Monday, February 2, 2015



01.  The administrative heads of the departments are responsible for compliance of Official Language Policy of Government of India
02.  MS word is an application software
03.  The locker holder is sick and as such he gives an authority in favor of the minor son to operate the locker and in this case, the bank can allow the minor to operate  the locker
04.  A is a minor and he endorses a cheque in favour of B. In the case of dishonour,  A - cannot be held liable as when a minor endorses a cheque all parties are liable except the minor
05.  You come across a cheque on which neither the words “bearer” nor “order” are written. You will make the payment of this cheque by treating it as an order cheque
06.  Debt Service Coverage Ratio denotes solvency position of the firm
07.  Shroff committee had recommended that companies entering into merger and acquisition transactions, making preferential allotment of shares to related parties and proposing buyback of shares must appoint registered valuer for independent valuation of shares and assets
08.  Debt equity ratio denotes the solvency position of the firm
09.  The accountholder is the drawer of the cheque and in the case of draft, the issuing branch is the drawer
10.  Not negotiable crossing means that the holder in due course will not get the better title
11.  Account opening form is a very important document because it forms the basis of contract between the bank and the customer and it contains the offer of the customer to enter into a contract with the bank
12.  The following are not abound on a negotiable instrument as drawer, acceptor or endorser –a lunatic, an alien enemy and an insolvent
13.  An order cheque is transferable only by endorsement and delivery
14.  The term – “allonge” refers to a plain sheet appended to a negotiable  instrument for the purpose of making endorsement thereon
15.  The following endorsements are invalid – endorsement after maturity of the instrument, partial endorsement, endorsement on a discharged instrument and endorsement in the case of negotiation
16.  “Account Payee” crossing is not mentioned in the Negotiable Instruments Act – 1881
17.  The “protest” is the formal notarial certificate attesting the dishonour of the bill and based upon the noting.
18.  Service Area Approach is a result of recommendation of committees headed by P D Ojha
19.  A person who owns unirrigated land of 3 acres will be classified as a marginal farmer
20.  A foreign traveller encashes travelers’ cheques for $1000 at Rs. 47.25. It is a purchase transaction
21.  A restricted letter of credit is one in which the negotiation is restricted to a specific bank
22.  Red Clause letter of credit is one which authorizes release of preshipment finance to the beneficiary
23.  Limited  company means – limited liability clause in memorandum of association.
24.  Garnishee Order is issued under Rule 46 of Order XXI of the schedule to the code of Civil Procedure  - 1908
25.  A contract of guarantee is defined as – a contract to perform or discharge the liability of the principal debtor in the case of his default
26.  To be a valid acceptance,  the drawee shall affix his signature with or without the words – ‘Accepted”
27.  A Government Company means 51% of the paid up share capital is held by State Government and/or Central Government
28.  If the registrar of DRT refuses to file the suit due to discrepancies in copybook,  the  bank can file the appeal before presiding officer of DRT within 15 days
29.  Lok adalats are constituted under Legal Services Authorities act
30.  Stamp duty earned by the government on demand promissory note goes to the state government
31.  When the bill becomes due for payment – it is the starting point of limitation on a bill of exchange payable at a fixed time after date
32.  Cash Reserve Ratio is maintained by the banks by keeping cash balance with Reserve Bank of India
33.  Nomination facility can be allowed in the following cases – deposit accounts of individuals, articles kept in safe custody and safe deposit lockers
34.  A certificate of deposit is an usance promissory note
35.  Subordinated debt is an element of tier II capital
36.  Accumulated loss will be deducted from tier I capital
37.  Vaghul Committee had recommended the introduction of Certificate of Deposits
38.  The basic nature of a commercial Paper is – it is usance promissory note
39.  “A pass through certificate” called as  PTC can be of the following nature in securitization transactions – with recourse and without recourse
40.  Global depository receipt is listed on Stock Exchange outside USA
41.  Current Ratio denotes liquidity
42.  Simultaneous sale and purchase of a share to take advantage of the variation in prices  in two different markets is called as– Arbitrage
43.  Current Ratio denotes – liquidity
44.  Debt Recovery Tribunals have been created by the Government as a result of the recommendations of Narasimhan Committee
45.  When a bill matures on a public holiday, the maturity date of the bill falls on the next preceding business day
46.  A negotiable  instrument can always be negotiated until it has been paid up or satisfied
47.  In the case of dishonour of a foreign bill, the protest is compulsory when it is required by the law of the place where it is drawn
48.  An engineer is financed for the purchase of a car and the same can be classified as Non priority sector
49.  Under drip irrigation system water is used very economically and supplied drop by drop to the roof zone of crop
50.  “Yellow Revolution” is in connection with growing of fruits especially banana
51.  The economic life of a tractor is  - 10 years
52.  The natural guardian of a married minor girl is her husband
53.  The minimum number of share holders in a Private Limited Company – two members
54.  To open an “Administrator account” the bank requires letter of administration
55.  Karta has the absolute authority to appoint any person as an agent and the agent need not to be a family member
56.  Garnishee Order  is the court order obtained by the judgment creditor attaching funds with Bank of judgment debtor
57.  Indemnity means to make good the loss to the promise/indemnity holder
58.  A bearer who takes a bearer cheque bonafide and for value will be a holder in due course
59.  Mortgage is defined in – Section 58 of transfer of property act – 1882
60.  A banker can exercise the right of set-off only in respect of debts due and determined
61.  Banks are restricted to advance against its own shares – as per Banking Regulation Act 1949
62.  The recovery of dues after issuance of recovery certificate by Presiding Officer of DRT can be made through – Recovery Officer of DRT
63.  The roles of Lok Adalat – to arrive at compromise or settlement; issue final judgment and to give the consented decree
64.  The remedy under Section 138 of Negotiable Instruments Act  is available – when the cheque is presented to paying banker within a period of three months or within the period of its validity whichever is earlier
65.  In case a document travels from higher stamp area to lower stamp area, additional stamps are not required to be affixed
66.  The purpose of maintaining a “documents execution register” is that it is a prima facie evidence of execution of documents
67.  One rupee note bears the signature of the Secretary, Ministry of Finance
68.  Nomination facility is not allowed in the case of joint safe custody accounts
69.  Free capital is a part of tier I capital
70.  Kumar Mangalam Birla is the architect of SEBI’s Corporate Governance Code
71.  Malhotra Committee had suggested to establish an “Insurance Regulatory Authority”
72.  The minimum denomination for a Commercial Paper is Rs.5.00 lakhs
73.  The maximum period for which a certificate of deposit can be issued – not more than 12 months
74.  Capitalisation of reserves leads to issue of bonus shares
75.  1,2,3,4,5,6,7,8,9 – numerals are called as - International form of Indian numerical
76.  Key-board is an input device
77.  MS - DOS is a system software
78.  Dear money policy is meant to control inflation
79.  An illiterate borrower cannot sign acknowledgment of debt but affixes his thumb impression on it. The limitation period will be extended by this action
80.  Section 45 Z of Banking Regulation Act 1949 relates to handing over of original paid cheques to the corporate customer
81.  As per the Prompt Corrective Action scheme, RBI can initiate certain structured actions in respect of the banks which have hit the trigger points in terms of CRAR, Non performing advances and Return on advances
82.  Under Know Your Customer guidelines, the identification and reporting of suspicious transactions are to be done on quarterly basis to Audit Committee of the board of directors
83.  To prevent slippage of accounts to NPA category, RBI has designed broad framework detailing preventive and corrective measures. One of the measures is the introduction of new asset category between “standard” and “sub standard”. This new category is called special mention accounts
84.  While opening accounts of Executors and Trustees to the estate of a deceased person, bank should scrutinize the trust deed, order of charity commissioner and probate
85.  Stamp duty on which of the following documents does not vary from state to state – mortgage agreements, hypothecation agreements, guarantee agreements and bills of exchange.
86.  If no time for payment is specified in a promissory note or bill of exchange, such an instrument is considered as – instrument payable on demand
87.  Acceptance is not required in the case of promissory note and demand bill of exchange
88.  To open an executor account the bank should insist on probate
89.  The following do not fall within the implied powers of a partner under section 19(2) of the Partnership act, 1932 – opening a banking account on behalf of the firm in his own name, compromising or relinquishing any claim or portion of a claim by the firm and withdrawing suit or proceedings filed on behalf of the firm
90.  In a balance sheet, profit is shown under liabilities side
91.  The term – preshipment advances is used to describe advances granted to exporters for the purpose of manufacturing, processing, packaging etc. or simply procuring goods meant for export
92.  In an account of a minor operated by the guardian, after the death of the guardian, the balance cannot be paid to the minor even though he has completed the age of 10 years
93.  On the death of a partner, the firm having credit balance stands dissolved and to wind up the affairs of the firm the surviving partners are allowed to jointly operate the account and if it decides to continue after registering the Municipal Death certificate recording fresh mandate for operation, the existing account can be continued and operation allowed
94.  Opening a banking account on behalf of the firm in his own name, compromising or relinquishing any claim or portion of the claim by the firm, withdrawing suit or processing filed on behalf of the firm do not fall within the implied powers of a partner under Section 19(2) of the Partnership act – 1932.
95.  Garnishee order attaches debts due or accruing due. This means deposits payable on demand and payable at a future date
96.  Parties to a guarantee are principal debtor, surety and creditor
97.  A cheque may be crossed by drawer or holder
98.  The purpose of mortgage is to possess the ownership of other’s property
99.  A banker can set-off the amount held in the time deposit account of a customer against the debit balance of the same customer in overdraft account only after maturity of the fixed deposit
100.          Civil Procedure code provides the provision exemption for arrest in execution of a decree for money under Section 56


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