"The Indian Partnership Act, 1932"

   

                      The Indian Partnership Act, 1932 is an act enacted by the Parliament of India to regulate partnership firms in India. It received the assent of the Governor-General on 8 April 1932 and came into force on 1 October 1932. Before the enactment of this act, partnerships were governed by the provisions of the Indian Contract Act. The act is administered through the Ministry of Corporate Affairs. The act is not applicable to Limited Liability Partnerships, since they are governed by the Limited liability Partnership Act, 2008.

 Definition :-                

                 Section 2 of the act defines,

(a) an "Act of a firm" means any act or omission by all the partners, or by any partner or agent of the firm which gives rise to a right enforceable by or against the firm;

(b) "Business" includes every trade, occupation and profession;

(c) "Prescribed" means prescribed by rules made under this Act; (c-1) "Registrar" means the Registrar of Firms appointed under sub-section (1) of section 57 and includes the Deputy Registrar of Firms and Assistant Registrar of Firms appointed under sub-section (2) of that section;

(d) "Third party" used in relation to a firm or to a partner therein means any person who is not a partner in the firm; and

(e) Expressions used but not defined in this Act and defined in the Indian Contract Act, 1872, shall have the meanings assigned to them in that Act.

Partnership refers to an agreement between persons to share their profits or losses arising on account of actions carried by all or one of them acting on behalf of all. The persons who have entered such an agreement are called partners and give their collective business a name, which is necessarily their firm-name. This relation between partners arises out of a contract or an agreement, which means a husband and wife carrying on a business or members of a Hindu undivided family re not into partnership. The share of profits received by any individual from the firm, money received by a lender of money, salary received by a worker or a servant, annuity received by a widow or a child of a deceased partner, does not make them a partner of the firm.

"The Indian Contract Act 1872"

                     The law relating to contracts in India is contained in Indian Contract Act, 1872. The Act was passed by British India and is based on the principles of English Common Law. It is applicable to the All States of India except the State of Jammu & Kashmir. It determines the circumstances in which promise made by the parties to a contract shall be legally binding on them. All of us enter into a number of contracts everyday knowingly or unknowingly. Each contract creates some right and duties upon the contracting parties. Indian contract deals with the

enforcement of these rights and duties upon the parties in India.

Definition :- 

                    Section 2(h) of the Act defines the term contract as "any agreement enforceable by law". There are two essentials of this act, agreement and enforce ability.

Section 2(e) defines agreement as "every promise and every set of promises, forming the consideration for each other."

Again Section 2(b) defines promise in these words: "when the person to whom the proposal is made signifies his assent there to, the proposal is said to be accepted. Proposal when accepted, becomes a promise."

And other words Say Agreement is Sum of

all contract are agreement, but all agreement are not contract..

                              CONTRACT=AGREEMENT+ENFORCEABLE BY LAW( LAW)                      

                 The Indian Contract Act came into force on 1 September 1872. It Was Enacted Mainly With a View To ensure Reasonable Fulfillment of Expectation Created By the promises of the parties and also enforcement of obligations prescribed by an agreement between the parties.The Third Law commission of British India formed in 1861 under the stewardship of chairman Sir John Romilly, with initial members as Sir Edward Ryan, R. Lowe, J.M. Macleod, Sir W. Erle (succeeded by Sir. W.M. James) and Justice Wills (succeeded by J. Henderson), had presented the report on contract law for India as Draft Contract Law (1866). The Draft Law was enacted as The Act 9 of 1872 on 25 April 1872 and the Indian Contract Act, 1872 came into force with effect from 1 September 1872.

Before the enactment of the Indian Contract Act, 1872, there was no codified law for contract in India. In the Presidency Towns of Madras, Bombay and Calcutta law relating to contract was dealt with the Charter granted in 1726 by King George I to the East India Company. Thereafter in 1781, in the Presidency Towns, Act of Settlement passed by the British Government came into force. Act of Settlement required the Supreme Court of India that questions of inheritance and succession and all matters of contract and dealing between party and party should be determined in case of Hindu as per Hindu law and in case of Muslim as per Muslim law and when parties to a suit belonged to different persuasions, then the law of the defendant was to apply. In outside Presidency Towns matters with regard to contract was mainly dealt with English Contract Laws; the principle of justice, equity and good conscience was followed.

"The Companies Act, 1956"

                   The Companies Act 1956 is an Act of the Parliament of India, enacted in 1956, which enabled companies to be formed by registration, and set out the responsibilities of companies, their directors and secretaries. The Companies Act 1956 is administered by the Government of India through the Ministry of Corporate Affairs and the Offices of R

egistrar of Companies, Official Liquidators, Public Trustee, Company Law Board, Director of Inspection, etc. The Registrar of Companies (ROC) handles incorporation of new companies and the administration of running companies. Since its commencement, it has been amended many times, in which amendment of 1988, 1990, 1996, 2000 and 2011 are notable.

                  Like most of Indian acts, it also extends to the whole India except State of Jammu and Kashmir (SECTION 3). Notwithstanding anything contained in the Act every company, international or indigenous will work under the provisions of the Act.This Act is general in nature and not subrogative. So if a special Legislation applies on a Company, then the Company has to, in addition to Companies Act, must comply the special Legislation. For example, all banking Companies in India has to comply Banking Regulation Act 1949, in addition to the Companies Act 1956.Used in commercial application.......

                   The Act is 658 sections long. It contains provisions about Companies, directors of the companies, memorandum and articles of associations, etc. This act states and discusses every single provision requires or may need to govern a company.1956

                     The Company Law Board is an independent quasi-judicial body in India which has powers to overlook the

 behavior of companies within the Company Law. The concept of Company Law Board in its present form was introduced through an amendment to the Companies Act of 1956 in the year 1988. It was constituted in its present form on May 31, 1991.Under Section 10(E) of the Companies Act, 1956 replacing the erstwhile Company Law Board which

was primarily as a delegates of the Central government since 1.2.1964. The Company Law Board has framed Company Law Board Regulations 1991 wherein all the procedure for filing the applications/petitions before the Company Law Board has been prescribed. The Central Government has also prescribed the fees for making applications/petitions before the Company Law Board under the Company Law Board (Fees on applications and Petitions) Rules 1991.

"MCX Stock Exchange"

                    MCX Stock Exchange Limited (MCX-SX), India’s new stock exchange, is recognized by Securities and Exchange Board of India under Section 4 of Securities Contracts (Regulation) Act, 1956. The Exchange was notified as a “recognized stock exchange” under Section 2(39) of the Companies Act, 1956 by the Govt. of India on December 21, 2012. In line with

global best practices and regulatory requirements, clearing and settlement of trades done on the Exchange is conducted through a separate clearing corporation − MCX-SX Clearing Corporation Ltd. (MCX-SX CCL).

MCX-SX commenced operations in Currency Derivatives (CD) segment on October 7, 2008 under the regulatory framework of SEBI(Securities and Exchange Board of India) and Reserve Bank of India (RBI). MCX-SX commenced trading in Capital Market (Equity Cash) and Futures & Options (Equity Derivatives) Segments with effect from February 11, 2013 and started SX40 index fuitures on options on May 15, 2013.

Commitment to Financial Literacy and Inclusion

                  ‘Information, Innovation, Education and Research’ are the four cornerstones of the unique market development philosophy adopted by MCX-SX and supports its mission of Financial-literacy-for-Financial Inclusion™, as is envisaged by the Government of India. As part of this mission, MCX-SX conducts large-scale investor education and awareness programmed across the length and breadth of the country, averaging at least one programmed per working day. MCX-SX collaborates with academic institutions of repute, media, trade bodies, international organisations and industry experts for organizing these programmed. MCX SX is the only exchange that has come up with a ‘Manifesto of Change’, which is a road map of what the Exchange intends to achieve in terms of driving market development and inclusive growth over the next 10 years.

Products :-

Currency Derivatives Segment:

* Currency Futures:

              MCX-SX offers trading in four currency futures pairs – US Dollar-Indian Rupee (USDINR), Euro-Indian Rupee (EURINR), Pound Sterling-Indian Rupee (GBPINR) and JapaneseYen-Indian Rupee (JPYINR)

* Currency Options:

                  MCX-SX offers a European style Call & Put Options in USDINR, with a smaller tick size of 10 bps as compared to others. This facilitates better price discovery, increased hedging effectiveness and cost-effective risk management

Capital Market Segment: 

                  MCX-SX offers a hi-tec and cost effective avenue for new issuance (primary market) as well as trading of securities (secondary market).

Futures & Options Segment:

               MCX-SX offers unique avenue forhedging and leveraging activity huge contract values with a relatively small amounts of margin. Derivatives are fi¬nancial instruments whose value is primarily derived from one or more underlying securities

SX40: 'SX40' is the flagship Index of MCX-SX. A free-float based index of 40 large cap - liquid stocks, representing diverse sectors of the economy. It is designed to be a performance benchmark and to provide for efficient investment and risk management instrument. It would also help in structuring passive investment vehicles.Its base value is 10,000 with the base date of March 31, 2010.

"The Economic Survey of India 2012-13"

                      The  Economic  Survey  is  the  work  of  the  dedicated  staff  of  the  Economic  Division  of  the Department of Economic Affairs in the Ministry of Finance  and some others outside it.  Let me 

start by thanking them for their work, all done with hard deadlines and under enormous pressure.

There are three objectives  for India  that are echoed through much of the Survey.

                   First,  India has to revive growth, and that growth has to provide more  decent  jobs for the many millions who will  join  the  labor  force,  even  while  reducing  poverty.  Second,  India  needs  to  shift  from consumption  to  investment,  that  is,  increase  our  savings  especially  government  savings  and 

household financial savings,  even as we also increase corporate and infrastructure investment. 

Third, India needs macroeconomic stabilization  –  to bring down inflation, the fiscal deficit and 

the current account deficit. There are commonalities between some of these objectives, as also 

apparent tensions.  For example,  re balancing towards investment can  potentially  raise growth as 

well as alleviate supply constraints, reduce inflation, and thus achieve macro stabilization. On the 

other  hand,  fiscal  consolidation  is  often  thought  to  be  detrimental  to  growth  in  the  short-run. 

                   However, this tension may only be

apparent. Macroeconomic rigor may, in fact, lead to growth;

cutting  wasteful  subsidies  may  reduce  market  distortions,  shrink  excess  consumption,  and 

increase confidence about government finances, all of which can help growth, even in the short run. 

The survey starts with an analysis of the causes of the recent slowdown. A number of factors are 

responsible.  First,  the  boost  to  demand  given  by  monetary  and  fiscal  stimulus  following  the 

global financial crisis was large, even though the economy was already reaching the limits to its 

potential  growth  before  the  crisis.  The  resulting  recovery  from  the  crisis  was  strong  and  final 

consumption grew at an average of over 8 percent annually between 2009-10 and 2011-12.  One 

consequence  was  strong  inflation,  and  a  powerful  monetary  response  that  also  slowed 

consumption  demand.  Second,  starting  in  2011-12,  corporate  and  infrastructure  investment 

started  slowing  both  as  a  result  of  policy  bottlenecks  as  well  as  the  tighter  monetary  policy. 

Unfortunately,  even  as  the  economy  slowed,  it  was  hit  by  two  additional  shocks:  a  slowing 

global  economy,  weighed  down  by  the  crisis  in  the  Euro  area  and  uncertainties  about  fiscal 

policy in the United States, and a weak monsoon, at least in its initial phase. 

                   As growth slowed and government revenues did not keep pace with spending, the fiscal deficit 

threatened  to  breach  the  target.  With  government  savings  falling,  and  private  savings  also 

shrinking,  the  current  account  deficit  –  which  is  the  investment  that  cannot  be  financed  by 

domestic savings and has to be financed from abroad – also widened.  

These are difficult times, but  India has navigated such times before, and with good policies  it 

will come through stronger.  The way out  lies in shifting national spending from consumption to 

investment,  removing  the  bottlenecks  to  investment,  growth,  and  job  creation,  in  part  through 

structural  reforms,  combating  inflation  both  through  monetary  and  supply  side  measures, reducing the costs  for borrowers of raising financing and increasing the opportunities for savers 

to  get  strong  real  investment  returns.  The  Survey  lists  a  number  of  measures  that  have  been 

implemented, as well as some that are needed.  

                     Every  recent  Survey  has  had  a  special  chapter,  with  this  one’s  focusing  on  jobs. 

Policymakers are  usually attentive to  short-run economic management issues. But the short run 

has to be a bridge to the long run. The central long-run question facing India is where will good 

jobs  come  from?  Productive  jobs  are  vital  for  growth.  And  a  good  job  is  the  best  form  of 

inclusion.  More  than  half  our  population  depends  on  agriculture,  but  the  experience  of  other 

countries suggests that the number of people dependent on agriculture will have to  shrink if per 

capital incomes in agriculture are to go up substantially. While industry is creating jobs, too many 

such jobs are low-productivity informal and non-regular  jobs in the unorganized sector, offering 

low  incomes,  little  protection  or  benefits.  Services  jobs  are  relatively  high  productivity,  but 

employment growth in services has been slow in recent years. India’s challenge is to create the 

conditions  for  faster  growth  of  productive  jobs  outside  of  agriculture,  especially  in  organized 

manufacturing  and  in  services,  even  while  improving  productivity  in  agriculture.  The  chapter 

calls for reforms, including the expansion of infrastructure, better and more effective regulation, 

and improvements in access to land and finance that would encourage the entry and growth of 

business  enterprises.  The  chapter  suggests  that  unless  India  undertakes  these  reforms,  it  will 

grow far below potential, and risks fiscal strains and social unrest as more and more people fall 

behind.     

"Economic Survey of India 2011-12"

                   The Economic survey of India 2011 tells that the Indian economy in the year 2010-11 has showed a healthy growth and a stable fiscal consolidation.

                   The global financial crisis of 2007-09 had initially caused a sluggish growth. But a remarkable emergence in the Indian Economy has been observed even after the slowdown, happened due to the crisis.

The estimated growth of 8.6% has been witnessed (as per CSO report, 7 February 2011). The growth has been strong in the agricultural sector and in the manufacturing sector. Inflation on the other hand seems to be high but it has come down distinctly from the initial position i.e. the start of the fiscal year.

There were a few challenges faced during the survey – economic governance, efficiency of subsidies and infrastructure. There are policies which are made in order to tackle such problems.

Highlights of the survey :-

                       There has been a growth of 9.7% of the GDP (at market price) in the investments and savings and the private consumption as witnessed by the survey. The rise in the savings rate and the rate of investment was up to 33.7% and 36.5% respectively in the year 2009-10.

According to the survey the growth in the agricultural sector in the initial 4 years of the 11th year plan (2007–12) was around 2.87%. In the year 2009-10 the production of the food grains hiked to 232.1 billion tons from 218.1 billion tons. This year i.e. 2010-11 the agricultural sector is expected to have a growth of 5.7% as the monsoon is expected to be comparatively good. The rise in food inflation and the growing need of agricultural product in the country has initiated to the need of a second green revolution.

The industrial growth rate is 8.6% of the GDP at market price where as the manufacturing sector has witnessed a growth of 9.1% in 2010-11. Certain sectors like the telecom, crude oil production, civil aviation have well achieved during the period of April–November where as there has been a low rate of growth in the cement and fertilizer production, power generation, railway and cargo sectors.

The economic survey 2010-11 has seen that with the rising investment the role of infrastructure has been escalating. There has been a huge growth in the tele density increasing from 20.74% in the year 2004 to 143.95% in the year 2010 in urban areas and 1.57% in the year 2004 to 30.18% in the year 2010 in rural areas. This shows that the telecommunication sector is performing extremely well.

As far as the service sector is concerned the survey have suggested for policies I order to promote certain services like tourism, accounting, education, financial, legal services.

The Forex  Reserves is predicted to be US $ 297.3 bn. The survey states that in April- December 2010 the exports would go up by 29.5% and the imports would rise up by 19%.

The survey also observed a rise in Net Banking which was estimated to be 59%. This shows that the Banking sector has been performing effectively. Social program me spending has been gone up by 5% of the GDP.

According to the survey the Gross Fiscal Deficit has gone down by 1.5%. That is 4.8% from 6.3%in the year before

Agriculture and Food Management :-

                            The growth of the agricultural sector plays an important part over the in performance of the Indian economy. After the quantum leap in agriculture due to 1960s Green Revolution, which also lead to achievement of food security to a great extent, no such findings have been witnessed in India since then.

The rapid increasing demand for food security has established the demand for a Second Green Revolution.

But it does not end here, further special attention to fruits, vegetables, pulses and oilseeds are a must to increase its production and productivity levels, for the reason that First Green Revolution did not pay any heed to the same.

There has been an increase in the entire cropping area by 2.33 lakh hectors in the year 2010 as compared with the year 2009 in food grains, oilseeds, sugarcane and cotton. Whereas there is a decrease in the cropping area by 5.3 lakh hectors of the rice growing areas of West Bengal, Bihar and Uttar Pradesh due to drought during 2010. Same has been the case with the cropping areas under coarse cereals which has decreased by 3.42 lakh hectors, but in the case of pulses the cropping area has gone up by 6.11 lakh hectors in 2010 which is seems to be quiet good. The total area under food grains has decreased by 2.71 lakh hectors. The cropping area for ground nuts has increased by 4 lakh hectors.[14] The overall area in oilseeds has decreased by 8.27 lakh in 2010.

"Market Capitalization"

                    

   Market capitalization (or market cap) is the total value of the issued shares of a publicly traded company; it is equal to the share price times the number of shares outstanding. As outstanding stock is bought and sold in public markets, capitalization could be used as a proxy for the public opinion of a company's net worth and is a determining factor in some forms of stock valuation.

The total capitalization of stock markets or economic regions may be compared to other economic indicators. The total market capitalization of all publicly traded companies in the world was US$51.2 trillion in January 2007 and rose as high as US$57.5 trillion in May 2008 before dropping below US$50 trillion in August 2008 and slightly above US$40 trillion in September 2008.

Market Capitalization Terms :-

                          Traditionally, companies were divided into large-cap, mid-cap, and small-cap. The terms mega-cap and micro-cap have also since come into common use, and nano-cap is sometimes heard. Different numbers are used by different indexes; there is no official definition of, or full consensus agreement about, the exact cutoff values. The cutoffs may be defined as percentiles rather than in nominal dollars. The definitions expressed in nominal dollars need to be adjusted over the decades due to inflation, population change, and overall market valuation (for example, $1 billion was a large market cap in 1950, but it is not very large now), and they may be different for different countries. A rule of thumb may look like:

Mega-cap: Over $200 billion

Large-cap: Over $10 billion

Mid-cap: $2 billion–$10 billion

Small-cap: $250 million–$2 billion

Micro-cap: Below $250 million

Nano-cap: Below $50 million

"Cap" is short for capitalization, a measure by which a company's size is classified. Big/Large caps are companies that have a market cap between $10–200 billion dollars. Mid caps range from $2 billion to $10 billion dollars. Small caps are typically new or relatively young companies and have a market cap between $100 million to $1 billion dollars. Small Cap's track record is not as lengthy as that of the mid to Mega Caps.  Small Caps present the possibility of greater capital appreciation, but at greater risk.

Market cap reflects only the equity value of a company. It is important to note that a firm's choice of capital structure has a significant impact on how the total value of a company is allocated between equity and debt. A more comprehensive measure is enterprise value (EV), which includes debt, preferred stock, and other factors. Insurance firms use a value called the embedded value (EV).