d.. It is considered as debt since money is taken by the
party
178..The debt recoverable through DRT

has to be
a.. Secured
b.. Clean finance
c.. Unsecured
179.. At the time of sanction of the facility and

obtaining the finance, the amount was Rs.7.50
lacs. Over the period there has been
accumulation and present liability is Rs.11.29
lacs.
a.. Matter can be taken up with DRT.
b.. Matter has to be taken up with Civil Court
c.. Matter can be taken up with DRT after getting
proper permission form the Civil Court
d.. None
180..The Recovery Officer under DRT has

to report to
a.. The Manager
b.. The Superior Officer
c.. The Presiding Officer
d.. None
181.. Presiding Officer of DRT
is
a.. Appointed by the Committee of Bankers

b.. Appointed by the RBI
c.. Appointed by the RBI in consultation with Central
Government
d.. None of the above.
182.. Debt Recovery Tribunal is made up of

more than one Presiding Officer.
a.. True
b.. False
c.. Not more than one
d.. Depending upon the size more no of
Presiding Officers would be decided by
the Government
183.. Which one is correct (DRT)

a.. A person is qualified for appointment as presiding officer
of a tribunal if he is, or has been, or is qualified to be
appointed as a District Judge.
b.. A person is qualified for appointment as presiding officer
appointed as a High Court Judge.
c.. A person is qualified for appointment as presiding officer
appointed as a Metropolitan Judge.
d.. None of these
184.. Under DRT, an Appellate Tribunal has

to be headed by
a.. Only One person
b.. Presiding Officer
c.. Chairperson
d.. Both a & c
185..The Tribunal (DRT) may pass on interim

order against the defendant to debar him from
transferring or dealing with the property in any
manner without the permission of the Tribunal.
Such an order may be by way of
a.. Injunction
b.. Stay
c.. Attachment
186.. Appeal before the Appellate Tribunal to

be disposed off finally from the date of
receipt of appeal within
a.. 3 months
b.. 6 months
c.. 180 days
d.. None of these
187..There is no provision in the DRT Act for

further appeal against the order passed by the
Appellate Tribunal.
a.. True
b.. Writ Jurisdiction of High Court and Supervisory
jurisdiction of High court not barred
c.. Special Leave Petition before the Supreme
Court not barred
d.. All the above are correct
188.. The Correction any clerical or

arithmetical mistake in Recovery
Certificate has to be done by (Certificate
issued by the Presiding Officer)
a.. Concerned Clerk himself
b.. The Presiding Officer of the Tribunal
c.. The Recovery Officer
d.. Any one of them
189..Bank A has received a notice from a Recovery Officer

(DRT) directing the bank to remit a sum of Rs.25000/lying with them in the account of their depositor R who
happens to be the debtor for another bank S. The notice
directed A to remit the money to the Recover Officer.
a.. Bank A has to oblige
b.. Bank A need not oblige
c.. Since it is not a Garnishee order by a competent Court
Bank A need not oblige
d.. Bank A to ignore otherwise R can take objection
190..The Recovery officer
while carrying out his job, a

third party is affected. Then he can file an appeal
a.. Within 30 days

b.. To the Tribunal
c.. Both A& B are correct
d.. Both A & B are wrong
191..Who is not the public servant as per the Sect 21 of

the Indian Penal Code.
a.. The Chairperson of an Appellate

Tribunal
b.. A Director of a Public Limited Company
c.. The Recovery Officer
d.. The Presiding Officer of a tribunal
192.. The DRT issues Recovery Certificate to the applicant.

Recovery Officer has to proceed to recover the amount
specified in the Recovery Certificate, by adopting
a.. Attachment and sale of movable and immovable
property of the defendants
b. Arrest of the defendant and his detention in prison
c.. Appointment of a receiver for the management of the
movable and immovable properties of the defendant.
d.. Any one of the above.
193..Any person aggrieved by the order passed by the

Tribunal or deemed to have been passed by the Tribunal
under DRT Act, may prefer an appeal to the concerned
Appellate Tribunal.
a.. Within 45 days form the date on which copy of the order
is received.
b.. Within 45 days from the date of the order
c.. Within 30 days from the date of the order
d.. Within 60 days from the date on which copy of the order
is received.
194.. Bank SK has moved the DRT for justice.

Before the final order is passed Bank BY, who
had also advanced to the same borrower has
approached the DRT for inclusion in the same
proceedings.
a.. Permissible
b.. Not permissible
c.. Not permissible since both the contracts are
different
d.. DRT would not entertain and advise the bank to
file a separate case.
195..Identify which one is incorrect (DRT matters)

a.. Recovery officer can ask the defendant to
furnish by affidavit particulars of his assets.
b.. The defendant can raise a plea before the
Recovery Officer about correctness of the
amount ordered to be paid.
c.. A counterclaim filed before DRT has the same
effect as a plaint in cross-suit.
d.. For the matters for which the Tribunals are
empowered the Civil Courts have no jurisdiction.
196..Under the Bankers Book Evidence Act,

the term Judge refers to
a.. Judge of a special Court
b.. Judge of a High Court
c.. Judge of a DRT
d.. Judge of Civil Court
197..The Bankers Book Evidence Act

extends to whole of India except the Sate
of Jammu & Kashmir,.
..Bankers books include ledgers, daybooks,
cashbooks, account books and all other
records used in the ordinary course of
business of a bank.
198..A certified copy of any entry in a Bankers

Book is received in legal proceedings as
conclusive evidence for existence of such entry.
a.. Correct
b.. In correct
c.. It is not Conclusive but prima facie evidence
d.. Support
199.. For making the order that bank officer should either
produce the books of account or appear as witness (as
per the Bankers Book Evidence act) can be made by the
Court or Judge with out summoning the bank. Such
order shall be served on the bank at least 5 days before
the same is to be obeyed.
a.. True
b.. False
c.. Not 5 days but 3 days
d.. At least 3 clear working days
200..If after taking out the copy from the books of the bank,
the original books are destroyed in usual course of the
banks business a further certificate to that effect of
having destroyed the book is not necessary.
a.. True
b.. False
c.. The records associated with court matters should never
be destroyed
d.. The records before destroying should ( in such cases)
have the permission of the competent court
201..For Compromise or settlement of

disputes between parties this system
organized under the Legal Services
Authorities Act,1987 known as
a.. Lok Adalats
b.. Ombudsman
c.. Arbitration
d.. None of these
202.. Identify the incorrect one (Lok Adalats)

a.. The monetary ceiling of amounts regarding
which civil disputes can be settled under this
mechanism is Rs.20 lacs
b.. The monetary ceiling of amounts regarding
which civil disputes can be settled under this
mechanism is upto Rs10 lacs only
c.. Lok Adalats are not organized under the Lok
Adalats Act
d.. There can be an appeal against the award of
the Lok Adalat
203...Consumer Protection Council( identify the incorrect

one)
a.. The Collector of the District to be the Chairman of the
District Council
b.. State Consumer Protection Council to meet at least 3
meetings every year.
c.. For Central Consumer Protection Council the Chairman
will be the Minister in charge of the consumer affairs in
the Central Government.
d.. The highest council is the Central Council who has the
jurisdiction for the entire country.
204..The Consumer Protection Act,1986

applies to
a.. All goods and services
b.. Goods for resale
c.. Goods for commercial purposes
d.. Both b & c are excluded
205..For filing any complaint before a

District Forum, State Commission or the
National Commission the limitation period
is from the date of cause of action.
a..
b..
c..
d..
1 year
2 years
3 years
None of the above
206.. If the compensation claimed is

above Rs.20 lacs but does not exceed
Rs1 Crore then the appeals against the
orders of any District Forum to be
a..
The
High
Court
preferred before
b.. The State Commission

c.. The Central Council
d.. The National Council
207..The Consumer Protection Act is not applicable in
the State of Jammu and Kashmir.

..The Act is for better protection of the interests of the
consumers and for that purpose to make provision for
the establishment of consumer councils and other
authorities for the settlement of consumers dispute.
..The Act is social welfare benefit oriented legislation for
the consumer providing self-contained quasi-judicial
machinery to provide speedy and simple redressal to
consumer disputes.
208..A dispute where the person against whom complaint

has been made, denies or disputes the allegations
contained in the complaint.
a.. Complaint
b.. Consumer Dispute
c.. Dispute
d.. Allegation
209....District Consumer Protection Council to
meet as an when necessary. There has to be at

least two meetings every year.
a.. Correct
b.. Incorrect
c.. At least One meeting
d.. At least Three meetings
210..Service of Notice under the Consumer

Protection Act could be by way of (identify
the incorrect one)
a.. Registered post with acknowledgement
due
b.. Speed post
c.. Local courier
d.. Fax
211..It refers to such goods and services

which are claimed to be genuine but they
are actually not so.
a.. Defective goods
b.. Inefficient services
c.. Bogus goods and services
d.. None
212..Identify the odd one (Consumer

Protection Act, 1986) Person
a.. An unregistered firm
b.. A co-operative Society
c.. Both a & b
d.. None
213..A price stated to be a bargain price by

reference to an ordinary price or a price at
which the product is ordinarily sold or
otherwise. (Consumer Protection
Act,1986)
a.. Agreed Price
b.. Arrived Price
c.. Final Price
d.. None
214..Under the Consumer Protection Act,1986, he

is the person, in relation to any goods means a
person who sells or distributes any goods for
sale and includes the manufacturer thereof, and
whereas such goods are sold or distributed in
package form, includes the packer thereof.
a.. Packer
b.. Trader
c.. Seller
d.. Final Distributor
215..In one of the cases relating to consumer

dispute, the addressee has refused to take
delivery of the notice (not the approved method
of serving) and in such cases the responsibility
lies with whom to confirm that the notice had
been duly served to the concerned addressee
a.. District Forum
b.. State Commission
c.. National Commission
d.. Any one of them (as the case may be)
216.. Which one is correct (Consumer Protection Act. 1986)

a.. All notices required to be served on the opposite party
are deemed to be sufficiently served if addressed to the
place where business or profession is carried on by him
b.. All notices required to be served on the opposite party
place, where he permanently resides
c.. All notices required to be served on the opposite party
place where he is presently living
d.. All notices required to be served on the opposite party
place which is furnished in the records as his address
217..For the trial of offences under the

Consumer Protection Act,1986, the District
Forum, State Commission or National
Commission as the case may be deemed
as and is conferred with the powers of
a.. High Court Judge
b.. First Class Judicial Magistrate
c.. Supreme Court Judge
d.. Metropolitan Magistrate
218..In the interest of Justice the National

Commission may transfer, on the
application of the complainant or on its
own motion, any proceeding at any stage
from one District Forum of one State to a
District Forum of another State and from
one State Commission to another State
Commission. (Consumer Protection Act)
219..National Commissions chief is known as the

President. (Consumer Protection Act)
a.. He is appointed by the Central Government
after clearance from the Parliament
b.. He is appointed by the Central Government
who need not consult any one
c.. He is appointed by the Central Government in
consultation with the Chief Justice of India
d.. He is appointed by the President of India
220.. A person who is or has been Judge of a High

Court, who shall be the President of the State
Commission. (Consumer Protection Act)
a.. His appointment need not be made in
consultation with the Chief Justice of the
Supreme Court
b.. His appointment need to be made in
consultation with the Chief Justice of the High
Court
c.. Both a and b
d.. None
221..Which one is correct (Consumer Protection Act)

a.. Any aggrieved person by the order passed by the District
Forum cannot prefer an appeal to the State Commission
within a period of 30 days from the date of the order
b.. The State Commission do not have the powers to
condone the delay in preferring an appeal.
c.. Every member of the State Commission shall hold office
for a term of 5 years or up to the age of 65 years,
whichever is earlier.
d.. Every appointment as a member of the State
Commission has to be mad by the State Government on
the recommendations of the Chief Justice of the High
Court
222..Consumer Protection Act (For appointment as a

member of the State Commission has to be done by the
State Government on the recommendations of the
Selection Committee)
a.. The President of the State Commission, who shall be
the Chairman of Selection Committee
b.. Secretary, Law Department of the State, who shall be
the member of the Selection Committee
c.. Secretary-in-Charge of the department dealing with
Consumer Affairs in the State, who shall be the member
of the Selection Committee
d.. All the above mentioned persons
223..Every proceedings before the District

Forum shall be deemed to be a judicial
proceeding within the meaning of
appropriate provisions of the Indian Penal
Code and the District Forum shall be
deemed to be a Civil Court for the
appropriate provisions of the code of
Criminal Procedure
224..In a proceedings (District Forum) the

President and one member differ on one point
a.. The point of difference to be ignored
b.. The view point of the President will prevail
c.. The point of difference to be taken into
consideration for proper discussion followed by
appropriate decision
d.. None
225..A Bench (National Commission) may

be constituted by
a.. Supreme Court
b.. President of the National Commission
c.. High Court
d.. Committee of High Courts Judges
headed by the Judge of the Supreme
Court
226.. An interim order has been passed by the

State Commission for attachment. If within a
certain period of attachment of property, the
person does not comply with the order, the
attached property is sold. Identify the period
specified.
a.. 30 days of the order
b.. 3 months
c.. No such specific period but at the discretion of
the respective forum / Commissions
d.. None of these
227.. Debtor R has executed a Demand Promissory Note

and a Hypothecation agreement to Bank BOM. Then the
bank has made available the finance.
a.. Valid contract
b.. Invalid contract
c.. Quasi contract
d.. No contract
228.. J the Debtor had executed a demand promissory

note on 16.03.2006. Identify the correct limitation date.
a.. 16.03.09
b.. 15.03.09
c.. 17.03.09
229 .. V & S have taken a loan from bank T, by

executing a demand promissory note and
other documents jointly.
a.. S is not the promisor
b.. V is the promisor
c.. S & V are promisors
d.. T,S &V are promisors
230.. D had executed an acknowledgment of debt on

22.02.08 for the Demand Promissory Note executed on
20.12.05 and handed them over to the Creditor W on
the respective dates. Find out the exact limitation date
available to W to proceed legally.
a.. 22.02.11
b.. 20.12.08
c.. 19.12.08
d.. 21.02.11
231..Period of limitation is always in relation to a

document which entitles the beneficiary to take
action in a court of law. Period of limitation
means the period of limitation prescribed for any
suit, appeal or application by the Schedule,
prescribed period means the period of limitation
computed in accordance with the provisions of
this Act (Limitation Act,1963)
Suit does not include an appeal or an application
232.. Identify the limitation period not three

years in respect of
a.. A Demand Promissory Note
b.. An Hypothecation Agreement
c.. A Mortgage Deed
d.. An Acknowledgement of Liability
233.. B the borrower of bank C had executed a DPNote on

22.04.05. When the bank wanted to obtain an
acknowledgement of debt they came to know he has
gone out of the country since 27.05.07 and returned
only on 12.10.08.
a.. Bank C had lost the opportunity to sue B filing a suit
b.. Bank C has not yet lost the legal right to file a suit
c.. Bank C should have taken recourse on or before
27.05.07
d.. Since the debt is time barred, Bank C has lost its legal
right to recover
234.. While calculating the limitation period there

has been an error resulting in approaching the
court on the next day of the reopening day of the
court after court holidays.
a.. Plaintiff may not succeed
b.. A suit may be admitted
c.. The suit should have been filed on the
reopening day
d.. There is no such odd and fast rule
235.. Bank G has issued a Bank guarantee. The

due date (expiry date) being 31.10.08. In case of
dispute identify the limitation date. Guarantee
not invoked by the beneficiary.
a.. 3 years from the due date
b..12 years from the due date
c.. No limitation date since guarantee not invoked
d.. Usually the limitation period in these cases
should be from the date of claim only
236.. Bank SX has obtained loan documents from

the borrower/s (including the surety) on
13.03.06. Borrower D and Guarantor J.
D has executed a DP Note and J a guarantee
agreement on the said date. Then the limitation
period
a.. 3 years against both of them
b.. 3 years against only D
c.. 3 years against only J
d.. None
237.. The guarantor U refused to pay when

asked to pay by the creditor H. The main
borrower being C.
a.. H can still proceed against U
b.. H has to forego his legal right against U
c.. H cannot proceed against both C & U
d.. None
238..Bank D has not been successful in getting the

limitation period on a DP Note executed by L.
The three years period expired on two days ago.
D
a.. Has to forego the legal right
b.. May depend upon the repayment (if made) by L
or his authorized agent subject to certain
conditions
c.. May not succeed
d.. May fail and L will receive the benefit
239.. There has been a part payment made in the

borrowers account when the document was having life.
Relying on that the Bank wanted to proceed legally. On
verification it has been found that the voucher
accompanied the payment has not been signed by any
one and the amount is only Rs.100/- Under the
circumstances
a.. Still the bank can proceed
b.. Bank cannot proceed
c.. What is required is part payment and hence Bank would
succeed
d.. Bank has the discretion to proceed on the basis of the
above payment
240.. A time barred debt can be revived as

per the provisions of the
a.. Limitation Act
b.. Negotiable Instruments Act
c.. Banking Regulation Act
d.. None
241.. A person has taken an installment loan . The loan has

to be repaid on yearly basis for 10 years. The documents
executed on 01.01.2002. The first installment started wef
01.01.2004 on wards. The borrower has paid till
01.01.07. Bank has not obtained any Acknowledgement
of debt so far.
a.. Bank has to forego the outstanding amount
b.. Bank cannot file a suit
c.. Since the debt is time barred bank will loose its legal
rights
d.. None
242..Identify the assessment year as per the

IT Act for the financial year ending 31 st
March 2008.
a.. 2007-08
b.. 2008-09
c.. 2009-10
d.. None
243..The income accruing or arising, to a person is

taxed on the basis of Assessment Year. The
term Assessment Year represents the period of
12 months beginning from 1st April every year.
Identify the person mentioned
a.. An assessor
b.. An assessee
c.. A tax payer
d.. An employee
244..C is the NRI customer of Bank Q. He has

earned income in his NRO account. Then his
banker is obliged to deduct tax at source and
remit to the concerned ITO
a.. True
b.. NRI customer is not taxed
c.. In view of (b) the bank need not deduct TDS
d.. In addition to (a) unless otherwise the NRI
produces a proper order from concerned ITO
exempting, the banker has to deduct TDS and
remit which is statutory.
245.. Which statement is correct (Income Tax)

a.. NRE deposit interest attracts Income Tax
b.. FCNR interest is taxable
c.. NRI and persons who are not ordinarily resident
in India, any income derived abroad is not
taxable and only income accruing or arising in
India is liable to tax in India
c.. NRO interest earned beyond the purview of IT.
246..Banking Cash Transaction Tax which

was introduced wef 01.06.05
a.. Still in vogue
b.. Since withdrawn
c.. Since modified
d.. Being continued in selected areas
247.. Identify the odd one (Service tax for

Banking Transactions)
a.. Lockers
b.. Interest income of the bank
c.. Advisory services
d.. Demand Draft issuing
248.. Service Tax is not applicable for import

of goods.
a.. Appropriate
b.. Not appropriate
c.. The correct position is it is applicable for
import of services
d.. It is applicable to export of services and
not for import
249.. Advance tax need to be paid in a

single stroke.
a.. True
b.. False
c.. It has to be paid in 4 installments
d.. There is no concept called Advance Tax
250..A person deducting TDS has to file a

return of TDS
a.. Monthly
b.. Bi monthly
c.. Half yearly
d.. None
251.. A is earning an annul income of less than Rs.1.00

lac. He has deposits (Term) which gives him an annual
interest of Rs.27500. A has informed the Bank not to
deduct tax.
a.. His bank has to carry out his request
b.. Unless he gives an appropriate form, the bank will have
to deduct TDS
c.. As a part of Customer Service the bank has to support
the customer
d.. Bank is not obliged to deduct TDS since the total
income inclusive of interest not coming under tax bracket
252..Banks generally help their customers in

filing their individual IT returns
a.. True
b.. Not True
c.. Banks do not undertake this type of
services
d.. Unless specifically authorized the Banks
do not undertake such services
253..Identify which is not a valid contract.

a.. Proposal and acceptance
b.. Consideration
c.. Free consent
d.. Agreement without consent
254.. D has bailed his goods with R. Who is

responsible in case there is a loss to the
goods bailed.
a.. R
b.. R. Provided he has not taking adequate
care
c.. Not R but D
d.. D
255..Under Pledge, the

possession is with the
a.. Borrower
b.. Creditor
c.. Owner
d.. Debtor
256..Consideration not
required for
a.. An agency
b.. Safe Custody Article
c.. Mortgage
d.. Safe Deposit locker
257.. B has sold goods to A on credit basis.

The sold goods are under the possession
of A. Who has the right of re sale
a.. Obviously A
b.. Only B
c.. None of them
d.. With the permission of A, B has the right
258.. Contract could be

a.. Valid
b.. Invalid or Void
c.. Voidable
d.. Any one
259..A father of a minor has availed a loan on the

security of Minors term deposit
While obtaining the loan documents the banker
has overlooked to record the purpose of the loan
even though such a paper has been obtained.
a.. Banks interest will not be protected
b.. Set of documents will support the banker
c.. Banks interest need not depend on that
particular issue
d.. At least in future the banker has to be careful
260.. A loan has been taken by O. There is no

security. O dies during the loan is pending. Bank
B who has given the loan cannot get back the
dues.
a.. Since O died the contract has come to an end
b.. Bank B may get back the dues by taking
appropriate steps
c.. Bank B should have properly secured their
finance
d.. Banks negligent will cost them
261.. E has approached bank S for a finance on

the strength of the Life Policy. The bank has
considered the request and loan granted after
competing the formalities. In case E survives on
the maturity date of the policy, who will get the
money from Life Insurance Company.
a.. E
b.. Assignee of E
c.. Nominee of E
d.. Assignor
262.The right of subrogation is available for

a.. Guarantor
b.. The Insurance Company
c.. Both a & b
d.. Only the Surety
263.. A person takes an insurance policy on his

life. After receipt of the policy documents ( within
3 days from the date of taking the policy)
unfortunately he dies. The insurance company is
a.. Not obliged to settle the claim
b.. Obliged to settle the claim
c.. Having the right to probe into the matter before
taking decision
d.. Not required to settle the claim since the policy
has not completed the minimum period of 3
years
264.. To receive rents and profits

arising from the property
a.. Simple Mortgage
b.. Usufructuary Mortgage
c.. English Mortgage
d.. Mortgage By way of Conditional Sale
265..Bank X has lent money to R on the personal guarantee of Y. X

took a demand promissory note from R and a guarantee agreement
from both Y & R. Among other contents, the guarantee agreement
protected the bank with special clauses for which Guarantor Y has
given his consent. When R failed to repay, X asked Y to repay the
loan. He promptly refused and advised the bank to approach R who
only has taken the money. After trying and exhausting all the
remedies against R, then only X can approach him and not before
that, that is what Y told the bank.
a.. The stand of Y is not incorrect
b.. The stand of X is appropriate
c.. What Y revealed has substance which would protect him
d.. X would still succeed if they proceed against Y even without
proceeding against R based on the guarantee agreement contents
266..Where there are co-sureties, a release by the

creditor of one of them does not discharge the
others. Also, the surety released does not become
free from his responsibility to the other sureties.
..A surety has the right of Subrogation.
..Any guarantee obtained by means of
misrepresentation made by the creditor is invalid.
..Any guarantee which the creditor has obtained by
means of keeping silence as to material circumstance is
also
invalid.
267..JN, a Director of the Private Limited company had given his

personal guarantee for the credit facilities extended to the company.
After some months he left the company (resigned ) and joined some
other organization. While leaving the company, he has intimated in
writing to the bank that he is resigning from the company. Later on
the Bank decided to proceed against the company for recovery.
They have decided to implead JN as well
a.. Bank will be in order in doing so
b.. Since JN is no more part of the debtor, Bank cannot implead him
c.. Since Bank is the creditor and JN has not been replaced by any
other guarantor bank can do so
d.. Bank will not succeed in proceeding against JN. Instead they should
concentrate on the company and other existing directors
268..Z has appointed U as his agent In turn

U has appointed L (another person) to
look after the affairs of Z for whom U has
been appointed. Then L is
a.. Not a Principal
b.. Sub Agent
c.. Substituted Agent
d.. Manager
269.. No consideration is necessary to create an

agency.
.. In an emergency, an agent has authority to do
all acts to protect his principal form loss as
would be done by a person in his own case.
.. An agent can detain money received by him on
account of goods sold, even if all the goods
consigned to him for sale are not sold.
270.. A bank as a collecting banker has

misplaced the cheque accepted for collection.
The customer when he approached to know
about the realization of the cheque, then only
the bank could realize it has misplaced the
Cheque.
a.. The bank is responsible
b.. Till the cheque is realized or returned, the bank is not responsible.
c.. If the cheque had been purchased then the bank would have been
responsible and not for collection item.
d.. The bank is not responsible
271.. Bank D has been entrusted the assignment

of getting the payment from an upcountry bank
branch. D has sent the cheque in question. After
that at the request of the Payee E, D has
purchased the cheque already sent. Identify the
role of D.
a.. Agent for E
b.. Principal for E
c.. Collecting Banker
d.. None
272.. The agent has been authorized by the

Principal to spend a sum up to Rs.7000/- in the
ordinary course of business. The agent spent
Rs.7200/a.. Agent is well within the powers conferred
b.. Agent has to seek approval
c.. Agent has to seek ratification
d.. Agent can show the expenditure as Rs.6900 /and Rs.300 to avoid complications
273.. D is having a Savings Bank account.

He wish to appoint another person V to
operate the account in his absence. Then
D can give
a.. Power of Attorney in favor of V
b.. A Letter of Authority in favor of V
c.. Either one
d.. None
274..Whether a stipulation in a contract of sale is

condition or warranty depends on the types of
contract. Even if the parties have agreed that a
stipulation is a warranty, in fact, it may be a
condition if it is the basis of the contract.
.. If the sale of goods is by description, there is an
implied condition that the goods shall
correspond with the description.
275.. A B C & co a partnership firm has a current account

with bank Y. The account is operated by any one of the
partners. A cheque (open cheque) received signed by
one of the partners B, representing the firm and in favour
of B. Another cheque signed by C representing the firm
favouring Self.
a.. The bank is in order in paying both the cheques
b.. The bank is not in order in paying both the cheques
c.. The bank is in order in paying the cheque signed by B
and not by C
d.. The bank is in order in paying the cheque signed by C
and not by B
276..Bank E has got the documents executed by a Limited

Company. However they have overlooked to get the
Common Seal affixed on these documents. A
reference to the Articles of Association has revealed
that affixing the Common Seal for the documents has
not been mentioned. In other words, the Articles of
Association is silent with regard to the same.
a. Bank will get protection
b. Bank cannot recover the dues based on the
documents so executed without common seal
c. Affixing of Common Seal is compulsory in such cases.
d. Affixing of Common Seal is not compulsory unless it is
specifically stated in the Articles of Association
277..When a company exercise its powers to

promote and/or realize any of its objects stated
in the Memorandum of Association, it is known
as Intra vires ( i.e., within the powers of ) the
company.
.. Any other act of the company which is outside
the scope of the objects clause of the
Memorandum of Association is called Ultra
vires(i.e., beyond the powers of ) the company
278.. Doctrine of Constructive notice states

that every outsider is assumed to have
read the Memorandum of Association and
Articles of Association.
.. Doctrine of Indoor Management lays down
that the outsiders are not required to see
the compliance of internal regulations of
the company.
279..A company has been formed for

promotion of science. They would like to
have the name without Private Limited.
Then the permission is to be given by
a.. Company Law Board
b.. Registrar of Charges
c.. Registrar of Companies
d.. None
280..Capital Clause in the Memorandum of

Association to discuss about the
a.. Authorized Capital
b.. Issued Capital
c.. Subscribed Capital
d.. Paid up Capital
281.. The memorandum of association is a

dominant instrument as is states the purposes of
the company and the reasons for which it has
come into existence.
.. The articles of association are always held to be
subordinate to the memorandum of association
because the articles of association are merely
the internal regulations of the company while the
memorandum of association states the objects
of the company beyond which the company
cannot go.
282.. A Private Limited Company wish to change

its Registered Office to another State. Then
a.. They can do so and intimate Registrar of
Companies of both the States
b.. They have to pass a Special resolution and with
the sanction of Company Law Board they can
proceed further
c.. The post facto approval from the Central
Government (Law Ministry ) essential
d.. Matter to be referred to Company Affairs
Authority for guidance
283..Bank H has not fully gone through the contents of the

Object Clause of the Memorandum of Association (MA)
They lent to the company for a particular purpose. After
the loan has been availed by the company, it came to the
knowledge of the bank, that the company is not dealing
with the goods (as per the MA ) for which finance has
been given.
a.. Bank need not worry
b.. Company, if they do not pay, can be insisted legally
c.. Bank can still get the money, since they have taken
necessary loan documents
d.. Bank need to worry
284..A person is deemed to become a member of

a company if he allows his name to be put on
the register of the members or otherwise holds
himself out as a member even if there is no
agreement to become a member.
a.. Membership by Acquiescence
b.. Membership by Association
c.. Special Member
d.. Share Transmission
285.. Shares had been issued in the name

of F. He has recently died. F had not
nominated any person. Then his wife J
(only legal representative) wish to become
the share holder.
a.. Transfer of Shares
b.. Transmission of Shares
c.. Acquiescence of Shares
d.. Allotment of Shares
286.. Although a company is a separate legal entity distinct

from shareholders in reality, it is an association of
persons who are the beneficial owners of all the
corporate property. Hence it may sometime become
necessary to look at the persons who are behind the
Corporate Veil. The Corporate Veil is said to be lifted or
pierced when the Court ignores the separate entity of the
company and directly concerns itself with the members
or directors of the company. There is no specific law as
to when this should be done. Court decides this as
application on case to case basis.
287..Who cannot be a member of a

company
a.. Partner
b.. Company
c.. NRI
d.. None
288..Which one is not a statutory right

a.. Transfer of Shares
b.. To receive dividends
c.. Receive Copy of Balance Sheet
d. To file a petition to the High Court to order
winding up of the company
289.. To participate in the distribution of

assets in case of liquidation of the
company is called
a.. Statutory Right
b.. Proprietary Right
c.. Ordinary Right
d.. Documentary Right
290.. Statement by Expert has to be part of

a.. Articles of Association
b.. Resolution
c.. Memorandum of Association
d.. None
291.. A Prospectus can be issued

a.. Before formation of the company
b.. Only after the Incorporation of the
Company
c.. At the discretion of the Registrar of
Companies
d.. At the will of the concerned Company
292..The provisions of FEMA(1999) extend

to all over India and also apply to all
branches, offices and agencies outside
India owned or controlled by a person
resident in India and also to any
contravention committed outside India by
any such person to whom this Act applies.
293..Currency under FEMA means and

includes
a.. Postal Notes
b.. Postal and Money orders
c.. Letter of Credit
d.. All
294.. Identify which one is not a Current Account

Transaction
a.. Payments due as interest on loans and as
income from investments
b.. Remittances for living expenses of parents,
spouse and children residing abroad
c.. Remittances into NRI account holder in India
d.. Expenses in connection with foreign travel for
medical treatment of a resident
295.. Capital account transactions means

transactions by which there may be a
change (either an increase or decrease) in
the assets or liabilities outside India or
persons resident in India or assets or
liabilities in India of persons resident
outside India
296.. A contract of sale of goods is a

contract under which the seller transfers or
agrees to transfer the property in goods to
the buyer for a price. When the property in
the goods is transferred from the seller
to the buyer, the contract is called a sale.
297..Goods means every kind of moveable

property (other than actionable claims &
money).
* Stock and shares, growing crops , grass
and things attached to or forming part of
land which are agreed to be severed
before sale or under the contract of sale.
298..When the transfer of the property in the

goods to take place at a future time or subject to
some condition thereafter to be fulfilled, the
contract is called an agreement to sell.
Under sale the risk in goods is with the buyer.
Under sale both parties have already performed
their part.
Under sale the ownership stands transferred
whether the goods are delivered or not
299..Under sale the seller does not deliver

the goods the buyer can file a suit and
demand specific performance and delivery
of the goods.
* In case the buyer fails to pay, the seller
has the right to file a suit and demand the
price
300..Under an agreement to sell both the parties

are yet to perform.
The ownership remains with the seller
The risk in goods still with the seller, only after
the sale is effected it will pass on to the buyer
If seller fails to deliver the goods/property then,
the buyer can only claim damages in a suit
Here the seller may not part with the goods till
payment is made by the proposed buyer.
301..Express conditions and warranties are

those which are expressly stated in the
contract. Implied conditions and warranties
are those which the law implies into every
contract of sale of goods.
*** In a sale of goods by description, there is
an implied condition that the goods shall
correspond with the description
302..If the sale is by sample there is an

implied condition that the bulk shall
correspond with the sample in quality.
Further, the buyer will have an opportunity
to compare the bulk with the sample.
Goods should be free from any defects
303.. Caveat means a warning or caution. It

is the responsibility of the buyer to check
or examine before purchasing. The
Caveat emptor means Buyers Beware.
After selecting by his own judgment later
on the purchaser cannot complain or put
the blame on the seller. While purchasing
the buyer has to be careful to avoid
complications later on.
304..Unpaid sellers rights against the Buyer

personally arise out of breach of contract
and the seller can file a suit to claim
damages, claim the price of goods with
interest and he can also repudiate the
contract.
305.. A partner is the agent of the firm for the

purpose of the business of the firm.
A partner can make the firm liable by his acts, if
done in the name of the firm and in the ordinary
course of business of the firm.
An act done by a partner to carry on the kind of
business done by the firm ( in the usual way)
binds the firm. This authority of a partner to bind
the firm is called his implied authority.
306.. J has been admitted to receive the benefits of the firm

when he was a minor. Subsequently J became a major.
He has not given any public notice to the effect whether
he wanted to become a partner or not.
a.. J will not become a partner
b.. J will become a partner automatically on completion of
six months from the date on which he has become the
major
c.. Since J did not give any public notice he will not be
allowed to become a partner
d.. It is left to J to become a partner or not and there is no
specific notice required
307.. Among other clauses in the Partnership deed, it has

been clearly mentioned that the bank account can
continue even after the death of any one of the partners.
The firm has 4 partners. One of them died recently. Then
the bank
a.. Has to close the account
b.. Can allow the existing partners to use the existing
account
c.. Usually closes the account to avoid complications
d.. Can rely on the Partnership Act provisions
308..The Right to Information Act is applicable

through out India except the State of Jammu
and Kashmir.
..As per the Right to Information (Regulation of
Fee and Cost)Rules,2005, the application shall
be accompanied by a fee of Rs.10/.. The Act provides opportunities to call for
information which could provide vital details to
proceed further in case of need.
309..The Central Government can constitute

a body called the Central Information
Commission and the State Government to
set up the State Information Commission.
Appeal could be filed within 30 days from
the expiry of period (normally 30 days)
310..The Prevention of Money Laundering

Act,2002 was enacted to prevent money
laundering. The Act provides rigorous
punishment for the offence of money
laundering .Central Government has in
consultation with RBI has framed certain rules.
They include what records to be maintained,
retention of records, verification of identity of
client and furnishing information in respect of the
transactions to the Director and so on
311..According to the Information Technology

Act,2000 certifying authority means a person
who has been granted a licence to issue a
Digital Signature Certificate.
..Digital Signature means authentication of any
electronic record by a subscriber by means of an
electronic method or procedure
..Key pair is an asymmetric crypto system, means
a private key and its mathematically related
public key, which are so related that the public
key can verify a digital signature created by the
private key.
312.. The key of a key pair used to create a

digital signature.
a.. Private key
b.. Public key
c.. Both
d.. None
313.. The key of a key pair used to verify a

digital signature and listed in the Digital
Signature Certificate
a.. Public key
b.. Private Key
c.. Both
d.. None
314..As per the provisions of the Information

Technology Act 2002, who shall advise the
Government as regards any rules or for any
other purpose connected with the said Act.
a.. Not below the rank of the Deputy
Superintendent of Police
b.. Ministry of Information Technology
c.. Reserve Bank of India in consultation with the
Prime Ministers Office
d.. None
315.. The Information Technology Act

facilitated the amendments to
a.. Indian Penal Code and the Indian
Evidence Act
b.. Bankers Book Evidence Act and
Reserve Bank of India Act
c.. Both a and b
316.. A system of a secure key part

consisting of a private key for creating a
digital signature and a public key to verify
the digital signature.
a.. Access
b.. Asymmetric crypto system
c.. Control system
d.. Function
317..(1)The mortgagor apparently sells the

mortgaged property to the mortgagee (2)
The mortgagor delivers possession of the
mortgaged property to the mortgagee
a.. Simple & Equitable
b...Conditional Sale & Usufructuary
c.. Simple & Usufructuary
d.. English & Conditional Sale
318..Identify the mortgage not popular with

bankers while obtaining immovable
properties as security.
a.. Mortgage by way of Conditional Sale
b.. Usufrctuary Mortgage
c.. Simple Mortgage
d.. Both a & b

JAIIB/Diploma in Banking & Finance Legal & Regulatory Aspects of Banking

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JAIIB/Diploma in Banking &

01.. Identify which one is correct.

02..The award of a Banking Ombudsman

03..Which is not correct (Banking

04..Means an agreement reached by the

05..Which one is appropriate (Banking

06.. A complaint alleging deficiency in

07..No complaint to the Banking Ombudsman shall

08.. The complaint is made not later than

09.. If a complaint is not settled by agreement

10..A person has applied for a loan . The bank has

11.. A bank not agreeing to accept the Award

12..Reserve Bank of India appoint one or

13.. Banking Ombudsman ( identify the odd one)

14..With regard to complaints relating to

15.. A copy of the award need not be sent to the

16.. The banks covered by the Scheme of

17.. A complaint has been filed against a Bank

18.. Ashis Kumar is an Advocate. He is not satisfied with

20.. Limitation period for filing of the review

21..The Banking Ombudsman

22..Thorat is the agent of a bank who has assured that the

23..Banking Ombudsman - A bank wish to

24..A compensation claimed is around Rs.16 lacs in a

25..SARFAESI Act 2002, extends to whole

26.. SARFAESI Act has

27..Based on the observation of the

28..Bank Z had advanced on the collateral security of the

29.. The provisions of the SARFAESI Act will

30.. For a mortgaged property to sell the same

31.. ABF Bank has advanced to a partnership firm. The

32.. Which one is not associated with

33..Which one is not coming under the purview of

34..Identify the odd one (Securitization

35..Appellate Tribunal is constituted by

36..Take over of loans or advances from the

37.. The SARFAESI Act is applicable to

38..Acquisition of any right or interest, of any bank

39.. As per the provisions of the SARFAESI

40.. SARFAESI Act applicable in respect of

41..Default should have been committed by

42.. Bank U has lent to A a sum of Rs.5

43.. He is the owner of a financial asset that

44.. Obligor is a person liable to pay to the

45.. Identify the Obligor in respect of a loan

46.. Under the provisions of the Act

47.. Qualified Institutional Buyer (odd one)

48..Which one is not pertaining to

49.. The securitization company or reconstruction

50.. Bank R is the secured creditor and W is the

51.. Who will receive the Security receipt from

52..Identify the regulatory authority for all

53..GNMV, the secured creditor. After completing

54..In Mardia Chemicals vs Union of India

55.. A reconstruction company

a.. is engaged as property developer

56..The Government of India has

a.. issued an order

57..A Mutual fund, an Asset Management

58..J F D a Securitization and reconstruction

59..The Securitization Company not only to

be registered under the Companies Act but