Legal & Tax Aspect of Business (1)

7/28/2019 Legal & Tax Aspect of Business (1)

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LEGAL & TAX ASPECT OFBUSINESS

LAPLE

BA


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DEFINITION

A Bailment is the delivery of goods by one person t

another for some purpose, upon a contract that they

shall, be returned or otherwise disposed off accordin

the directions of the person delivering them


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ESSENTIALS

Contract

Delivery of goods and change of possession : modedelivery

For specific purpose

Movable goods

Return of specific goods


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KINDS OF BAILMENTS

Gratuitousbailment

Bailment

for reward

Pawn orpledge


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RIGHTS OF BAILOR

Treat bailment as voidable : termination of bailme

Return of goods

Claim compensation for wrongful use of goods by

In case of mixture of goods by bailee

To receive any increase or profit from goods bailed


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DUTIES & LIABILITIES OF THEBAILOR

Put bailee into possession

Disclose faults in goods bailed

Repay necessary expenses

To indemnify gratuitous bailee

Responsibility for any loss due to defect in title

To take back the goods


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RIGHTS OF BAILEE

Particular lien (Sec. 170)

To know faults in the goods bailed to him (Sec. 150

Claim proportionate share in goods mixed (Sec. 15

Claim expenses of bailment (Sec. 158)


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CONTD

Claim losses for defect in title of bailor (Sec. 160)

Gratuitous losses for defect in title of bailor (Sec. 1

Wrongful deprivation of goods Action against thi

person (Sec. 180 & 181)

Enforcement of rights


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DUTIES & LIABILITIES OF ABAILEE

To take reasonable care of the goods bailed (Sec. 1

Unauthorised use of goods bailed (Sec. 154)

Return of goods (Sec. 160 & 161)

To deliver any increase or profit accrued on the go(Sec. 163)

To pay damages

Effect of mixture ofbailors goods with the bailees

(Sec. 155-157)


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RIGHTS OF A PAWNEE

To retain the goods

To recover extra-ordinary expenses

On Pawnors default

Liabilities of a Pawnee are similar to that of a baile


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RIGHTS OF PAWNOR

Right of redemption

Preservation and maintenance

To receive back the goods


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PLEDGEWhat is pledge?

Bailor:pawnor; pledgor

Bailee:pawnee; pledgee

Transaction: pawn

Explain example.


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ESSENTIALS The goods must be delivered as security

Actual or constructive delivery

Movable goods only

Transfer of possession is essential


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PLEDGE BY PERSON OTHER THATHE TRUE OWNER

Pledge by mercantile agent

Pledge by a person in possession of goods

Pledge by a person with limited interest

Pledge by a co-owner in sole possession

Pledge by seller/buyer in possession after sale


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EXAMPLES


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THE TRUSTEES OF THE PORT OF BOMBAY V. THE PREMAUTOMOBILES LTD.AIR 1971 BOM 317

(IMPLIED/INVOLUNTARY BAILMENT)

Facts

Issue :- Whether the liability of the Board was that of a baile

Held in High Court :- negligence on part of Boards employeBoard is responsible for damage caused.

Held in Supreme Court :- The responsibility of the Board waclearly that of a bailee.

Law points :- A bailment may arise, even when the owner ogoods has not consented to the possession by the bailee at sufficient if that possession is within the knowledge of the p

concerned.


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THE MORVI MERCANTILE BANK LTD. AN

ANR. V. UNION OF INDIA1965 AIR 1954

Facts :-

Issue :- Can an owner of goods make a valid pledge of themtransferring the railway receipt representing the said goods?What value such a document carry for this purpose?

Held in High Court :- Allowed the appeal and decreed the clfor Rs. 20,000 on the ground that as pledgee of the goods.

Held in Supreme Court :- The endorsement of the railway rein favour of the Bank did not constitute a pledge of the goodcovered by the receipt.


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THANK YOU

Sumit Agrawal

Yashashree Chaudhary

Pradeep Dayani

Pradeep DesmukhShrushti Dubal

Simi Gangeria

Mayur Gidwani

Pawan Golani

Bhagyashree Gupta

Legal & Tax Aspect of Business (1)

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