1.

The Indian Contract Act came into force on:

(a) 15th September, 1872

(b) 1st September, 1872
(c) 1st October, 1872
(d) 15th October, 1872.

2. The Indian Contract Act, applies to the:

(a) Whole of India excluding Jammu & Kashmir

(b) Whole of India including Jammu & Kashmir
(c) States
notified by the Central Government from
time to time
(d) None of the above. Answer:

3. An agreement consists of reciprocal promises

between at least

(a) four parties.

(b) six parties.
(c) three parties.
(d) two parties.

4. Every promise and every set of promise forming

the consideration for each other is a/an

(a) contract.

(b) agreement.

(c) offer.
(d) acceptance.

5. Contract is defined as an agreement enforceable

by law, vide Section … of the Indian
Contract Act.

(a) Section 2(e)

(b) Section 2(f)
(c) Section 2(h)
(d) Section 2(i)

6. Valid contracts

(a) are made by free consent.

(b) are made by competent parties.
(c) have lawful consideration and lawful object.
(d) all of the above.

7. A contract creates

(a) rights and obligations of the parties to it.

(b) obligations of the parties to it.
(c) mutual understanding between the parties to it.
(d) mutual lawful rights and obligations of the parties
to it.

8. In agreements of a purely domestic nature,

the intention of the parties to create legal
relationship is

(a) to be proved to the satisfaction of the court.

(b) presumed to exist.
(c) required to the extent of consideration.
(d) not relevant at all.

9..............is forbidden by law.

(a) Valid contract

(b) Illegal agreement
(c) Voidable contract
(d) Unenforceable contract

10. A makes a contract with B to beat his

business competitor. This is an example of
(a) valid contract.
(b) illegal agreement.
(c) voidable contract.
(d) unenforceable contract.

11. Which of the following legal statement is

incorrect?

(a) An
agreement enforceable by law is a contract
[Section 2]
(b) All agreements are contracts [Section 10]
(c) A
proposal when accepted becomes a promise
[Section 2]
(d) Every promise and every set of promise
forming the consideration for each other is an
agreement [Section 2(e)]
12.............is made by words written.

(a) Express contract

(b) Implied contract
(c) Tacit contract
(d) Unlawful contract

13. Agreement the meaning of which is

uncertain is

(a) Void

(b) Valid

(c) Voidable

(d) Illegal Answer:

14. Which of the following relationship raise

presumption of positive influence?

(a) Parent and Child

(b) Religious/ Spiritual Guru and disciple
(c) Guardian and Ward
(d) All of the above

15. Which of the following is false with respect

to minor entering a contract?

(a) An agreement with or by a minor is void ab initio

(b) A minor can be a beneficiary of a contract
(c) The contracts involving a minor as a beneficiary
may be enforced at the option of the third party
(d) A
minor cannot ratify a contract on attaining
majority

16. Drawing cash from ATM, sale by fall of

hammer at an auction sale, etc., are example of

(a) express contract.

(b) implied contract.
(c) tacit contract.
(d) unlawful contract.

17............is a one-sided contract in which only one

party has to perform his promise
or obligation.

(a) Void contract

(b) Illegal agreement
(c) Unilateral contract
(d) Bilateral contract

18. All Contract is a/an ……………..

(a) Offer

(b) Agreement

(c) Acceptance

(d) Transaction

19................A/an is every Promise and every set

of promises , forming consideration for
each other

(a) Offer

(b) Agreement

(c) Acceptance

(d) Transaction

20. Every agreement and promise enforceable

by law is …………….

(a) Offer

(b) Contract

(c) Acceptance

(d) Consideration

21. “A Contract is an agreement creating and

defining obligations between the parties” the
definition was put forwarded by

(a) Dr. Ambedkar

(b) Pollock

(c) Salmonds

(d) N.D.Kapoor

22. The Law of Contract is nothing but ...............

(a) A Child of Commercial dealing

(b) A Child of Religion
(c) A Child of day to day Politics
(d) A Child of Economics.
23. To form a valid contract, there should be
atleast .............

(a) Two parties

(b) Three parties
(c) Four parties
(d) Five parties.

24. Contractual rights and duties are created by

...............

(a) State
(b) Statute
(c) Parties
(d) Custom or Usage.

25.........................................Agreement is defined by
the section.......................of the Indian Contract
Act, 1872.

(a) Section 2(c)

(b) Section 2(e)
(c) Section 2(g)
(d) Section 2(i)

26. As per section 2(e) of the Indian Contract

Act, “Every Promise and every set of promise
forming the consideration for each other is a/an

(a) Contract
(b) Agreement
(c) Offer
(d) Acceptance

27. A promises to deliver his watch to B and, in

return, B Promise to pay a sum of ` 2,000.
There is said to be a/ an

(a) Agreement
(b) Proposal
(c) Acceptance
(d) Offer

28. An Agreement is ...................

(a) Offer
(b) Offer+ Acceptance
(c) Offer + Acceptance + Consideration
(d) Contract
29. A Contract is ................

(a) A promise to do something or abstain from doing

something.
(b) A communication of intention to do something or
abstain from doing something
(c) A set of promises.
(d) An agreement enforceable by law.

30. Contract
is defined as an agreement enforceable
by Law, vide section....................................of the
Indian Contract Act.

(a) Section 2(e)

(b) Section 2(f)
(c) Section 2(h)
(d) Section 2(i)

31. Which of the following is false? An offer to be

Valid must

(a) Contain a term the non- compliance of which

would amount to acceptance.
(b) Intend to create legal relations.
(c) Have certain and unambiguous terms.
(d) Be communicated to the person to whom it is
made.

32. Over a cup of coffee in a restaurant, X Invites Y

to dinner at his house on a Sunday. Y hires a taxi
and reaches X’s house at the appointed time , but
x fails to perform his promise. Can Y recover any
damages from X?

(a) Yes, as y has suffered

(b) No, as the intention was not to create legal
relation.
(c) Either (a) or (b)
(d) None of these.

33. Which one of the following is the best statement

about the Indian Contract Act?

(a) It is an exhaustive code containing the entire law

of contract.
(b) It is an Act to amend certain parts of the law
relating to contracts
(c) It is an Act to define certain parts of the law
relating to contracts and contains only the
general principles of contract.
(d) It is not an exhaustive code containing the
entire law of contracts being an Act to define and
amend certain parts of law relating to contract.

34. Which of following is a contract?

(a) A engages B for a certain work and promises to

pay such remuneration as shall be fixed. B does
the work.
(b) A and B promise to marry each Other.
(c) A takes a Seat in a public vehicle
(d) A invites B to a card party. B accepts the
invitation.
35. For
binding contract both the parties to the
contract must:

(a) Agree with each other.

(b) Put the offer and counter offers.
(c) Stipulate their individual offer
(d) Agree upon the same thing in the same sense.

36. Which
one of the following has the correct
sequence?

(a) Offer, acceptance, consideration, offer.

(b) Offer, acceptance , consideration, contract
(c) Contract, acceptance, consideration, offer.
(d) Offer, consideration, acceptance, contract.

37. Goodsdisplayed in a Shop window with a price

label will amount to:

(a) Offer
(b) Acceptance of offer
(c) Invitation to offer
(d) Counter offer

38. Whatcan a catalogue of books, listing price of

each book and specifying the place where the
listed books are available be termed as?

(a) An offer
(b) An obligation
(c) An invitation to offer
(d) A promise to make available the books at the
listed place.
39. Which one of the following statement about a
valid acceptance of an offer is incorrect?

(a) Acceptance should be absolute and unqualified.

(b) Acceptance should be in the prescribed manner
(c) Acceptance should be communicated
(d) Acceptance should be made while the offer is
subsisting

40. A Counter offer is ...............

(a) A rejection of the original offer

(b) An acceptance of the offer
(c) A bargain
(d) An invitation to treat

41. The offer must be …………...

(a) Conditional

(b) Temporary

(c) Definite
(d) all of the above

42. A contract is made where:

(a) A buys a book from a shop

(b) X bids at a public auction.
(c) X agrees with Y to discover a treasure by magic
(d) Z agrees to attend the birthday party of his friend

43. Parol contracts are also known as

(a) Simple Contract

(b) Format Contract
(c) Void Contract
(d) Conditional contract

44. Anoffer made by words spoken or written is

called:

(a) Implied offer

(b) Express offer
(c) Formal agreement
(d) Informal agreement

45. A tender is

(a) an offer
(b) invitation to an offer
(c) acceptance of offer
(d) none of the above

46. An offer stands revoked

(a) If
the fact of the death or insanity is known to
offeree
(b) By counter offer
(c) By rejection of offer
(d) All the above
47. For an acceptance to be valid, it must be

(a) Partial & qualified

(b) Absolute & unqualified
(c) Partial & unqualified
(d) Absolute & qualified

48. Acceptance takes place as against the proposer,

when

(a) When
the letter of acceptance is posted by the
acceptor
(b) When
the letter of acceptance is received by the
proposer
(c) Whenthe offeree, writes the letter of acceptance,
but doesn't post it
(d) All the above

49. Communication of offer is complete when

(a) The letter is posted to the offeree

(b) The letter is received by the offeree
(c) The
offer is accepted by the person to whom it is
made
(d) It
comes to the knowledge of the offeror that the
letter has been received by the offeree

50. The
communication of a proposal is complete
when it comes to

(a) The knowledge of that person

(b) The object of the offer
(c) The intention with which offer is made
(d) The facts underlying the offer

51. A person making a proposal is called ..............

(a) Promisor
(b) Vendor
(c) Contractor
(d) Promise

52. Which
one of the following will constitute a valid
acceptance?

(a) An enquiry as to fitness of the subject matter of

contract.
(b) A provisional acceptance
(c) Addition of a superfluous term, while accepting
an offer.
(d) A conditional acceptance.

53. Which one of the following statement is true?

(a) Offer and acceptance are revocable

(b) Offer and acceptance are irrevocable
(c) An offer can be revoked but acceptance cannot
(d) An offer cannot be revoked but acceptance can
be revoked.

54. The
Communication of acceptance through
telephone is regarded as complete when:
(a) Acceptance is spoken on phone.
(b) Acceptance comes to the knowledge of party
proposing.
(c) Acceptance is put in course of transmission.
(d) Acceptance has done whatever is required to be
done by him.

55. Which one of the following falls into the category

of offer?

(a) Newspaper advertisement regarding sale.

(b) Display of goods by a shopkeeper in his window
with prices marked on them
(c) An advertisement for a concert.
(d) Announcement of reward to the public.

56. Asees an article marked “Price Rupees

Twenty” in B’s shop .He offers B 20 for the
article. B refuses to sell saying the article is not
for sale. Advice A.

(a) A cannot force B to sell the article at ` 20

(b) A can force B to sell the article at ` 20
(c) A can claim damages
(d) A can sue B in the Court.

57. Which one of the following statement is

incorrect?

(a) Oralacceptance is a valid acceptance.

(b) Mere silence is not acceptance
(c) Acceptance must be communicated
(d) Acceptance may not be in the prescribed manner

58. Consider the following statement:

(1) There is no difference between the English

Law and Indian Law with regard to
acceptance through post.
(2) Both Under the English Law and the Indian Law
a contract is concluded when the letter of
acceptance is posted.
(3) Under the Indian Law when the Letter of
acceptance is posted it is completed only as
against the proposer.
Which of the above
statement is/are
correct? (a)1 and 2
(b) 2 alone
(c) 3 alone
(d) None
59. In
Commercial and business agreements, the
intention of the parties to create legal
relationship is

(a) Presumed to exist

(b) To be specifically expressed in writing
(c) Not relevant or all
(d) Not applicable.

60. An agreement is a Voidable Contract when it is

(a) Enforceable
(b) Enforceable by Law at the option of the aggrieved
party
(c) Enforceable by both the parties
(d) Not enforceable at all.
61. A Contract creates..............

(a) Rights in personam

(b) Rights in rem
(c) Only rights and no obligations
(d) Only Obligations and no rights.

62. Anagreement not enforceable by Law is said to

be void under section.....................................of
the
Indian Contract Act.

(a) Section 2(a)

(b) Section 2(b)
(c) Section 2(f)
(d) Section 2(g)

63. When the contract is perfectly valid in its

substance but cannot be enforced because of
certain technical defects. This is called a/ an-

(a) Unilateral Contract

(b) Bilateral Contract
(c) Unenforceable Contract
(d) Void Contract
64. Theterm” Proposal or offer” has been defined in -
of the Indian contract Act.

(a) Section 2(a)

(b) Section 2(b)
(c) Section 2(c)
(d) Section 2(d)

65. Theterm” Promise” has been defined in of the

Indian Contract Act.

(a) Section 2(a)

(b) Section 2(b)
(c) Section 2(c)
(d) Section 2(d)

66. The person making the proposal is called .............

(a) Promisor
(b) Promisee
(c) Participator
(d) Principal

67. Offer
implied from conduct of parties or from
circumstances of the case is called ...........

(a) Implied offer

(b) Express offer
(c) General offer
(d) Specific offer

68. An
offer made to a (i) Specific person, or (ii) a
group of persons is known as

(a) Standing offer

(b) Specific offer
(c) Special offer
(d) Separate offer

69. Communicationof proposal is complete when it

comes to the knowledge of ...........

(a) The person to whom it is made

(b) The proposer
(c) Either (a) or (b)
(d) The Court.
70. Terms of an offer must be .........

(a) Ambiguous
(b) Uncertain
(c) Definite
(d) Vague

71. A contingent contract is

(a) Void

(b) Voidable

(c) Valid

(d) Illegal
72. A contract is said to be discharged or terminated

(a) When the rights and obligation are completed

(b) When the contract becomes voidable
(c) Both (a) & (b)
(d) None of the above

73. Which is not the mode of discharge of contract

(a) Performance of contract

(b) Lapse of time
(c) Breach of contract
(d) Injunction

74. Aperson finds certain goods belonging to some

other persons. In such a case, the finder

(a) Becomes the owner of that good

(b) Is under a duty to trace the real owner
(c) Can sell that good if true owner is not found
(d) Both (b) & (c)

75. If in a contract, the time lapses and if the

party fails to perform the contract within
specified time the contract becomes

(a) Voidable

(b) Void

(c) Illegal

(d) Enforceable in the court

76. Change in one or more of the important terms in a
contract, it is the case of

(a) Novation

(b) Rescission

(c) Remission

(d) Alternation

77. In both the cases, devolution of joint

liabilities and devolution of joint rights, if a
promisor dies, who will perform on behalf of
him

(a) Other promisor

(b) His legal representation
(c) Both (a) & (b)
(d) None of the above

78. A contract which is impossible to perform is

(a) Voidable

(b) Void

(c) Illegal

(d) Enforceable
79. Aparty entitled to rescind the contract, loses the
remedy where

(a) He has ratified the contract

(b) Third party has acquired right in good faith
(c) Contract is not separable
(d) All of the above

80. The special damages i.e. the damages

which arises due to some special or unusual
circumstances
(a) Are not recoverable altogether
(b) Are illegal being positive in nature
(c) Cannot be claimed as a matter of right
(d) Can be claimed as a matter of right

81. Which of the following statement is/are correct

(a) Ordinary damages are recoverable

(b) Special
damages are recoverable only if parties
know about them
(c) Remote or indirect damages are not recoverable
(d) All of these

82. Exemplary damages are not awarded in such

case

(a) Breach of promise to marry

(b) Wrongful dishonour & customers cheque by
banker
(c) Breach of any business contract
(d) None of the above

83. Damages which the contracting parties fix at the

time of contract in case of breach
(a) Unliquidated Damages
(b) Liquidated Damages
(c) Nominal Damages
(d) None of the above

84. A
order of court restraining a person from doing a
particular act, it’s a case of

(a) Specific performance

(b) Injuction

(c) Both (a) & (b)

(d) None of the above
85. Under
the Indian Contract Act, the contract of
indemnity is restricted to such cases

(a) Where the loss promise to be reimbursed is

caused by the conduct of the promisor or any
other person
(b) The loss caused by the any events or accident
which does not depend upon conduct of any person
(c) Both (a) & (b)
(d) None

86. Whatis the ratio of parties in contract of

indemnity and contract of guarantee

(a) 2 : 3
(b) 3 : 2
(c) 1 : 3
(d) 2 : 1

87. Incontract of indemnity, what is the liability of

indemnifier against the indemnified

(a) Primary
(b) Secondary

(c) No liability
(d) Both (a) & (b)

88. In case of contract of guarantee, what is the

liability of the surety against the principal debtor

(a) Primary

(b) Secondary

(c) No liability
(d) Fully liable
89. Which is not the case of discharge of surety

(a) By notice of revocation

(b) By death of surety
(c) If creditor releases the principal debtor
(d) None of the above

90. What is the right of the bailee against the goods

(a) Owner

(b) Possessor

(c) Bailee can sell those goods

(d) Both (a) & (b)

In case of Contract of guarantee, if the creditor

91.
loses or parts with any security which the debtor
provides him at time of contract, the surety is
discharged to the extent of

(a) The value of the security

(b) The surety can be fully discharged
(c) The surety can claim damages
(d) All of the above

92. Which one is not the duties of bailee

(a) The bailee must take care of goods as of his

 goods.
(b) The
bailee cannot use bailor’s goods in an
unauthorised manner.
(c) The
bailee should return the goods without
demand on the expiry of the time period.
(d) He can set up adverse title to the goods.

93. A lien which is available only against that

property of which the skill and labour have been
exercised

(a) General Lien

(b) Particular Lien
(c) Ordinary Lien
(d) Both (a) & (b)
94. Which is not the case of termination of bailment

(a) Wherethe bailee wrongfully uses or dispose of

the goods bailed.
(b) When the period of bailment expires
(c) When the object of bailment has been achieved
(d) None of the above

95. An agency may also arise by

(a) Estoppel

(b) Necessity

(c) Ratification

(d) All of the above

96. A mercantile agent employed to sell goods

which have been placed in his possession or
contract to buy goods for his principal

(a) Factors

(b) Brokers
(c) Del Credere Agent
(d) Auctioneers

97. The threat to commit suicide amounts to

(a) Coercion

(b) Undue influence

(c) Misrepresentation

(d) Fraud
98. Consensus-ad-idem is an essential of

(a) Agreement

(b) Promise

(c) Both (a) & (b)

(d) Consideration

99. Agreement which are not contracts

(a) Social Matters

(b) Relating to partnership
(c) Domestic Agreements
(d) Both (a) & (c)

100. Offeror is ............

(a) Party to whom offer is made

(b) Third party
(c) Party making an offer
(d) None of the above
101. Bailment is a special kind of contract that is
widely used in business and in:

a) Personal affairs
b) Cultural activities
c) Academic research
d) Charitable institution

A transaction in which an owner of a tangible

102.
personal property transfers the property such
property is known as:

a) Bailment
b) Pledge
c) Hypothecation
d) Lease
103. A bailment allows an owner of a personal
property to transfer possession of it to
another individual for any one of the following
purpose; except:
a) Sale
b) Transportation
c) Storage
d) Lease

104. An agreement reached between a bailer and a

bailee is
a) Mortgage
b) Bailout
c) Bailment
d) Codicil

105. Any one in possession of goods can create

bailment relationship and becomes:
a) Bailee
b) Bailor
c) Executor
d) Administrator

106. In general all of the following are requirement

for a bailment; except that the:
a) Bailor must be in possession of goods
b) Bailee must intent to possess goods
c) Bailee must return identical goods
d) Actual ownership of goods is necessary

107. The law concerning bailment provides for

 certain rights and duties of both bailor and
bailee, depending on the:
a) Amount of transaction
b) Nature of business
c) Kind of bailment
d) Competency in the market

108. The transfer of goods from a bailor to a

must actually
take place
Landlord
Bai
lee
Lea
se
Ten
ant

109. A bailment for the sole benefit of a bailer

usually results in ------------
a) Borrowing /lending transactions
b) Spring transaction
c) Declarative transaction
d) Autonomous transaction

110. A bailment in which only the person who

borrows and article gets the benefits is
known as:
a) Bailment for the sole benefits of the
bailee
b) Bailment for the sole benefits of the
bailor
 c) Mutual benefit bailment
d) Constructive bailment

111. A person who finds the goods belonging to

others and takes them into his possession is
called
a) Finder of goods
b) Bailor
c) Pledgor
d) Pawnee

112. Which are the rights of finder of goods

a) Rights of lien
b) Right to sue for reward
c) Right to sale
d) All of the above

113. A bailment is for a specific period, it

terminates on expiry of that period
a) On the achievement of the subject
b) On the expiry of the period
c) Gratuitous bailment
d) Destruction of the subject matter

114. The bailment of goods as security for

payment of a debt or performance of a
promise
a) Pledge
b) Lien
c) Agency
d) Bailment
115. Pledgee is also known as
a) Pawnee
b) Pawnor
c) Principal
d) Agent

116. Pledgor is also known as

a) Pawnor
b) Pawnee
c) Bailor
d) Agent

117. Pledge is made for purpose

a) Any purpose
b) Special purpose
c) Common purpose
d) None of the above

118. Person’s include in pledge

 a) Pledgor and pledgee
b) Bailor and bailee
c) Principal and agent
d) Giver and taker

119. The term bailment is derived from a French

word “bailor”, which means:
a) Depends
b) Deliver
c) Selling
d) Buying

120. What is the essence of the bailment

a) Transfer of ownership
b) Transfer of possession
c) A and B
d) None of these

121. The person delivering the goods for achieving

some purpose and returned the same after
completion is called
a) Bailee
b) Pledgee
c) Bailor
d) Agent

122. The person whom delivered the goods for

bailment process is called
a) Bailee
b) Bailor
c) Pawnor
d) Pawnee
123. What is the subject matter of bailment
a) Movable goods
b) Immovable goods
c) Perishable goods
d) All of the above

124. No consideration passes between the bailor

and bailee
a) Non gratuitous bailment
b) Gratuitous bailment
c) Special bailment
d) Conditional bailment

125. Choose the incorrect; Rights of bailee:

a) Rights of implied
b) Bailor’s lien
c) Termination of bailment
d) Enforcement of duties of bailor
126. Choose the correct one; Duties of bailor
a) To return the goods
b) To disclose known faults
c) Not to set up an adverse title
 d) To return any accretion to the goods

127. Right of a person to retain possession of

some goods belonging to another until some
debts of the person in possession is satisfied
a) Pledge
b) Bailment
c) Lien
d) Guarantee

128. Which of the following is not a type of

bailment
a) Gratuitous
b) deposit
c) Sale
d) Loan for use

129. A gives B two suitcases to store for him while

he is at a meeting. What is the correct
relationship between A and B.
a) A is the bailee and B is the bailor
b) A is the bailor and B is the bailee
c) A and B are both bailees
d) A and B are both Bailor

130. Which of the following is not an example of

bailment
a) A coat check
b) Valet parking
c) Dry cleaning
d) A gift you give someone for their birthday

131. Law relating to agency is contained in …….

 Chapter of the Indian Contract Act.
a. Chapter IX
b. Chapter X
c. Chapter XI
d. Chapter XII

132. A person employed to do any act for another

person is called.
a. Agent
b. Principal
c. Agency
d. Bailor

133. Who has the primary responsibility in agency?

a. Principal
b. Agent
c. Bailor
d. Bailee

134. The contract which creates the relationship of

an agent and principal
a. Agency
 b. Bailment
c. Pledge
d. Offer

135. An agent who is appointed to perform a

particular act.
a. General agent
b. Universal agent
c. Special agent
d. Commercial agent

136. An agent who has authority to do all acts

connected with a particular trade, business
or employment.
a. Commission agent
b. General agent
c. Del credere agent
d. Broker

137. An agent whose authority to bind his principal

is almost unlimited.
a. General agent
b. Universal agent
c. Auctioneer
d. Factor
138. When does apparent authority of an agent
arise?
a. When the acts with the usual authority of
the job
b. When the principal gives the agent implied
authority to act
c. When the agent has actual authority to act
 d. When the principal represents to a third
party that an agent has the authority to
act when in fact he doesn’t

139. Which one of the following is not a duty of an

agent?
a. Duty to exercise care and skill
b. Duty to take a commission
c. Duty to account
d. Duty to avoid conflict of interest

140. What is undisclosed agency?

a. When a third party is not informed of the

exercise of the principal and believes the

agent is acting on his own behalf.
b. When the agent indicates through conduct
he is acting as an agent.
c. When the principal is not in existence.
d. Where the third party knows there is a
principal but doesn’t know his name.

141. Which of the following statement is incorrect?

a. An agency may be terminated by death of
either party.
b. An agency may be terminated by express
agreement.
c. An agency agreement can always be
terminated by a principal.
 d. Mental incapability of an agent will
terminate the agency relationship.

142. An agency relationship which is made

retrospectively is known as an agency by:
a. Estoppel
b. Ratification
c. Necessity
d. Commerce

143. Which one of the following statement is

incorrect?
a. An agent create a loyal relationship
between a third party and principal.
b. All agents are entitled to be paid for their
services.
c. An agency relationship may be created
through necessity
d. An agency relationship may be created
through estoppel.

144. …… is an agent who is appointed to sell goods

at a public auction for reward.
a. Commission agent
b. Broker
c. Auctioneer
d. Factor
145. Agent acts the role of both a guarantor and an
agent
a. Factor
b. Del credere agent
c. Special agent
 d. General agent

146. Where both the name and existence of the

principal are not disclosed in the contract.
Such principal is called
a. Undisclosed principal
b. Unnamed principal
c. Named principal
d. Prohibited principal

147. Which one of the following is not a duty of an

agent?
a. Right of retainer
b. Right of lien
c. Right to remuneration
d. Right to recover damage

148. A person employed by, and acting under the

control of the original agent is
called…….
a. Substitute agent
b. Co-agent
c. Sub agent
d. Universal agent

149. Which of the following is not a terminator of

agency by operation of law?
 a. Expiry of time
b. Revocation by the principal
c. Insolvency
d. Death

150. A......duty is to bring together the buyer and

seller and make the sale happen.
a. Broker’s
b. Factor’s
c. Commission agent’s
d. Del credere agent’s

151. A.......is a mercantile agent entrusted with the

possession of goods for the
purpose of selling them.
a. Commercial agent
b. Factor
c. Broker
d. Commission agent
152. Which of the following is not a type of
commercial agents?
a. Banker
b. Special agent
c. Broker
d. Commission agent

153. Which of the following is not a right of the

principal?
a. Right to recover damage
b. Right to demand account and to claim
secret profit made.
c. Right to remuneration
 d. To resist agent’s claim for indemnity.

154. Which of the following is not a duty of

principal?
a. To pay remuneration to agent
b. To indemnify the agent against the
consequences of all lawful acts.
c. Right to be indemnified against
consequences of acts done in good faith
d. Duty to pay money received.

155. Which of the following is not a non-mercantile

agent.
a. Attorneys
b. Insurance agent
c. Factor
d. Solicitors

156. Substitute agent is also called

a. Co-agent
b. Sub agent
c. Junior agent
d. Duplicate agent
157. Which of the following is not a termination of
agency by acts of the parties.
a. Agreement
b. Revocation by principal
c. Insolvency
d. Revocation by agent

158. Which of the following is not a situation of

irrecoverable agency
a. Where the agency is coupled with interest.
b. Where the agency has incurred a personal
liability.
c. Where the agent has partly exercised his
duty.
d. Where the agent doesn’t exercised his duty.

159. Which one of the following is not a duty of an

agent?
a. Duty to exercise care and skill
b. Duty to take a commission
c. Duty to account
d. Duty to avoid conflict of interest

160. What is undisclosed agency?

a. When a third party is not informed of the

exercise of the principal and believes the

agent is acting on his own behalf.
b. When the agent indicates through conduct
he is acting as an agent.
c. When the principal is not in existence.
d. Where the third party knows there is a
principal but doesn’t know his name.
161. The sale of goods act 1930 deals with the

a) movable goods only

b)period of contract

c) immovable goods

d)none of the above

162. Contract of sale may be

a) agency relationship

b)sale or

agreement

c)indemnit

d)guarant

ee.

163. Representation of contract for the main purpose

are called

a) warranties b)conditions
 c) agreements d)members

164. Warranty is a contract means

a) collateral to main purpose b)condition to main

purpose

c) representation to main purpose d)none of

the above

165. A contract for the sale of goods which provides

that the property would pass to the buyer on full
payment of price and execution of sale deed is
known as

a)sale of approval

b)hire purchase agreement

c) sale

d)agreem

ent to sell

166. The term goods for the purpose of sale of goods

act does not include

a) actio

nable

b)mon
 ey

c) immovable property

d)all of these

167. A contract for the sale of “future goods is “

a) agreeme

nt to sell

b)sale

c)

void

d)voi

dable

168. The merchantable in sec 14(2)defined in

a) Indian contract act

b) sale of goods act

c) English sale of goods act

d) none if this

169. In a hire purchase agreement the hirer

a) must buy the goods

 b)must return the goods

c) has an option to buy the goods

d)not given the possession of goods

170. which of the following is not an implied

conditions in a contract of sale?

a) condition as

to description

b)condition as

to title

c) condition as to free

from encumbrance

d)condition as to

sample

171. which of the following modes of delivery of

goods is considered effective for a valid
contract of sale?

a) constructive delivery

b)symbolic delivery

c) actual delivery
 d)all of this

172. Delivering the keys of a godown in which goods

sold are stored amounts to

a) delivery by attornment

b)symbolic delivery

c) actual delivery

d)none of these

173. The unpaid seller can exercise his right of lien

over the goods for

a) any lawfull charges

b)price of goods

c) storage charges

d)all of these

174. In case on sale of approval the ownership is

transferred to the buyer when he

a) adopts the transactions

b)accept the goods

 c) fail to return goods

d)in all the above cases

175. On the payment of price by the buyer ,if the

seller fails to deliver the goods ,then the
buyer can file a suit for

a) refund

of price

b)interes

c) none of this

d)both (a )and (b)

176. An auction sale is complete on the

a) fall of hammer

b)delivery of goods

c) payment of price

d)both (b) and (c)

177. where the goods are delivered to a carrier or

wharfinger for the purpose of transmission to the
buyer, the delivery is
 a) invalid delivery

b)valid and effective

c) conditional

d)none of this

178. The property in the goods means the

a) possession of goods

b)custody of goods

c) ownership of goods

d)both(a) and (b)

179. The goods are the risk of a party who has the

a) ownership

of goods

b)possessio

n of goods

c) custody of goods
 d)both (b) and (c)

180. In Case of unconditional contract of sale, the

property passes to the buyer at the time of
making the contract. for this to apply, the goods
must be

a) specific

b)in a deliverable state

c) physically transferred to buyer

d)both(a) and (b)

181. In which of the following cases, the unpaid seller

loses his right of lien?

a) delivery of goods to buyer

b)delivery of goods to carrier

c) tender of price by buyer

d) all of these

182. where in an auction sale, the seller appoints

more than one bidder, the sale is

a) illega

l
 b)void

c)cond

itional

d)void

able

183. “No one can transfer rights which he himself

does not have” that principle carried in

a) companies

act 2013

b)industrial

act

c) “nemodat quod non habet”

d)none of the above

184. A stipulation which is essential to the main

purpose of the contract and if prove false give
the buyer a right terminate the contract is
legally known as

a) guar

antee

b)con
dition

c) warranty

d)none of these
185. In case a condition is changed to the

status of a warranty ,then the buyer

a)loses the right to reject goods

b) retains right claim damages only

c) both (a) and (b) are true

d) both (a) and (b) are false

186. The unpaid seller can exercise his right of

stoppage of goods in transit where the buyer

a)refuse to pay price

b) acts fraudulently

c) become insolvent

d) all of these

187. where by exercising the right of stoppage

in transit the unpaid seller regains the
possession of goods, then

a) unpaid seller lien revives

b)contract of sale in terminated

c) unpaid seller lien does not revive

 d)sellers possession in unlawful

188. where the seller has expressly reserved his right

to bid in the auction to bid in his behalf
,the seller can appoint

a) only one bidder

b) two bidders

c) any number of bidders

d) none,seller has no such right

189. A bidder at an auction sale can withdraw his bid

a) before fall on hammer

b)any time during auction

c) before payment of price

d)none of these
190. On sellers wrongful refusal to deliver the
unascertained goods to the buyer, the buyer can
file a suit for recovery of

a)goods

b)damag

es c)both

(a) and

(b)

d)none of these

191.A contract by which one party promises to save

the other from loses caused to him by the conduct
of the promise himself or by the conduct of any
other person is called a

a) Contract of indemnity

b) Contract of guarantee

c) Quasi contract

d) none of these

192. The person who promises to make good the loss

is called the

a) Indemnified
 b) None of these

c) Indemnifier

d) Indemnifier holder

193. Theperson whose loss is to be made good is

called the

a) Indemnifier

b) Principal Debtor

c) Indemnity holder

d) none of these

194. Whena guarantee extends to a single

transactions or debt it is called

a) Retrospective guarantee

b) Specific Guarantee

c) Prospective guarantee

d) Fidelity guarantee
195. A continuing guarantee may at any time
be revoked by the surety as to future
transactions by giving a to the creditor.

a) By notice b) By Oral

c) By death of surety ` d) none of these

196. is a guarantee given for the good conduct

or honesty of a person employed in a particular
office.

a) Fidelity guarantee

b) Continuing Guarantee

c) Retrospective guarantee

d) specific guarantee

197. When a guarantee given for an existing debt or

obligation it is known as

a) Specific guarantee

b) fidelity guarantee

c) Retrospective guarantee

d) continuing guarantee

198. A is a contract to person the promise or to

discharge a liability of a third person in case of his
default.

a) Contract of indemnity

b) contract of guarantee

c) Implied contract

d) express contract

199. The person who gives the guarantee is called

a) A surety

b) Guarantee

c) Competent

d) creditor

200. The person to whom the guarantee is given is

called

a) Indemnifier
 b) Principal debtor

c) Indemnified

d) Creditor

ANSWER KEY

Q An Q An Q An Q An
No s No s No s No s
1 b 51 a 101 a 151 b
2 b 52 a 102 a 152 b
3 d 53 a 103 d 153 c
4 b 54 b 104 c 154 d
5 c 55 d 105 b 155 c
6 d 56 a 106 d 156 a
7 b 57 d 107 c 157 c
8 a 58 c 108 b 158 d
9 b 59 a 109 a 159 b
10 b 60 b 110 a 160 a
11 b 61 a 111 c 161 a
12 a 62 d 112 d 162 b
13 a 63 c 113 b 163 b
14 d 64 a 114 a 164 a
15 c 65 b 115 a 165 d
16 b 66 a 116 a 166 d
17 c 67 a 117 b 167 a
18 b 68 b 118 a 168 c
19 b 69 a 119 b 169 c
20 b 70 c 120 b 170 c
21 c 71 c 121 c 171 c
22 a 72 a 122 a 172 b
23 a 73 d 123 a 173 d
24 c 74 d 124 b 174 c
25 b 75 a 125 c 175 a
26 b 76 d 126 b 176 a
27 a 77 c 127 c 177 b
28 b 78 b 128 c 178 c
29 d 79 d 129 b 179 a
30 c 80 c 130 d 180 a
31 a 81 d 131 b 181 c
32 b 82 c 132 a 182 d
33 c 83 b 133 a 183 c
34 a 84 b 134 a 184 c
35 d 85 b 135 c 185 c
36 b 86 a 136 b 186 d
37 c 87 a 137 b 187 c
38 c 88 b 138 d 188 a
39 d 89 d 139 b 189 a
40 a 90 b 140 a 190 d
41 c 91 a 141 c 191 a
42 a 92 d 142 b 192 c
43 a 93 b 143 b 193 b
44 b 94 d 144 c 194 b
45 a 95 d 145 b 195 a
46 d 96 a 146 a 196 a
47 b 97 a 147 d 197 a
48 a 98 a 148 c 198 b
49 b 99 b 149 b 199 a
50 a 100 c 150 a 200 d