CBSE Class 12 Sample Paper 2026 Solution for Legal Studies

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LEGAL STUDIES Code No. 074
Marking Scheme
Class – XII (2025-26)

S.No. Question Marks

SECTION A

Ans. 1 b) The court extended the concept of locus standi in public interest. 1

Ans. 2 c) The mortgage contract is void and Mihir will not be able to recover his money 1
advanced to Bhavya.

Ans. 3 b) A (ii); B (iv); C (i); D (iii) 1

Ans. 4 d) Consensus Ad Idem 1

Ans. 5 b) Lease 1

Ans. 6 c) A is true, R is false 1

Ans. 7 b) Both (A) and (R) are true but R is not the correct explanation of A 1

Ans. 8 a) Chaman forfeits the gift of rupees ten lakhs due to the doctrine of election. 1

Ans. 9 b) Native ADR techniques in India existed even before the establishment of 1
English-style courts during the British colonial period.

Ans. 10 b) Mutation 1

Ans. 11 b) Right of Integrity 1

Ans. 12 c) Providing opportunities for education to children by their parents between 1
the age of six and fourteen years.

Ans. 13 c) She will have to wait before the Central Administrative Tribunal for disposal 1
of her case.

Ans. 14 d) Restoration 1

Ans. 15 b) Judge advocate general’s (jag) department 1

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Ans. 16 a) Ms. Hazra fought for women to be allowed to appear as advocates in the 1
Patna High Court, challenging the restriction that limited legal practice to men
only.

Ans. 17 b) An Advocate on Record must always file the case, while Senior Advocates 1
can only argue the case after it is filed.

Ans. 18 b) Insurance Ombudsman 1

Ans. 19 c) Geographical Indication 1

Ans. 20 c) The court should formulate settlement terms, share them with the parties for 1
feedback, and based on their input, refer the case to a suitable ADR.

SECTION B

Ans. The grounds for impeachment are proved misbehavior or incapacity. 1+1
21A
The motion requires:
i. A majority of the total membership of each House of Parliament, and
ii. A two-thirds majority of the members present and voting in each House.

OR

21B Under Article 131, the Supreme Court exercises original jurisdiction to resolve 1+
disputes directly filed before it, primarily involving:
i. Disputes between the Government of India and one or more States.
ii. Disputes between two or more States.
This differs from:
Appellate Jurisdiction, where the Supreme Court hears appeals against
decisions of lower courts. 0.5+

Advisory Jurisdiction, where the President seeks the Court’s opinion on 0.5
constitutional matters

Ans. 22 i. The Court must be satisfied that the deceased was in a fit state of mind to 1+1
make the statement after the deceased had a clear opportunity to observe
and identify his assailants and that he was making the statement without
any influence.
ii. If the dying declaration is coherent, consistent and trustworthy and appears
to have been made voluntarily, conviction can be based on it even if there’s
no corroboration

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iii. A dying declaration which has been properly recorded by a competent
magistrate, in the form of questions and answers, and as far as practicable
in the words of the maker of the declaration is reliable.

Ans. The primary functions of the Lokpal and Lokayuktas under the Lokpal and 1+1
23A Lokayukta Act, 2013 are:

Lokpal: Investigates allegations of corruption against public servants, including
the Prime Minister, Members of Parliament, Group A, B, C, and D officials, and
officials of public sector undertakings.

Lokayuktas: Perform a similar role at the state level, addressing complaints of
corruption against state public servants.

Both aim to ensure accountability and transparency in governance.

OR

23B i. Lok Adalats ensure speedy and cost-effective dispute resolution by 1+1
providing an informal setting where disputes are resolved amicably
through mutual agreement.

ii. They eliminate the need for lengthy court procedures and litigation costs,
as the awards passed by Lok Adalats are binding, final, and have the same
legal status as a court decree.

Ans. 24 NCPCR- National Commission for Protection of Child Rights 1+
NCPCR enquires into complaints raised either by children themselves or by a
concerned person on their behalf.

It can investigate complaints and also take suo moto notice of matters related 0.5+
to: 0.5
1. Deprivation and violation of child rights.
2. Non implementation of laws providing for protection and development of
children.
3. Non compliance of policy decisions, guidelines or instructions aimed at
mitigating hardships to and ensuring welfare of the children.
(mention any two)

Ans. (1) consistent and general international practice by states- it is the 1+1
25A widespread repetition of similar international acts over time by states
(State practice)

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and
(2) a subjective acceptance of the practice as law by the international
community - the requirement that the acts must occur out of a sense of
obligation (opinion juris)

OR

25B I. Article 59 of the Statute of the ICJ implies that the decisions of the Court 1+1
are not binding on parties that are not directly involved in a specific case.

II. The binding effect is limited only to the disputing parties and applies solely
to the particular case in question.

Ans. 26 Merely talking about human rights from an elitist platform is not sufficient. In 0.5*4
order to do social justice for them and to make human rights meaningful, legal
aid becomes essential.

Human Rights which cannot be enforced due to poverty are meaningless and
worthless. A right to access to justice is sine-qua-non for social justice.

Indeed, poverty is an obstacle in the way of getting justice and due to this
reason, the poor become a sufferer of social injustice.

Legal aid indeed, is an integral part of human rights and it requires urgent
considerations, otherwise, there is an apprehension that someday the patience
of poor persons may be exhausted and that will endanger world peace.

Ans.27 The Collegium System in India refers to the mechanism through which 1+
appointments and transfers of judges to the higher judiciary (i.e., the Supreme 0.5+
Court and High Courts) are made. 0.5

Primary Role:
The Collegium recommends names for the appointment and transfer of judges
in the higher judiciary.

Composition:
 For the Supreme Court, the Collegium consists of:
o The Chief Justice of India (CJI)
o Four senior-most judges of the Supreme Court
 For the High Court, it includes:
o The Chief Justice of the High Court
o Two senior-most judges of that High Court

4|Page

Ans.28  The company is using a trade secret. 1+1
 Key difference: A trade secret remains protected as long as it is kept
confidential, whereas a patent requires public disclosure and has a limited
protection period (usually 20 years).

SECTION C

Ans. Increasing the retirement age of judges will have significant benefits. 3
29A
 Senior serving judges will bring with them years of experience. It will ensure
the continued presence of a strong talent pool of experienced judges.
 New judges can be appointed without displacing existing judges.
 It will address the problem of mounting arrears. It will be a buffer against
impending litigation explosion.
 It will render post-retirement assignments unattractive and, as a
consequence, strengthen the rule of law and the independence of the
judiciary, both of which are crucial to sustain democracy.

OR

29B i. Centre-State Relations 3

Judicial review has also been used in matters concerning the legislative
competence with regards to the Centre-State relations. Article 246 of the
Constitution provides that the Parliament has exclusive powers to make laws
with respect to matters itemized in the ‘Union List’ (List 1 of the Seventh
Schedule of the Constitution). It provides further that both the Parliament and
the Legislature of any State have powers to make laws with respect to matters
enumerated in the ‘Concurrent List’ (List III of the Seventh Schedule of the
Constitution). With respect to the States, it provides that the Legislature of any
State has exclusive power to make laws with respect to matters listed in the
‘State List’ (List II of the Seventh Schedule). This Article delivers a clear division
of law-making powers (division of powers) as well as room for an intersection
between the Centre and the State.

Judicial review helps demarcate the legislative competencies and ensures that
Centre does not exert its supremacy over the state matters and likewise states
do not encroach upon matters within the ambit of the Centre.

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ii. Fairness in Executive Actions
In matters of executive or administrative actions, the judicial review practice of
courts has often employed doctrines like ‘principles of natural justice’,
reasonableness’, ‘proportionality’, and ‘legitimate expectation’;

There is a Latin phrase audialterampartem, which means ‘listen to the other
side’. This phrase is an established principle in the Indian law practice and was
applied by the Supreme Court in several cases. In the landmark decision of
Maneka Gandhi v. Union of India, the court adopted the principle of post-
decision-hearing, in situations of urgency where a prior hearing is not feasible,
and recognized that a chance of hearing cannot be debarred completely.

Ans. 30 (I) International Law is a framework of rules and principles binding the 3
relations between states, governing their conduct amongst themselves
and other international entities that are legally recognized and between
citizens of other nations. It is a system of treaties and agreements
between nations that governs how nations interact with other nations,
citizens of other nations, and businesses of other nations.

(II) Public International Law
Private International Law

Ans. The Permanent Lok Adalats were established under Legal Services Authorities 3
31A (Amendment) Act, 2002 to settle disputes concerning public utility services at
pre-litigation stage.
The Permanent Lok Adalat shall, during conduct of conciliation proceedings
assist the parties in their attempt to reach an amicable settlement of the dispute
in an independent and impartial manner. In case the parties reach at an
agreement on the settlement of the dispute, they shall sign the settlement
agreement and the Permanent Lok Adalat shall pass an award in terms thereof.
Where the parties fail to reach at an agreement, the Permanent Lok Adalat
shall decide the dispute.

Lok Adalat Permanent Lok Adalat
Temporary bodies established Permanent bodies established
under the Act of 1987. under the Act of 2002
Deals with a wide range Focuses on public utility services.
of civil and criminal
matters.

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OR

31B The Legal Services Authorities Act, 1987 was enacted to fulfill the mandate of 3
Article 39A of the Indian Constitution, which directs the State to ensure that
justice is not denied to any citizen due to economic or other disabilities. The
Legal Services Authorities Act was enacted to give a statutory base to legal aid
programs throughout the country on a uniform pattern.

I. Objectives for its enactment:

1. Article 39A emphasizes free legal aid and access to justice for all.
2. Articles 14 and 21 of the Constitution uphold equality before the law and
the right to life and personal liberty, which includes access to justice.
3. Economic disparities and lack of legal awareness among marginalized
communities created barriers to accessing the judicial system.
II. Promote access to justice:
i. provide free and competent legal services to the weaker sections of the
society to ensure that opportunities for securing justice are not denied to
any citizen by reason of economic or other disabilities, and
ii. to organize lok adalats to secure that the operation of the legal system
promotes justice on a basis of equal opportunity

Ans. 32 This is an example of a contingent contract where the performance is 3
dependent on an uncertain future event. Because the condition (Neha securing
the loan) did not occur, the contract does not bind Rohit to sell the car.
Contingent contracts are valid.
Amber cannot legally receive or sell the smartphones, rendering the contract
unenforceable. The law prohibits the importation of these goods, causing the
contract to become void.
The contract becomes void if its performance is rendered impossible due to a
change in law or government policy, making it unenforceable.

Ans. 1. Foreign Arbitration 3
33A
- The dispute involves an Indian company and a supplier based in Singapore,
with arbitration governed by the rules of the Singapore International Arbitration
Centre (SIAC). This constitutes Foreign arbitration, as the arbitration is
conducted under the auspices of a foreign institution (SIAC), and the arbitration
process follows its rules, which may differ from Indian arbitration norms.

7|Page

2. International Commercial Arbitration
- In this case, the dispute between two multinational companies (one in India
and the other in the UK) is resolved through international commercial
arbitration, with the International Chamber of Commerce (ICC) administering
the arbitration. This is an example of international commercial arbitration
because the dispute involves commercial interests between parties from
different countries, and the ICC is an international body administering the
arbitration process.

OR

Ans. 1: Facilitative Mediation 3
33B In this scenario, a neutral mediator helps the parties (Mr. X and Mr. Y)
communicate effectively and understand each other's perspectives. Facilitative
mediation focuses on improving communication and guiding the parties
towards a mutually agreeable solution without imposing a decision. It is suitable
here as the partners are willing to preserve their relationship and need
assistance in resolving their conflict through dialogue.

2: Transformative Mediation
In this case, the mediator focuses on transforming the relationships between
the family members, addressing the emotional aspects of the dispute and
fostering mutual understanding. Transformative mediation is particularly suited
for deeply rooted conflicts, as it emphasizes empowering the parties and
improving their interaction to resolve issues at a personal and emotional level.

Ans. 34 (i) Image A- Assault 3
Image B- Battery
(ii)
S.No Basis Assault Battery

1. Meaning The tort of assault occurs The tort of battery occurs
when the defendant intends to when the defendant
cause in the claimant’s mind a shows an intentional and
reasonable apprehension direct application of
(feeling of anxiety or fear) of physical force of the
an imminent harmful or claimant with the intent to
offensive touching to the cause harm or offense.
claimant;

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2. Require Does not require physical Requires actual physical
ment of contact; it is based on the contact with the victim.
Contact victim's fear of immediate
harm.

3 Example Hitting, slapping, or pushing Threatening to punch
someone. someone or raising a fist
in a threatening manner.

Ans.35 Legal aid can be denied or withdrawn in the following circumstances: 3

1. Legal aid can be denied if a person is found ineligible under Section 12
of the Legal Services Authorities Act, 1987;
2. Legal aid can be withdrawn if the aided person who applied under the
income category is found to possess sufficient means;
3. Legal aid can be withdrawn where the aided person obtained legal
services by misrepresentation or fraud;
4. Legal aid can be withdrawn where the aided person does not cooperate
with the Legal Services Authority/Committee or with the legal services
advocate;
5. Legal aid can be withdrawn where the person engages a legal practitioner
other than the one assigned by the Legal Services Authority/Committee;
6. Legal aid can be withdrawn in the event of death of the aided person
except in the case of civil proceedings where the right or liability survives;
7. Legal aid can be withdrawn where the application for legal service or the
matter in question is found to be an abuse of the process of law or of legal
services.
(Mention any three)

Ans. Three key features of the National Legal Services Authority (Free and 3
36 A. Competent Legal Services) Regulations, 2010 regarding the involvement of
lawyers for legal service are:

1. Selection of Panel Lawyers:
Legal services institutions select panel lawyers with a minimum of three
years of experience, based on their competence, integrity, and suitability.
Separate panels are maintained for different types of cases.

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2. Restrictions on Panel Lawyers regarding payment of fees:
Panel lawyers are paid fees as per State regulations after the completion
of proceedings.

Panel lawyers are not allowed to accept any fee or valuable consideration
from the beneficiaries of legal aid. They must perform their duties
diligently and may be removed for non-performance or misconduct.

3. Involvement of Senior Advocates:
Senior advocates may be engaged in special cases involving serious
threats to life and liberty or matters of great public importance, if approved
by the Chairman of the legal services institution.
Components of Free Legal Services:
 Payment of court and process fees and all other charges payable or
incurred in connection with any legal proceedings.
 Provision of service of lawyers in legal proceedings.
 Obtaining and supply of certified copies of orders and other documents in
legal proceedings
 Provision of aid and advice to the beneficiaries to access the benefits
under the welfare statutes and schemes framed by the Central
Government or the State Government and to ensure access to justice in
any other manner.

(Mention any three)

OR

36 B Components of Free Legal Services: 3
 Payment of court and process fees and all other charges payable or
incurred in connection with any legal proceedings.
 Provision of service of lawyers in legal proceedings.
 Obtaining and supply of certified copies of orders and other documents in
legal proceedings
 Provision of aid and advice to the beneficiaries to access the benefits
under the welfare statutes and schemes framed by the Central
Government or the State Government and to ensure access to justice in
any other manner.

(Mention any three)

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SECTION D

Ans. a. Litigation: Graduates may practice as an advocate in a court of law. This 5
37A can be achieved by working under experienced advocates or being
attached to litigation departments of law firms or companies in order to
practice in the Courts of India.

b. Law Firm Practice: Law firms vary in size and practice areas. Law firms
may range from boutique law firms specializing in specific areas of law
(such as Intellectual Property Rights and Tax law), to mid- sized law firms
as well as large law firms which are full service law firms with different
practice groups such as general corporate, mergers and acquisitions,
employment law, taxation, international trade, insurance, intellectual
property, and project finance and infrastructure. Corporate lawyers would
also advise on regulatory issues and legal compliance. Centres for Legal
Process Outsourcing (LPOs) also have a lot of transnational transactional
work.

c. Corporate Sector: Large corporations often have an in-house legal
practice. An inhouse counsel will give legal advice to the company, have
expertise in the business of the company and be responsible for ensuring
that the business of the company is being run in compliance with
applicable laws and when required will bring in external lawyers. Several
organisations such as commercial banks, multinational companies,
investment firms, insurance companies, e-commerce ventures, media
houses are hiring law graduates for managing their legal departments.

d. Public Policy: Lawyers have an important role in formulating and advising
on public policy. Several organizations employ law graduates for policy
making and have institutionalized fellowships where law graduates can be
Research Assistants. Institutions such as Competition Commission of
India and Securities and Exchange Board of India also employ law
graduates for policy making in the respective fields. Law firms have
established Government Policy Departments where they employ law
graduates for policy research.

e. Legal Research and Academia: Graduates may attach themselves with
Research Centres and think tanks. Law graduates may take up teaching
and research as a profession. At least a post graduate degree in Law or

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related disciplines is expected to build a career in academics. Universities
employ postgraduates in law as lecturers/Assistant Professors at the
beginning of their careers. Short term positions and opportunities as
Visiting Professors/Adjunct professors are also available in academia.

f. Non-Governmental Organizations: Not-for-profit organizations,
especially organizations with a social justice orientation have positions for
law graduates. These range from small grassroot level organizations to
large well-funded organizations. They may be general in nature providing
free legal aid, legal education and legal awareness to more specialist
organizations involved in areas such as women and child rights,
environmental law, employment laws, consumer rights and public health.
Government Institutions:, Government departments, statutory authorities,
public sector undertaking and regulatory bodies also provide interesting
opportunities to lawyers. Graduates may opt for jobs in the government
sector in institutions such as National Human Rights Commission, Law
Commission of India, and National Commission for Women etc.

g. Judicial Services/ clerkships: The court system provides several
avenues to law graduates. The higher judiciary, that is judges of the High
Courts and Supreme Courts have law clerks cum research assistants who
assists a judge in researching for cases, maintaining paperwork etc.
Judicial clerks often sit in court hearings with the judges. Graduates may
write the All India Judicial Services Examination to avail of positions in the
Indian Judiciary. Qualifying candidates start in subordinate courts and
may then progress to hold offices in the High Courts and even the
Supreme Court of India.

h. Judge Advocate General (JAG) Officer: The Judge Advocate General’s
(JAG) Department is the legal branch of the Indian Army. It deals with
military related disciplinary cases and litigation and assists in providing
legal assistance to the army in human rights matters and the rule of law
among other things.The service rendered in the JAG’s Department are
considered to be Judicial service as per the regulations for the Indian
Army.

OR

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37B Legal education varies significantly across India, the UK, and the USA in terms 5
of structure, curriculum, and professional requirements.

India:
Structure: Legal education in India typically follows a five-year integrated
undergraduate program (BA LLB), or a three-year LLB program after
completing an undergraduate degree. Both are followed by a period of practical
training or internship.
Curriculum: The curriculum is regulated by the Bar Council of India (BCI) and
includes subjects such as Constitutional Law, Criminal Law, Civil Procedure,
Family Law, and Environmental Law. The focus is on theoretical understanding
with limited practical exposure during the academic phase.

Professional Requirements: After completing the degree, graduates must
clear the All India Bar Examination (AIBE) to practice law. The legal profession
in India is regulated by the Bar Council of India.

United Kingdom:
Structure: In the UK, legal education consists of a three-year undergraduate
law degree (LLB), followed by a one-year vocational course known as the Bar
Professional Training Course (BPTC) for barristers, or the Legal Practice
Course (LPC) for solicitors. Alternatively, aspiring lawyers can take a non-law
undergraduate degree and then complete a Graduate Diploma in Law (GDL).

Curriculum: The curriculum is heavily focused on both theoretical foundations
and practical application, with a distinction between academic study and
vocational training. Subjects like Contract Law, Tort Law, and Criminal Law are
core, while students also specialize in their chosen area during vocational
courses.
Professional Requirements: After the vocational course, candidates must
complete a period of pupillage (for barristers) or a training contract (for
solicitors) before qualifying as a barrister or solicitor. The profession is
regulated by professional bodies like the Bar Council of England and Wales
and the Solicitors Regulation Authority.

United States of America (US):
Structure: Legal education in the US follows a unique path. After completing a
four-year undergraduate degree, students attend a three-year law school (Juris
Doctor or JD program). Admission to law school requires passing the Law
School Admission Test (LSAT).

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Curriculum: The JD curriculum includes foundational subjects like
Constitutional Law, Contracts, Torts, and Civil Procedure, along with electives
in areas like Corporate Law, Environmental Law, and Intellectual Property. The
curriculum emphasizes practical skills through clinics, externships, and moot
court activities.

Professional Requirements: After earning a JD, graduates must pass the bar
exam in the state where they wish to practice. Each state has its own bar exam,
and passing it qualifies the graduate to practice law in that jurisdiction. The
legal profession is regulated by state bar associations.

While legal education in India, the UK, and the USA shares common goals of
preparing students to practice law, the pathways, professional requirements,
and practical training vary.

Ans.38 a. Article 22 -Protection against arrest and detention 1+4

Article 22 provides safeguards against arrest and detention in following ways:
i. No one can be detained in custody without providing grounds for arrest.
ii. The arrested and detained person has a right to consult and to be defended
by a legal practitioner of his or her choice.
iii. A person who is arrested and detained in custody should be produced
before the nearest magistrate within a period of twenty-four hours. The
travel time is not counted towards the twenty-four hours time frame.
iv. No such person can be detained in custody beyond twenty-four hours
without the authority of a magistrate.

b. The constitutional remedy that is available is that of Writ jurisdiction.

Ans. In fault-based liability, the legal right of the claimant is violated due to a mistake 3+2
39A of the defendant, and the defendant is liable to pay compensation. However,
there are certain situations where the defendant is liable to pay compensation
even if the violation of the claimant’s right is not done by the defendant, but
there is a violation of the claimant’s right. This is known as no fault liability. In
short, liability arising without any fault is a no-fault liability.

It covers two kinds of liability:
• Strict Liability
• Absolute Liability

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The liability of Jal Waterworks Company is Absolute Liability under Tort Law,
even if there is no negligence here by the company, for damaging the property
of Tek Chand in light of the M.C. Mehta Case.

In India, the principle of Absolute Liability was introduced by the Supreme Court
in the aftermath of the two instances of gas leaks from factories killing
thousands and injuring lakhs.

If an enterprise, which is engaged in a hazardous or inherently dangerous
industry, which poses a potential threat to the health and safety of the persons
working in the factory and residing in the surrounding areas owes an absolute
and non-delegable duty to the community to ensure that no harm results to any
one on account of hazardous or inherently dangerous activity in which it is
engaged must be conducted with the highest standards of safety and if any
harm is done on account of such activity, the enterprise must be absolutely
liable to compensate for such harm and it should be no answer to the enterprise
to say that it had taken all reasonable care and that the harm occurred without
any negligence on its part.”

The industry cannot plead that all safety measures were taken care of by them
and that there was no negligence on their part. They will not be allowed any
exceptions neither can they take up any defence like that of ‘Act of God’ or ‘Act
of Stranger’.

The basic principles of absolute liability as emerged above are:
1. Enterprise (commercial objective)
2. Hazardous or inherently dangerous activity
3. Escape is not necessary

Or

39B (I) Negligence is defined as the breach of the duty to take care which results in 2+3
damages. Basically, it can be said that the wrong-doer or the defendant has
been careless in a way that harms the interest of the victim or the claimant.

(II) Yes, Rahul can move the court under Tort of negligence against City Point
Plaza in light of the decided case Donoghue v Stevenson. Here the
negligence on part of the manufacturer of the soft drink resulted in the illness
or injury to the claimant.

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Generally, in order to argue successfully that the defendant has been negligent,
the victim or the claimant must establish three elements against the defendant
in a tort of negligence case

1) the defendant owes a duty of care to the victim;
2) there has been a breach of duty of care on part of the defendant; and
3) the breach of the duty to care resulted in the harm suffered by the claimant.

Let us consider these elements here.

1) Duty of Care
In Donoghue v Stevenson, a case decided in England, the plaintiff Donoghue
drank a soft drink (ginger beer) manufactured by the defendant Stevenson. The
drink had a decomposed snail in the bottle that made the claimant ill.

The court held that the manufacturer owed duty of care to those who are
‘reasonably foreseeable’ to be affected by the product.

CityPoint Plaza, owed a duty of care to its customers like Rahul who came to
the mall.

Thus, the duty of care is owed to those whom one can reasonably foresee as
being potentially harmed. This principle is applicable to numerous fact
situations.

2) Breach of Duty of Care
Once the duty of care is proven the claimant then must establish that the duty
of care was broken; i.e., the defendant was unsuccessful in fulfilling the duty of
care in accordance with the standard of ‘reasonableness’.

In the case of Donoghue v Stevenson, the court held that the manufacturers of
products owe a duty of reasonable care to the consumers who use the
products.

The CityPoint Plaza mall was negligent when an employee mopped the floor
around the fountain but failed to place a "Wet Floor" sign. So there was a
breach of Duty of Care.

3) Harm to the Claimant
In the case of Donoghue v Stevenson, the negligence on part of the
manufacturer of the soft drink resulted in the illness or injury to the claimant.

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Rahul's injury required surgery, physical therapy, and a month-long leave from
work, leading to financial losses and emotional distress. So there was harm to
the claimant, Rahul.

Ans.40 (i) Sole Proprietorship 2.5+
2.5
Sole proprietorship is a popular form of business organisation and is the most
suitable form for small businesses, especially in their initial years of operation.
Sole proprietorship refers to a form of business organisation which is owned,
managed and controlled by an individual who is the recipient of all profits and
bearer of all risks.

The word “sole” implies “only”, and “proprietor” refers to “owner”. Hence, a sole
proprietor is the one who is the only owner of a business.

It is the easiest type of business to establish or take apart, due to a lack of
government regulation.

Ravi could lose his personal savings or assets.

(ii) Limited Liability Partnership (LLP)

A limited liability partnership (LLP) is a body corporate formed and incorporated
under the Limited Liability Partnership Act, 2008. A Limited Liability Partnership
(LLP) is a type of business that combines the benefits of limited liability with the
flexibility of a partnership. It allows members to organize their internal structure
based on an agreement. This type of business is suitable for entrepreneurs,
professionals, and enterprises that provide services or engage in scientific and
technical disciplines. It is also a good option for small enterprises and for
investment by venture capital due to its flexible structure and operation.

Vikram and Ayesha are not personally liable for the company’s debts beyond
the amount they invested.

They would only be liable for the company’s debts up to the amount they have
invested, meaning their personal assets would not be at risk.

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Study Materials
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