END TERM EXAMINATION, NOVEMBER 2016
B.A.LL.B. (HONS.)
SEMESTER-VII IX
CLS-Corporate Regulation (Hons.-II)
Max. Marks: 60 Time Allowed: 3:00 Hrs.
Note: Answer five questions including Question No. 1 which is compulsory. The number of marks
carried by each question is indicated at the end of the question.
1. Answer the following (each answer should be in approximately 100 words): (Marks 2×10=20)
a. "Hedge Funds are close ended funds." Do you agree with the statement? Give reason for your
answer.
b. Corporate Governance conflict is between whom in India? Is this conflict same as UK and
USA.
c. State the difference between Mutual Fund and Collective Investment Scheme.
d. Is a gold scheme issued by Jewelers in India a CIS? Discuss
e. Discuss the provision of Companies Act, 2013 which talks about derivative action.
f. Through which provision Listing Agreement becomes mandatory. Is Listing Agreement
abolished after LODR came into picture? Support your answer through legal reasoning
g. How LODR has brought Listing Agreement and Companies Act provisions related to
Independent Director in harmony. Explain
h. Can a person who has procured the unpublished price sensitive information of Axis Mutual
Fund be punished for insider trading?
i. Is Fraud punishable under companies Act? Yes or No. If yes, then does it overlap with the
provisions of SEBI (Prohibition of Fraudulent and Unfair Trade Practices Related Securities
Market) Regulation, 2003? If No, then is SEBI's regulation alone suffice enough to cover
entire ambit of fraud.
j. What is MCA-21? Discuss.
2. Ashoka Ltd. is a public limited company which has just commenced its business with the share
capital of six lakhs fifty thousand along with eight members. Live Angel Fund Ltd. with net worth
of 15 crore found this company as a profitable investment. Now as a legal advisor of the fund
answer the following question based on the above scenario:- (Marks 5+2.5+2.5=10)
a. Will you suggest them to invest in Ashoka Ltd. with the point of view of easy exit after three
years? What measures should be taken by the fund for the hassle free exit and how they can
exit.
b. Live fund wants to invest 4 crores 25 lakhs in Ashoka Ltd. Are you in favour of this
investment, can they go forward with this. Give reasons
c. Some of the members of Fund are opposing this investment and want that angel fund should
invest in another debt fund formed by these members itself, as debt fund needs investment.
Can they do so? Support your answer through legal reasoning.
3. Credible Corporation has come up with a policy for its employees for one year that every
month portion of the salary of its employees would be deducted and the money collected would be
invested in the development of café of the company. Later every employee could eat free food up
to the amount collected from them. Every employee voluntary agreed for the deduction and even
propose certain plans regarding structure and menu of café. It came as happy news for the
employees and company even disclosed the name of the agency who would be managing the café.
Is this scheme a Collective Investment Scheme? Justify your answer with the help of legal
provisions and cases (if needed) (Marks 05)
Discuss the kinds of rights given to the members of the company. (Marks 05)
4. Short answer- (Marks 2×5=10) a. What is Proactive and Reactive Control? Which of these could qualify as effective control? Explain b. Define Stock Exchange. What do you mean by demutualization and corporatization- in the given definition? c. What are the objectives of Listing Obligation and Disclosure Requirements Regulation? d. What do you understand by CIMC. Discuss the criteria required to be registered as CIMC. e. What does Sponsor means in Alternate Investment Fund. What is the continuing interest to be maintained by sponsor's in different categories of fund.

5. "Due to economic liberalization and de-regulation of industry and business, with changing times, there was the need of greater accountability of companies to their shareholders and customers. Thus came the concept of Corporate Governance." Do you agree with the statement? Discuss the concept of corporate governance with special emphasis to New Companies Act, 2013 and Clause 49 of Listing Agreement. (Marks 10)

6. Ombudsman is the concept which is present in banking sector as well as insurance sector. SEBI has also introduced the concept of Ombudsman through its regulation but still the ombudsman in securities sector remains in paper. What according to you are the defects because of which Ombudsman has yet not become the reality in capital market? Also discuss the current redressal mechanism of SEBI. (Marks 10)

7. Depository mechanism is a step towards paperless securities market. (Marks Which model of depository does India follow? Discuss the model. ii) Is pledge and hypothecation same under depository system. Discuss the manner in which pledge is created in depository mechanism. iii) Also discuss the difference between registered and beneficial owner. Insider trading a practice which needs to be controlled, so that market could flourish in honest and effective manner on its own. Is Trading Plan an effective defense for insider trading according to you? Explain Trading Plan. Every year a company use to announce dividends in the month of April. This year company decided not to give dividends because of various reasons and was about announce the same after one week. Director, who had this information before announcement, conveyed the same to some shareholders. Being investor shareholders were unhappy after hearing that but did not take any further action after acquiring this information. Will director be liable for insider trading? Was that unpublished price sensitive information. Discuss. (Marks