CS Executive December 2024 Question Paper Setting Up of Business, Industrial and Labour Laws

FOR CS EXECUTIVE EXAM PREPARATION

CS Executive 2024
Question Paper · Setting
Up of Business,
Industrial and Labour
Laws
EXAM YEAR TYPE

CS Executive 2024 Question Paper
SUBJECT DATE

Setting Up of Business, Industrial and Labour Laws December 2024

Notes · Sample Papers · Previous Year Papers · Mock Tests

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NEW SYLLABUS
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Roll No. ..................................... : 1 :

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Time allowed : 3 hours Maximum marks : 100

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Total number of questions : 6 Total number of printed pages : 12
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Answer ALL questions.

PART–I

1. XYZ Appliances Pvt. Ltd. is carrying on the business of manufacturing and trading of kitchen

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appliances at Sadar Bazar, Delhi. X, Y and Z are the three directors of the company who

e m its branches in the cities of Noida, Gurgaon and
also hold shares of the company in the ratio of 35 : 35 : 30. The business of the company

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is flourishing and the company has opened
Faridabad.

In order to protect their personal interests, X, Y and Z propose that any amendment in
the Articles of Association of the company should be made only with the approval of all
the shareholders of the company. They approach M, a practicing company secretary to seek
his advice on the alteration of Articles of Association of the company only with the approval
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c. o XYZ Appliances Pvt. Ltd. receives an export order from a company
of all the shareholders. M advises them suitably.

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a Code (IEC). The directors
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aprocedure to apply for IEC on
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order to export the goods, the company requires Importer Exporter

a of the company again approach M who explains them the
the DGFT portal. After getting the IEC in the name of the company, the export order is
successfully completed by the company.

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A company based at Japan approaches XYZ Appliances Pvt. Ltd. to form an alliance for
sharing of latest technical advancements in the industry for mutual benefit of both the companies.
The directors of XYZ Appliances Pvt. Ltd. discuss on the objectives of the foreign collaboration.
Thereafter, a technical collaboration is made between both the companies.

The scale of operations of XYZ Appliances Pvt. Ltd. increases multifold and the directors
intend to convert it into a public limited company. With the professional assistance of M,
the company is converted into a public limited company. M also advises on the post conversion
requirements to be arranged by XYZ Appliances Ltd.

Y goes on a business trip to Singapore and meets his friend John, who is a director in
a company based at Singapore in the name of JSS Realtech Pte. Ltd. JSS Realtech Pte.
Ltd. is engaged in the development of townships, construction of residential or commercial
premises, roads or bridges for selling or leasing. John advises Y that the company, XYZ
Appliances Ltd. may invest in JSS Realtech Pte. Ltd. to earn more profits. On return, Y
informs X and Z that XYZ Appliances Ltd. may invest in JSS Realtech Pte. Ltd., engaged
in real estate activity at Singapore. However, Z is of the view that the Overseas Direct
Investment (ODI) in a foreign entity engaged in real estate activity is prohibited.

In view of the above, answer the following :

(a) What is the advice of M to X, Y and Z on their proposal regarding alteration of
Articles of Association of XYZ Appliances Pvt. Ltd. only with the approval of all
the shareholders ?

(3 marks)

(b) What is the process to apply for Importer Exporter Code (IEC) on the DGFT portal
as advised by M to the directors of XYZ Appliances Pvt. Ltd. ?

(3 marks)

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(c) What are the objectives of the foreign collaboration as discussed by the directors

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of XYZ Appliances Pvt. Ltd. ?

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e are the post conversion requirements to be arranged by XYZ Appliances a
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(3 marks)

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(d) What
a after conversion from a private limited company to a public limited company ?

(3 marks)

(e) Is the view of Z regarding the Overseas Direct Investment (ODI) by XYZ Appliances
Ltd. in JSS Realtech Pte. Ltd. correct ?

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(3 marks)

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m successfully under separate state cooperative
2. (a) ABC Group is a combination of dairy farmers operating in two States, Maharashtra

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as
societies for several years.glHowever, due to growing demand for their products and
and Gujarat. They have been operating

a
the need to streamline operations across state boundaries, the group is considering
the formation of a Multi-State Cooperative Society (MSCS) under the Multi-State
Cooperative Societies Act, 2002.

What are the legal and procedural steps involved in registering a Multi-State

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Cooperative Society under the Multi-State Cooperative Societies Act, 2002 ?

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Resilience Asset Reconstruction Company (RARC) emerged in response to the growing

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crisis of non-performing assets (NPAs) in the Indian banking sector by offering innovative
solutions for asset recovery and management.

How does RARC contribute to improving the financial health of banks ?

(3 marks)

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(c) MNC LLP, a consulting firm, faced serious allegations of financial misconduct involving
a senior partner, Kumar, who was accused of falsifying financial reports. Employees
felt unsafe reporting these concerns internally until Priya, a junior consultant, decided
to blow the whistle. She submitted a formal complaint along with evidence to the
Whistleblower Committee, citing Section 31(1) of the Limited Liability Partnership Act,
which protects whistleblowers from retaliation.

What are the protections provided to Priya for reporting misconduct under Section
31(1) of the LLP Act, 2008 ?

(3 marks)

(d) GreenTech Innovations is a micro enterprise founded in 2020 by Raj, an engineering
graduate with a passion for renewable energy. Based in a small town, the company
specializes in manufacturing solar-powered lamps aimed at rural areas that lack reliable
access to electricity. Raj’s vision is to provide affordable, sustainable lighting solutions
that improve the quality of life in these communities.

Explain the role of Micro, Small, and Medium Enterprises (MSMEs) like GreenTech
Innovations in economic development and community empowerment.

(3 marks)

(e) Global Tech Solutions, a prominent software development company headquartered in
the United States, has successfully established its initial branch office in Bengaluru.
Following the success of this office, the company has identified the need to establish
an additional branch office in Hyderabad to further expand its market presence and
enhance service delivery.

What are the critical steps and activities involved in establishing an additional branch
office in India for foreign entities like Global Tech Solutions ?

(3 marks)

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3. (a) Anil wants to incorporate a company in the name ‘National Electricity Corporation

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Limited’. However, the application was rejected with the reason that the name is

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e objects to this rejection. l a
identical to the name of an existing company i.e., ‘Rashtriya Vidyut Nigam Limited’.

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Anil

a Referring to the provisions of Rule 8 of the Companies (Incorporation) Rules, 2014,
examine the validity of objection of Anil.

(3 marks)

(b) The Green Future Trust operates transparently and focuses on charitable purposes,

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adhering to legal requirements for trusts in India. According to the Indian Trust Act,

1882, what are the constituents of. The Green Future Trust ?
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(3 marks)

(c) Chitra Chit Fund Company, established in 2015, operates in a small town in India,

providing a platform for local residents to save and borrow money through a traditional

chit fund system. With a growing customer base, the company aims to expand its

operations while ensuring compliance with regulatory requirements.

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What are the restrictions imposed by the RBI on chit fund companies like Chitra

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Chit Fund Company ?

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(3 marks)

ag (d) QuickTech Solutions, a small software development company based in Pune, specializes

in creating customized software applications for businesses across India. Initially, the

company operated under the composition scheme due to its modest revenue. However,

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in the financial year 2022-23, QuickTech’s turnover surpassed ` 30 lakh, and it began

offering services to clients in other states.

What are the implications of Section 24 of the CGST Act, 2017, for QuickTech

Solutions in terms of compulsory GST registration ?

(3 marks)

(e) BrightFuture Foundation wants to apply for section 8 company license while engaging

in commercial activities, such as offering paid online courses, to fund its charitable

activities. How would these commercial activities align with the eligibility criteria

for a section 8 company, which focuses on promoting charitable objectives over

profit-making ventures ?

(3 marks)

Attempt all parts of either Q. No. 4 or Q. No. 4A

4. (a) Differentiate between an Equity based Joint Venture and a Contractual Joint Venture.

(b) Explain the concept of Life Cycle of Start-up.

(c) ‘Contracts lie at the crux of running any business’. Elucidate.

(d) Prepare a note on ‘Infrastructure Debt Fund : Non-Banking Financial Company

(IDF-NBFC)’

(e) What are the benefits of incorporating a Nidhi Company ?

(3 marks each)

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OR (Alternate question to Q. No. 4)

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me affects the choice of form of organization’. Explain l a s
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4A. (i) ‘The degree of control and management that an entrepreneur desires to have over

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business

Which are the technological aspects that should be considered before choosing a business
location outside India ?

(iii) State the method of calculating Net Owned Funds as per RBI definition for obtaining
NBFC license.

(iv)
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Differentiate between Partnership Agreement and Trust Deed.

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. Business ?
(v)
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What is meant by Joint Hindu Family

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a PART–II
(3 marks each)

5. Hindustan Power Supply Ltd. (HPSL) is a wholly owned Government Company. The company
employed a diverse workforce, including both full-time employees and contractual workers,
who played important roles in the company’s success. However, as the company expanded,

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disparities in pay and benefits between these two groups began to surface.

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Rajesh, holds a degree in Electrical Engineering (BE) from UGC recognized university having

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a for over a decade. As an
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full-time employees and had been a key contributor to HPSL
Assistant Engineer, he worked on numerous high-profile power generation and transmission
projects, often collaborating closely with full-time employees. Despite his contributions being
at par with those of his full-time colleagues, Rajesh’s compensation remained significantly lower.

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He also lacked the job security and benefits, such as health insurance and paid leave, that

were provided to full-time employees.

Over the years, the disparity between Rajesh's compensation and that of his full-time counterparts,

like Meera, a full-time Executive Engineer, who joined the company around the same time

as Rajesh, enjoying higher pay, benefits, and job security became more pronounced. Meera,

who had great respect for Rajesh’s skills and work ethic, was aware of the inequity but

felt uncertain about how to address it within the corporate structure. Meanwhile, Rajesh's

growing frustration began to affect his motivation and sense of loyalty to the company.

One evening, after discussing his situation with a friend, Rajesh was introduced to Anjali,

a renowned Advocate in service matters and employee related issues. Rajesh shared his concerns

with Anjali, who informed him about a significant legal precedent in India– ‘Dhirendra Chamoli

Vs. State of U.P.’, whereas Hon’ble Apex Court passed the doctrine of equal pay for equal

work. Anjali also referenced the recent judgement of Hon’ble Supreme Court in the matter

of State of Punjab & Ors. vs Jagjit Singh & Ors., in which the Court primarily addressed

the regularization of temporary employees and strongly affirmed the principle of “equal pay

for equal work.” According to this principle, Rajesh, who was performing the same duties
as full-time employees, was entitled to equal compensation, regardless of his contractual status.

Empowered by this information, Rajesh decided to take action. With Anjali’s guidance, he

and several other contractual workers in the company submitted a formal grievance to Patel,

the Chief General Manager, Human Resources of the company. The grievance outlined their

concerns about the pay disparity and referenced the various judgements of Supreme Court,

requesting the company to review its compensation practices to ensure fairness.

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Patel, a seasoned HR professional with a strong commitment to ethical business practices,

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took the grievance seriously. He initiated a comprehensive review of the company’s compensation

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e Court with respect to ‘Equal pay for Equal work’ in the corporate gcontext.
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policies and consulted with legal experts to understand the implications of the judgements

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of Supreme

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Recognizing that maintaining the current pay disparity was both legally risky and ethically

questionable, Patel decided to take corrective action.

Over the next few weeks, Patel led the development of a new compensation policy in the

company. The policy introduced a standardized pay scale for all employees, ensuring that

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those performing similar roles received equal pay, irrespective of their employment status.

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This change was communicated transparently across the company, with efforts made to address

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any concerns and ensure a smooth transition.

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under Atal Beemit Vyakti Kalyan Yojna (ABVKY).

The implementation of the new pay structure had a positive impact on the company’s workforce.

Contractual workers, who had long felt undervalued, now experienced a renewed sense of

commitment and motivation. Rajesh, in particular, felt a deep sense of satisfaction and loyalty
towards the Company, knowing that his contributions were finally being recognized and rewarded

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fairly. Meera and other full-time employees also welcomed the change, appreciating the company’s

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g a disparity but also set a
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a precedent for other companies in the industry. The company’s

the issue enhanced employee morale, reduced employee turnover, and reinforced its reputation

as a fair and progressive employer.

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In view of the above, answer the following :

(a) Define the term ‘Equal Pay for Equal Work’ in the light of Constitutional provisions.

(b) In the above situation, if some workers, who are on contractual employment, do not
get the regular employment and retrenched by the company, how will they be facilitated
under Atal Beemit Vyakti Kalyan Yojna ?

(c) Discuss the prohibition of employment of contract Labour.

(d) Rajesh and other contractual workers decided to go on strike. However, the company
is in public utility service. Describe the prohibition of strikes and lock-outs in public
utility service.

(5 marks each)

Attempt all parts of either Q. No. 6 or Q. No. 6A

6. (a) ABC Healthcare is a well-established hospital with a workforce of 100 female employees.
One of the nurses, Priya, is expecting her first child and is preparing to take maternity
leave. Priya is not aware of her right to payment of maternity benefits and she is
unsure about the procedure for claiming these benefits and the necessary notice she
needs to provide to her employer.

Advise Priya on her right to payment of maternity benefits and on the requirements
for the notice of claim for maternity benefit under Section 6 of the Maternity Benefit
Act, 1961.

(5 marks)

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(b) Techno Soft Solutions, a software development company, has been in operation for

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over a decade and has a workforce of 150 employees. Recently, one of the senior
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software engineers, Rajesh, decided to resign after completing 5 years of service with

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the company. He is inquiring about his entitlement to gratuity under the Payment of

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l Under what circumstances and to whom is the gratuity payable under theaPayment
Gratuity Act, 1972.

a
of Gratuity Act, 1972 ?
(5 marks)
(c) Bright Futures Ltd., is imparting education to the students. It has been facing financial
difficulties and has delayed salary payments and other dues to its employees for the
past three months. Several employees have resigned due to the non-payment of wages,
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while those remaining are increasingly concerned about their financial stability. The affected

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employees have approached the company management several times, but no concrete

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measures have been taken to resolve the issue. Consequently, the employees have

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decided to take legal action to recover the amounts due to them under the Payment
of Wages Act, 1936.
Explain the measures to be taken by the employees for recovery of amount due
from the employer.
(5 marks)
(d) QualityTech Industries, based in Hyderabad, is a prominent manufacturer of electronic

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components. To meet its production needs, the company has employed a significant

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number of contract workers in various roles, including assembly and quality control.

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In 2023, a Labour Inspector conducted a routine inspection of QualityTech Industries

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to assess compliance with the provisions of the Contract Labour (Regulation and

gla Abolition) Act, 1970.

a Describe the powers of Inspector under section 28 of the Contract Labour (Regulation
and Abolition) Act, 1970.

(5 marks)

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OR (Alternate question to Q. No. 6)

6A. (i) Discuss the implications of Section 14 of the Sexual Harassment of Women at Workplace
(Prevention, Prohibition and Redressal) Act, 2013, regarding punishment for false or
malicious complaints.

(ii) Explain the provisions for novation of contracts of apprenticeship under Section 5
of the Apprenticeship Act, 1961.

(iii) What are the stipulations regarding the payment of minimum bonus and maximum bonus
under the Payment of Bonus Act, 1965 ?

(iv) Enumerate the matters that need to be provided in Standing Orders under the Industrial
Employment (Standing Orders) Act, 1946.

(5 marks each)

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