Description
Legal Aspect of Business
NMIMS Internal Assignment
June 2025 Examination
Question 1 A startup named “SunDisk Pvt. Ltd.” specialises in software development. Initially, its Memorandum of Association (MOA) focused solely on developing enterprise software solutions. However, when market patterns changed, the business recognized profitable prospects in cloud computing services and artificial intelligence (AI) consulting. The board of directors decided to enter these segments without modifying the MOA. Soon after, a major investor raised concerns that these activities were ultra vires and could lead to legal consequences. The company now faces challenges related to business expansion, legal compliance, and shareholder confidence.
Based on the given scenario, highlight the challenges before SunDisk Pvt. Ltd. if the MOA continues to remain unamended. Please explain the challenge by emphasizing the doctrine of ultra vires under the Companies Act, 2013, and suggest potential solutions to avoid the company violating the provisions of Companies Act, 2013
(10 Marks)
Question 2 (A) Innovative Constructions Pvt. Ltd. signs a contract with the government to build a highway in two years. The contract includes terms about work deadlines and quality. However, the company faces three major problems:
Delay in Work: Due to supply chain problems, only 90% of the work is done on time. The government may take legal action for not completing the project.
Change in Contract: The company asks for extra time, and the government agrees, but some contract terms need to be changed.
Work Becomes Impossible: A new law bans an important material needed for the project. The company claims that the contract should end because completing the work is now impossible.
Question: Under the Indian Contract Act, 1872, explain how the company should handle these problems legally. Consider rules about performance (finishing the work), changing terms of the contracts by mutual agreement, and what happens when the work becomes impossible to perform. Mention relevant legal sections where
applicable.
(5 Marks)
Question 2 (B) Harish, a real estate developer, signs a contract with Mehta & Sons to build a luxury apartment complex in two years. The contract states that if the project is delayed,
Mehta & Sons must pay a penalty (liquidated damages). However, due to poor management, they fail to complete the project on time. Harish suffers financial loss and damage to his reputation.
Question:
Under the Indian Contract Act, 1872, what legal remedies does Harish have for this contract breach? What steps can he take to prevent further delays? Mention relevant legal sections.
(5 Marks)
Assignment Marks: 20
