All Law Audit Tax
Law 5 marks · 9 min Indian Contract Act: capacity to contract Kunal, aged 17, borrows ₹60,000 from Mr. Desai by signing a promissory note, claiming falsely that he is 19. When Kunal does not repay, Mr. Desai files a suit to recover the loan with interest. Advise Mr. Desai. Law 4 marks · 7.2 min Indian Contract Act: general offer and acceptance Neha announces a reward of ₹10,000 for anyone who returns her lost laptop. Arif finds the laptop and returns it, and only later learns about the reward. Can Arif claim the reward? Law 5 marks · 9 min Indian Contract Act: consideration and privity Mrs. Rao gifts her shop to her son Vivek on the condition, accepted by Vivek in the same deed, that he will pay ₹8,000 a month to his aunt Sunita for life. Vivek stops paying, saying Sunita gave no consideration and is a stranger to the contract. Decide. Law 4 marks · 7.2 min Indian Contract Act: agreements without consideration Out of natural love and affection, Mr. Iyer promises in writing to give his daughter ₹2 lakh on her birthday. The writing is signed but not registered. He later refuses to pay. Is the promise enforceable? Law 4 marks · 7.2 min Indian Contract Act: free consent (coercion) Ramesh threatens to kill himself unless his wife and son sign a release deed giving up their claim to certain land in his favour. They sign. Is the release valid? Law 5 marks · 9 min Sale of Goods Act: caveat emptor and its exceptions Pooja tells a dealer of water purifiers that she needs one that can treat the hard borewell water at her farmhouse, and relies on the dealer’s recommendation. The model sold works only for municipal water and fails within a week. Can Pooja reject the purifier? Law 4 marks · 7.2 min Indian Partnership Act: test of partnership Mohan lends ₹5 lakh to a firm run by Asha and Bharat and, instead of fixed interest, agrees to receive 10% of the yearly profits until the loan is repaid. A creditor of the firm claims Mohan is a partner and liable for the firm’s debts. Decide. Law 4 marks · 7.2 min Companies Act 2013: annual general meeting Zenith Tools Pvt Ltd was incorporated on 10 August 2025 and closes its first financial year on 31 March 2026. By what date must it hold its first AGM, and can the Registrar extend that time? Law 4 marks · 7.2 min Companies Act 2013: private company A private company has 196 members, including 6 current employees who are members. It plans to allot shares to 4 new outside investors and 3 shares held jointly by two brothers. Will it breach the member limit? Audit 5 marks · 9 min SA 580: written representations At the end of the audit of Orion Ltd, management refuses to give a written representation that it has fulfilled its responsibility for preparing the financial statements and has provided all relevant information to the auditor. What should the auditor do? Audit 5 marks · 9 min SA 505: external confirmations The auditor of Crest Ltd wants to send confirmation requests to its five largest debtors. Management refuses, saying the customers will be annoyed. How should the auditor respond? Audit 4 marks · 7.2 min SA 230: ownership of audit documentation After the audit, a director of Nova Pvt Ltd demands that the auditor hand over all working papers, arguing that the company paid for the audit. Is the auditor bound to comply? Audit 5 marks · 9 min SA 570: going concern reporting Delta Airways Ltd has defaulted on loans and depends on a lender agreeing to restructure them. Management has fully disclosed this material uncertainty in the notes and believes the going concern basis is still appropriate. The auditor agrees. How should this be reported? Audit 4 marks · 7.2 min SA 701: key audit matters The auditor of a listed company has qualified the opinion because inventory could not be verified. The engagement partner suggests also describing the inventory issue as a key audit matter "for emphasis". Is this correct? Audit 4 marks · 7.2 min SA 240: responsibility for fraud After a ₹40 lakh embezzlement is discovered at Lotus Ltd, the board says the auditor is primarily responsible for not preventing it. Comment. Audit 5 marks · 9 min SA 299: joint audit P & Co and Q & Co are joint auditors of a bank. They divide branches between them. A fraud is later found in a branch allotted to Q & Co. Is P & Co also responsible? Tax 5 marks · 9 min Residential status (Income-tax Act 1961 numbering) Aditi, an Indian citizen, had been in India for many years. On 15 October she leaves India for a job in Singapore and does not return during the year. She was in India for 197 days that year. Determine her residential status. Would it change if she had stayed only 170 days? Tax 5 marks · 9 min GST: composite and mixed supply A sweet shop sells a Diwali gift box containing sweets, dry fruits, chocolates and a can of aerated drink for a single price. How is it taxed? Would your answer differ for a laptop sold with a carry bag in the same box? Tax 4 marks · 7.2 min GST: place of supply of goods (bill-to ship-to) A manufacturer in Ahmedabad (Gujarat) receives an order from a dealer in Pune (Maharashtra), who asks that the goods be delivered directly to the dealer’s customer in Indore (Madhya Pradesh). What is the place of supply for the manufacturer’s invoice to the Pune dealer, and which tax applies? Tax 5 marks · 9 min GST: reverse charge on legal services Sigma Pvt Ltd (aggregate turnover ₹3 crore last year) pays ₹1,00,000 to an individual advocate for drafting contracts. The finance team proposes to pay the GST on it by using the balance in the electronic credit ledger. Advise.