MODULE -1

MEANING OF LAW

 Law affects every aspect of our lives. It governs our conduct

from cradle to grave and it influences every aspect of our life.
 Law is rules made by an authority for the proper regulation of
the community or society for regulating their conduct.
 Hence is a set of rules laying down rights and obligations
which the state enforces on the individuals and the state.
It is enforced or self imposed to secure justice, peaceful living
and social security. the conduct of people, to protect their
property and contractual rights with a view to securing
justice, peaceful living and social security. The object of
law is order, and the result of order is that men are
enabled to look ahead with some sort of security as to
the future.
The law is not rigid, it is flexible.
Since the value system of society keeps on
changing , the law also keeps changing according
to the changing requirements of the society.
There are several branches of law such as
International law, constitutional law, criminal law,
civil law etc..
Every branch of law regulates and controls a
particular field of activity.
DEFINITIONS BY VARIOUS AUTHORS

 According to Austin- A law is a rule of conduct

imposed and enforced by the sovereign.
 According to Salmond- Law is the body of
principles recognised and applied by the state
in the administration of justice.
 According to holland-Law is the rule of external
human actions enforced by sovereign political
authority.
LAW AND SOCIETY
 Law pervades on every aspect of human life.
Without law there will be choas and confusion in
society.
 Example-traffic rules, cricket games etc.
 Knowlede of law is therefore necessary for all
persons who live in a society.
 Absence of law would lead to uncontrolled
behaviour. law is same and equal for everyone.
 Ignorantia juris non excusat-ignorance of law is no
excuse.every person is presumed to know the law.
 Because ignorance of law is no excuse.
 Ex : 1
If X is caught traveling in a train without ticket,
cannot plead that he was not aware of the rule
regarding the purchase of ticket and therefore, he
may be excused.
 Ex : 2
If Y is caught driving scooter without driving
license, he cannot plead that he was not aware of
the traffic rule regarding the obtaining of a driving
license and therefore, he may be excused.
BUSINESS LAW

 Business law is that branch of law that

comprises laws concerning trade, industry and
commerce.
 Business laws refers to those rules and
regulations which govern the formation and
execution of business transactions made by
various persons in the society.
 Business law is intended to infuse the much
needed certainty in commercial dealings.
 Business law includes laws relating to contract,
sales of goods, negotiable instruments,
partnership, company and many other
economic laws having a bearing on trade,
industry and commerce.
SIGNIFICANCE OF BUSINESS LAW
 Business Law may be defined as that branch of law which prescribes a set
of governance of certain transactions and relations between:
(i) Business persons themselves,
(ii) Business persons and their customers, dealers, suppliers, etc., and
(iii) Business persons and the state.
Significance of Business law:
Law and business are closely related disciplines. They complement each
other.
Law is a major factor in business decision making. Almost every aspect of
business is regulated by law.
Even the installation of a business unit itself may involve observance of
some legal provision or the other.
Sometimes the law may require business to provide certain facilities to its
employees, even when the contract does not provide therefore. For instance,
the provisions of labour welfare laws impose a legal obligation on employers
to provide certain benefits to their workers.
 Business transactions - the buying and selling, production, marketing and
other functions of the business enterprise are to be conducted within a
certain framework of legal environment.
Certain conduct is illegal, and business which commits acts or omissions
declared to be illegal is subject to sanctions.
Regulation of restrictive and unfair business practices
Promotion of conciliation, and arbitration for settlement of business
disputes
Patents, trademarks and copyrights
Import and export regulation
Contracts, sale of goods, guarantee, indemnity, bailment, pledge, charge,
mortgage, partnerships, insurance, carriage of goods
Prevention of food adulteration, regulation of essential commodities
Regulation of stock exchange and financial securities
Regulation and development of industries
Conservation of foreign exchange and prevention of smuggling activities .
Excise, import and export duties, tax on income, wealth
SOURCES OF BUSINESS LAW IN INDIA

1.English Mercantile Law

2.The Statute Law
3.The Common Law (sometimes called as case
law)
4.Customs and Usages
English Law: English laws are the primary sources of Indian
Mercantile Law.
a)English Common Law : This source consists of all those
unwritten legal doctrines embodying customs and traditions
developed over centuries by the English courts. Thus, the
common law is found in the collected cases of the various
courts of law and is sometimes known as ‘case law’.
The common law emphasizes precedents.
b)Equity-It refers to that branch of the English law which was
developed separately from the common law. It is based on the
principle of fairness and concepts of justice developed by the
judges whose decisions became precedents.
c)Law merchant or Maritime Usage-laws are based
on customs and usages of merchants in England. It
is unwritten or non statutory laws. They are found in
reported decisions of the court of law.
d)Statute Law-The statute law refers to the law laid
down in the acts of the parliament. It is superior to
and overrides any rules of the common law, equity or
law merchant. The court of law interpret the meaning
of such enactments and apply them.
The Statute Law: The various Acts passed by the
Indian Legislature are the main sources of
mercantile law in India, e.g. Indian Contract Act,
1872, The Sale of Goods Acts,1930, The
Partnership Act, 1932, The Negotiable
Instruments Act 1881, The Companies Act, 1956.
INTRODUCTION OF INDIAN LEGAL SYSTEM AND
BUSINESS LAW
Judicial decisions or case laws- Judicial decisions are usually
referred to as precedents and are binding on all courts having
jurisdictions lower to that of the court which have gave the
judgement.
This is also called judge made law.
Customs and usages-Customs or usages of a particular trade
also guide the courts in deciding disputes arising out of
mercantile transactions. Such a custom or usage must be
widely known, certain and reasonable and must not b e
opposed to any legislative enactment. But where a statute
specifically provides that the rules of law contained therein are
subject to any well recognized custom or usages of trade, the
latter may override the statute law.
Indian statutes-The constitution of india confers
power to enact law on its parliament and
legislatures of states when a bill is passed by the
parliament/state legislatures and assented to by
the president or governor of a state, it becomes
an Act or statute. The bulk of Indian Mercantile
law is a statute law. The Indian Contract
Act,1872,The Negotiable instruments
Act,1881,The sales of goods Act,1930 are
instances of the statute.
BUSINESS LAW

Knowledge of relevant aspects of law is

necessary for the proper functioning of any
business. Managers may face a variety of
situations that would involve legal issues. A broad
understanding of business law or legal aspects of
business is necessary for managers. Knowledge
of business law enables them to arrive at correct
decisions and this is one of the essential
functions of managers. Thus law is a major factor
in decision making. Therefore it is necessary
that all managers have a working knowledge of
the important business laws and the legal
system. They should understand the basic
judicial structure and provisions of the
constitution of India.