1. LEGAL ASPECTS OF BANKING OPERATIONS JAIIB MODULE C & D 06.11.06

2. 01..Under SARFAESI Act, 2002, the word Board is used to mean A.. Reserve Bank of India B.. Securities and Exchange Board of India C.. Debt Recovery Tribunal D.. Securitization Company

3. 02..Which pair is not correct A. Obligor – Borrower B. Lender - Originator C. Sponsor – Reserve Bank of India D. Secured Financial Institution Creditor -

4. 03..This evidences the purchaser’s undivided right, title and interest in the security. A. Ownership B. Transfer Right C. Right to possess and enjoy D. None of these

5. 04..Which one cannot be a Qualified Institutional Buyer A. Insurance company B. Bank C. A Partnership firm with financial experience D. A Foreign Institutional investor

6. 05.. Which statement is correct A. An asset reconstruction company need not be registered under Companies Act. B. A foreign institutional investor to be registered with RBI C. SARFAESI Act not applicable to RRBs D. Securitization Company has also to be registered with SEBI.

7. 06..Securitisation companies can set up separate trusts scheme wise and act as trustee for such schemes. The beneficiaries of such trusts are A. Trustees B. Borrowers C. Creditors D. None of them

8. 07..The Securitisation company or reconstruction company can acquire financial asset of any bank or financial institution by issuing A. Debenture B. Bond C. Any other security D. Any one of the above

9. 08..Identify the odd one (Debenture) A.A debenture for payment of consideration to be paid to the bank for acquisition of financial asset from it B.The rate of interest on debenture cannot be more than 1.5% above Bank rate C.Redemption period not beyond 6 years. D.Reconstruction company to issue debenture

10. 09..It has the owned funds not less than Rs.2 crore or such other amount not exceeding 15 % of total financial assets acquired or to be acquired as the RBI may specify. A. Securitisation Company B. Reconstruction Company C. Both a & b D. None of these

11. 10..The securitisation company or the reconstruction company can acquire financial asset of any bank or financial institution A. True B. False C. Incorrect D. Not True

12. 11.. Identify the correct one. A.Acquisition of funded assets to include take over of outstanding commitments, if any, of any bank, to lend further. B.If registration cancelled, Reconstruction company can appeal within 45 days C.Security receipt is in favour of investors D.Scheme wise/ asset –wise separate accounts not required to be maintained

13. 12.. A securitisation company or reconstruction company can raise funds by way of deposits. A. Not False B.. Not True C.. Not applicable to Securitization company but to Reconstruction company D.. Not applicable to Reconstruction company but to Securitisation company

14. 13..Identify the incorrect one (Securitisation) A. Non performing asset is linked to overdue period which is 90 days now B.If the asset is taken for reconstruction limit is 7 years for reconstruction C.Capital Adequacy of 15% to be there D.While issuing security receipts necessary disclosures to be made without fail

15. 14..The date agreed upon by the secured creditors representing not less than three- fourth in value of the amount outstanding on such date. A. Agreement Date B.. Agreed Date C.. Record Date D.. Due date

16. 15.. Which one is not coming under Securitisation. A. Hypothecation of Stock B. Assignment of Book Debts C. Mortgage of Land D. Pledge of Goods

17. 16..In case of sale of immovable property the borrower should be given notice about the sale before A. 60 days B. 2 months C. 90 days D. None of these

18. 17.. An authorized officer has finalised the sale of property for Rs. 10 lacs. Then the purchaser has to remit A. The amount immediately B. Within 15 days C. 25% of the offer price D. Nothing at once

19. 18.. The authorized officer can A. Accept the Offer B. Confirm the sale C. Issue Sale Certificate D. Perform all the above

20. 19.. Securitisation (identify the odd one) A. For taking possession and then sell the immovable property (under mortgage) court permission required. B. Court permission not required C. The authorised officer to publish the possession notice D. In two leading newspapers

21. 20..An appeal to the Appellate Tribunal is to be preferred within A.One month from the date of receipt of the order of Debts Recovery Tribunal. B.30 days C.60 days D.None of these

22. 21.. A record to be maintained at the Central Registrar at their head office to record transactions relating to A. Securitization of financial assets B. Reconstruction of financial assets C. Creation of security interests D. All the above

23. 22.. When any security interest is registered with the Central Registrar is modified, the same is required to be filed before Central Registrar within A. 30 days B. One month C. 45 days D. 60 days

24. 23.. If a reconstruction company fails to comply with any of the directions of RBI then the company is punishable with fine not exceeding A. Rs.1 lac for the default. B. Rs. 5000/- per day C. Rs 10000/- per day D. Rs. 5 lacs

25. 24..Provisions of SARFAESI ACT not applicable for A. A pledge of movable assets B. Hire purchase or lease in which no security interest has been created C. Any security interest created in agricultural land D. All the above

26. 25..A bank has realized part of the liability by using Securitisation procedure. The balance outstanding is Rs.12 lacs without any tangible security. A. Bank will have to forego B. Bank can approach DRT C. Bank cannot approach any court D. Bank will have to write off

27. 26.. After recovery through Securitisation process for balance outstanding to recover the bank can approach competent court provided A. Limitation period is not over B. Debt is time barred C. Limitation period has not been extended D. Borrower agrees

28. 27..Banking Ombudsman review authority is A.Ombudsman himself B.Awarding Official C.RBI Executive Director D.None of them

29. 28..Banking Ombudsman which is incorrect A. Provided with a Secretariat B. Cost of Secretariat to be borne by RBI C. Remuneration to be decided by RBI D. He can not act as an arbitrator

30. 29.Banking ombudsman- identify odd one A. Non- adherence of prescribed working hours by branches B. Observance of RBI directives on interest rates C. Failure to pay guarantee amount D. Non- issue of drafts to non customers

31. 30..Banking Ombudsman as an arbitrator to follow the scheme as well as the provisions of A. Banking Regulation Act B. Reserve Bank of India Act C. Arbitration Act D. None of these

32. 31..DRT Act not applicable to A. Nationalized Banks B. Regional Rural Banks C. State Bank of India D. None of these

33. 32..Under DRT Act, a Recovery Officer is one who is A. Appointed by the respective Banks B. Also known as Authorized Officer C. Appointed by the Central Government D. Also called Presiding Officer

34. 33..Which one is incorrect (DRT) A. An application for execution of the decree of foreign court cannot be entertained by Debt Recovery Tribunal. B.The Limitation Act applies for DRT cases C.Other Bank can join the application. D.Tribunal to deal with cases above Rs,10 lacs

35. 34..Identify the correct mode of recovery of debts (DRT) A. Attachment and sale of movable property B. Sale of immovable property of the defendant C.Arrest of the defendant and his detention in prison D.Any one of the above

36. 35.. The recovery certificate which has been issued requires rectification of arithmetical mistake. It can be done by A. The Banker himself B. The Competent Court C. The Officer of the DRT D. None of these persons

37. 36..Any person aggrieved by the order of Recovery Officer may appeal to the Tribunal within A. 15 days B. 30 days C. 30 days from the date of the order D. 30 days from the date of receipt of the copy of the order.

38. 37..According to Bankers’ Books Evidence Act identify the correct one. A.. The Act extends to the whole of India including the State of Jammu & Kashmir B.For a Computer Print out certificate by the Principal Accountant is not acceptable C.The certified copy need not have any declaration. D. The Act is not applicable to the State of Jammu & Kashmir

39. 38..For inspection of books by order of court the same has to be served on the bank A. Any time before banking business hours B. Any of its branches C. At least a week before the same is to be obeyed D. None of these

40. 39...A dispute where the person against whom complaint has been made, denies or disputes the allegations contained in the complaint refers to A. Consumer Dispute B. Customer Dissatisfaction C. Consumer Complaint D. Deficiency in Customer Service

41. 40..Under the Consumer Protection Act, who is not treated as a “Person” A. An unregistered Firm B. A Registered Firm C. A Co-operative Society D. None of the above

42. 41..J applied for a loan which the bank considered. However J went to the consumer forum claiming that the loan was inadequate. Then the consumer forum A. Can direct the bank to give balance loan B. Cannot direct the bank C. Can entertain the consumer’s request D. None of these

43. 42..Which one is correct A.. The State Consumer Protection Council to meet at least two times every year. B.. The District Consumer Protection Council to meet at least one time every year. C.. The Central Consumer Protection Council to meet at least two times in a year. D..The highest council is the National Council

44. 43..Identify the odd one (Consumer Disputes Redressal Agencies) A. National Commission B. District Forum C. Central Council D. State Commission

45. 44..Every member of the District Forum to hold office for a term of three years or up to the age of sixty-five years, whichever is earlier. A. True B. False C. Partially True D. It is not 3 years but 5 years

46. 45..An appeal against the District Forum’s order has to be filed before State Commission within 30 days. In case of monetary involvement the person filing appeal A.. Need not remit any amount B.. Has to remit 50 % of the amount ordered C.. Rs.20,000 D.. B & C which ever is less

47. 46..For filing any complaint before a District Forum, State Commission or the National Commission the limitation period from the date of cause of action is A.. 1 year B.. 2 years C.. 3 years D.. No limitation period

48. 47..An Agreement involving 3 persons is called A.. Unilateral Agreement B.. Bilateral Agreement C.. Multi person Agreement D.. None of these

49. 48.. It is the delivery of goods by one person to another for some purpose. When the purpose is accomplished, the goods are to be returned or otherwise disposed of according to the direction of the person delivering them. A. Hypothecation B. Bailment C. Assignment D. Mortgage

50. 49.. Under Pledge the pledgee is the A. Debtor B. Creditor C. Borrower D. None of them

51. 50..Termination of Agency is possible A. Principal revoking his authority B. Agent dies during the agency period C. Principal is adjudicated as insolvent D. All the above

52. 51.. Which one does not pertain to sale A. The risk in goods is with the buyer B. The Seller can only sue for damages C. It is a contract in which the parties have already performed their part D. The ownership of goods have already passed irrespective of whether the goods are delivered or not

53. 52..It is a stipulation collateral to the main purpose of the contract. The breach of such a stipulation gives rise to a claim for damages only. A. Condition B. Warranty C. Guarantee D. Stipulation

54. 53.. The unpaid seller (which one is not the Right) A. Right not to withhold delivery of goods B. Right of re-sale C. A lien on the goods for the price while he is in possession of them D. Right to stop goods in transit

55. 54.. This type of partnership can be dissolved by any partner by giving notice in writing to all the other partners of his intention to dissolve the firm. A. Ordinary Partnership B. Partnership at Will C. Special Partnership D. Particular Partnership

56. 55..The implied authority of a partner does not empower him to A. Open a banking account on behalf of the firm in his own name B. Withdraw a suit filed on behalf of the firm C. Admit any liability in a suit against him D. Enter into partnership on behalf of the firm

57. 56.. A minor who was admitted to receive the benefits of a firm, on attaining majority and becoming a partner A.His rights and liabilities as a minor continue upto the date on which he becomes a partner B.He is personally liable to 3 rd parties for all the acts of the firm done C.Since he was admitted to the benefits of the firm D.All the above are applicable

58. 57..Which one is incorrect A. Registration of a firm is optional B. Registration of a company is not compulsory C. A firm does not have a perpetual existence D. Common seal is not applicable to a firm

59. 58.. Identify the odd one (Companies) A. A private company can accept deposits only from its members or directors B. For Private company minimum issued capital has to be Rs.1.oo lac C. Minimum 3 directors required for Public Ltd company D. Memorandum of Association is a Public document

60. 59..Which does not require registration? A. Pledge of company assets B. Prospectus C. Book Debts D. Any share in a ship

61. 60..Who is an authorised person under FEMA A. Any bank B. Authorized Money Changer C. Authorised Dealer D. All the above

62. 61.. The mortgagor agrees that in the event of his failing to pay according to his contract, the mortgagee has the right to sell the mortgaged property and recover his dues. Identify the mortgage A. Simple B. Usufructuary C. Conditional Sale D. English

63. 62..On payment of the money the mortgagee will re transfer the property to the mortgagor. Which is that mortgage A.Equitable B.Simple C.English D.Conditional Sale

64. 63..Which statement is true A. Simple Mortgage has to be created in a Notified Area B. English Mortgage Private Sale is not there C. Equitable Mortgage Registration is not applicable D. Simple Mortgage Deed to be registered within 30 days of execution

65. ALL THE BEST THANKS T.M.C. VASUDEVAN (M) 9819500380 ® 022-27606208 EMAIL vasu1611@yahoo.co.in