CMA Intermediate - Corporate & Other Laws (2026)

Case Scenario - I: Aarohan Industries Ltd., a public limited company manufacturing electrical equipment, recorded turnover of Rs.1,150 crore in FY 2024-25, net profit (u/s 198) of Rs.12 crore, and net worth of Rs.620 crore. Net profits for preceding 3 years: 2021-22 Rs.8cr, 2022-23 Rs.10cr, 2023-24 Rs.12cr. The company constituted a CSR Committee of three directors including one independent director and was obligated to spend prescribed % of net profits on CSR for 2024-25. Board approved CSR budget of Rs.20 lakh but only Rs.14 lakh was spent (unspent amount not related to any ongoing project); reasons disclosed in Board's Report; no separate bank account opened. CSR provisions were made applicable to Aarohan Industries Ltd. for the financial year 2024-25 mainly because:

Case Scenario - I: Aarohan Industries Ltd., a public limited company manufacturing electrical equipment, recorded turnover of Rs.1,150 crore in FY 2024-25, net profit (u/s 198) of Rs.12 crore, and net worth of Rs.620 crore. Net profits for preceding 3 years: 2021-22 Rs.8cr, 2022-23 Rs.10cr, 2023-24 Rs.12cr. The company constituted a CSR Committee of three directors including one independent director and was obligated to spend prescribed % of net profits on CSR for 2024-25. Board approved CSR budget of Rs.20 lakh but only Rs.14 lakh was spent (unspent amount not related to any ongoing project); reasons disclosed in Board's Report; no separate bank account opened. If in case Aarohan Industries Ltd. was a company covered under Section 135(1) but is not required to appoint an independent director under Section 149(4). In such a case, which of the following statement is correct regarding the composition of its CSR Committee?

Case Scenario - I: Aarohan Industries Ltd., a public limited company manufacturing electrical equipment, recorded turnover of Rs.1,150 crore in FY 2024-25, net profit (u/s 198) of Rs.12 crore, and net worth of Rs.620 crore. Net profits for preceding 3 years: 2021-22 Rs.8cr, 2022-23 Rs.10cr, 2023-24 Rs.12cr. The company constituted a CSR Committee of three directors including one independent director and was obligated to spend prescribed % of net profits on CSR for 2024-25. Board approved CSR budget of Rs.20 lakh but only Rs.14 lakh was spent (unspent amount not related to any ongoing project); reasons disclosed in Board's Report; no separate bank account opened. As Aarohan Industries Ltd. could not spend the entire prescribed CSR amount during the financial year 2024-25, considering the 4 options given below, choose the correct option applicable to the company regarding the unspent CSR funds:

Case Scenario - II: Zed Technologies Limited, a public company, authorised share capital Rs.10 crore, paid-up capital Rs.5 crore (50 lakh equity shares of Rs.10 each), 2,300 equity shareholders with equal voting rights. Board on 1st June 2024 resolved to convene AGM on 25th June 2024 at 11:00 a.m.; notice sent on 3rd June 2024 electronically to all members, directors and auditors and placed on website. Agenda included a related party transaction with Alpha Systems Pvt. Ltd., in which one director of Zed held 1,50,000 equity shares of Rs.10 each (paid-up capital of Alpha is Rs.5 crore i.e. 50,00,000 shares of Rs.10 each). On 25th June 2024, AGM called to order at 11:00 a.m.; by 11:30 a.m. 16 members personally present. 42 members holding 3,80,000 shares appointed the same person as proxy; one shareholder holding 6,00,000 shares appointed a different single person as proxy (Form MGT-11, deposited 10:30 a.m. on 23rd June 2024). The AGM included a special business approving a related party transaction with Alpha Systems Pvt. Ltd., in which one director of Zed Technologies Limited held equity shares. Which statement is correct as to the transaction of the special business in the meeting?

Case Scenario - II: Zed Technologies Limited, a public company, authorised share capital Rs.10 crore, paid-up capital Rs.5 crore (50 lakh equity shares of Rs.10 each), 2,300 equity shareholders with equal voting rights. Board on 1st June 2024 resolved to convene AGM on 25th June 2024 at 11:00 a.m.; notice sent on 3rd June 2024 electronically to all members, directors and auditors and placed on website. Agenda included a related party transaction with Alpha Systems Pvt. Ltd., in which one director of Zed held 1,50,000 equity shares of Rs.10 each (paid-up capital of Alpha is Rs.5 crore i.e. 50,00,000 shares of Rs.10 each). On 25th June 2024, AGM called to order at 11:00 a.m.; by 11:30 a.m. 16 members personally present. 42 members holding 3,80,000 shares appointed the same person as proxy; one shareholder holding 6,00,000 shares appointed a different single person as proxy (Form MGT-11, deposited 10:30 a.m. on 23rd June 2024). Determine the validity of the quorum at 11.30 am on the date of the AGM as 16 members out of 2300 members were personally present in the meeting along with the proxies of other members.

Case Scenario - III: Shradhha Metals Ltd., an eligible company, had outstanding secured deposits of Rs.50 crore as on 31st March 2025, of which Rs.20 crore is due for repayment during FY 2025-26. The company deliberately did not comply with the requirement of placing a percentage of maturing deposits in a 'Deposit Repayment Reserve Account' with a scheduled bank. For the year ended 31st March 2025, the company earned net profit of Rs.35 crore (after Schedule II depreciation) and had free reserves of Rs.85 crore; the Board recommended dividend @15% per share on 14th July 2025. Ritika, a depositor of Rs.5 lakh maturing on 25th April 2025, sent her discharged deposit receipt with bank details for direct credit; the company did not pay on the due date; after a legal notice through her Advocate, the company paid her on 13th July 2025. Another depositor, Rajesh, has not claimed his matured deposit, and the company is not at default with respect to him. The penal rate of interest payable on the deposit of Rajesh until it is claimed by him is:

Case Scenario - III: Shradhha Metals Ltd., an eligible company, had outstanding secured deposits of Rs.50 crore as on 31st March 2025, of which Rs.20 crore is due for repayment during FY 2025-26. The company deliberately did not comply with the requirement of placing a percentage of maturing deposits in a 'Deposit Repayment Reserve Account' with a scheduled bank. For the year ended 31st March 2025, the company earned net profit of Rs.35 crore (after Schedule II depreciation) and had free reserves of Rs.85 crore; the Board recommended dividend @15% per share on 14th July 2025. Ritika, a depositor of Rs.5 lakh maturing on 25th April 2025, sent her discharged deposit receipt with bank details for direct credit; the company did not pay on the due date; after a legal notice through her Advocate, the company paid her on 13th July 2025. Another depositor, Rajesh, has not claimed his matured deposit, and the company is not at default with respect to him. How much amount is the company required to deposit in a scheduled bank in a separate bank account to be called as 'Deposit Repayment Reserve Account'?

Case Scenario - III: Shradhha Metals Ltd., an eligible company, had outstanding secured deposits of Rs.50 crore as on 31st March 2025, of which Rs.20 crore is due for repayment during FY 2025-26. The company deliberately did not comply with the requirement of placing a percentage of maturing deposits in a 'Deposit Repayment Reserve Account' with a scheduled bank. For the year ended 31st March 2025, the company earned net profit of Rs.35 crore (after Schedule II depreciation) and had free reserves of Rs.85 crore; the Board recommended dividend @15% per share on 14th July 2025. Ritika, a depositor of Rs.5 lakh maturing on 25th April 2025, sent her discharged deposit receipt with bank details for direct credit; the company did not pay on the due date; after a legal notice through her Advocate, the company paid her on 13th July 2025. Another depositor, Rajesh, has not claimed his matured deposit, and the company is not at default with respect to him. Decide the most appropriate answer as to whether the company can declare dividend to the shareholders on 14th July, 2025:

Case Scenario - IV: ABC Infrastructure & Broadcasting Limited (AIBL), a Government of India PSU engaged in infrastructure and satellite television operations, proposed FY 2025-26 forex transactions: (i) remittance of USD 18,000 for advertisement in a foreign print magazine for brand building (not for tourism/investment promotion or international bidding); (ii) consultancy fee of USD 11.5 million to a foreign firm for a highway project in India, with in-principle approval of the Information & Broadcasting Ministry (Parent Ministry) for both the advertisement and consultancy fee. Mr. Rohan Mehta, a resident director of AIBL, proposes during FY 2025-26 to remit USD 2,10,000 for his daughter's higher education abroad (USD 1,50,000 being tuition fee required by the university, balance for associated education purposes not required by the institute) and USD 70,000 as a gift to his sister in Australia; no other remittances made during the year. Mr. Rohan Mehta inherited a foreign immovable property from his resident father, who in turn had inherited it from the grandfather, who had purchased the property while working outside India. If AIBL needs to remit USD 18,000 for the corporate advertisement in a foreign print magazine purely for brand building, not related to tourism promotion, foreign investment promotion, or international bidding, choose the correct option available to it under the applicable FEMA and the Current Account Transaction Rules:

Case Scenario - IV: ABC Infrastructure & Broadcasting Limited (AIBL), a Government of India PSU engaged in infrastructure and satellite television operations, proposed FY 2025-26 forex transactions: (i) remittance of USD 18,000 for advertisement in a foreign print magazine for brand building (not for tourism/investment promotion or international bidding); (ii) consultancy fee of USD 11.5 million to a foreign firm for a highway project in India, with in-principle approval of the Information & Broadcasting Ministry (Parent Ministry) for both the advertisement and consultancy fee. Mr. Rohan Mehta, a resident director of AIBL, proposes during FY 2025-26 to remit USD 2,10,000 for his daughter's higher education abroad (USD 1,50,000 being tuition fee required by the university, balance for associated education purposes not required by the institute) and USD 70,000 as a gift to his sister in Australia; no other remittances made during the year. Mr. Rohan Mehta inherited a foreign immovable property from his resident father, who in turn had inherited it from the grandfather, who had purchased the property while working outside India. In light of the Liberalised Remittance Scheme (LRS) of FEMA Act, 1999, which of the following is correct for the proposed remittance of Mr. Rohan Mehta?

Case Scenario - IV: ABC Infrastructure & Broadcasting Limited (AIBL), a Government of India PSU engaged in infrastructure and satellite television operations, proposed FY 2025-26 forex transactions: (i) remittance of USD 18,000 for advertisement in a foreign print magazine for brand building (not for tourism/investment promotion or international bidding); (ii) consultancy fee of USD 11.5 million to a foreign firm for a highway project in India, with in-principle approval of the Information & Broadcasting Ministry (Parent Ministry) for both the advertisement and consultancy fee. Mr. Rohan Mehta, a resident director of AIBL, proposes during FY 2025-26 to remit USD 2,10,000 for his daughter's higher education abroad (USD 1,50,000 being tuition fee required by the university, balance for associated education purposes not required by the institute) and USD 70,000 as a gift to his sister in Australia; no other remittances made during the year. Mr. Rohan Mehta inherited a foreign immovable property from his resident father, who in turn had inherited it from the grandfather, who had purchased the property while working outside India. Choose the correct option from the following pertaining to the legality of the inheritance of foreign immovable property by Mr. Rohan Mehta:

Case Scenario - V: Anvika & Associates LLP is engaged in the architectural profession with two designated partners, Anvika and Ela. Both went to UK on 1st July 2025 for a 6-month advanced training course, then holidayed in Europe, and returned to India on 1st March 2026. Before leaving, they hired Falak as an employee to look after the business; they later decided to admit Falak as a partner, informing him of their intention on 10th January 2026. Falak accepted the offer on 13th January 2026, with effect from 15th January 2026. The LLP did not inform the Registrar about the admission of the new partner. As per the provisions of the LLP Act, 2008 every LLP shall have at least two designated partners who are individuals and at least one of them shall be a resident in India. In the given case, both the designated partners remained out of India for some time. Whether the requirement of 'Resident in India' of the designated partners has been fulfilled by them:

Case Scenario - V: Anvika & Associates LLP is engaged in the architectural profession with two designated partners, Anvika and Ela. Both went to UK on 1st July 2025 for a 6-month advanced training course, then holidayed in Europe, and returned to India on 1st March 2026. Before leaving, they hired Falak as an employee to look after the business; they later decided to admit Falak as a partner, informing him of their intention on 10th January 2026. Falak accepted the offer on 13th January 2026, with effect from 15th January 2026. The LLP did not inform the Registrar about the admission of the new partner. In Anvika & Associates LLP, Falak, who was an employee in the firm accepted to join the firm as a Partner on 15th January, 2026. However, the LLP forgot to inform Registrar about this new admission of partner. According to the LLP Act, 2008 what is the time limit within which the LLP is required to file a notice with the Registrar:

Case Scenario - VI: Mr. A, owner of a residential house, terminates the tenancy of Mr. B (his tenant) for continuous rent default, sending a notice of termination by registered post to Mr. B's correct address; the postal article was returned endorsed 'Refused by addressee'. Mr. B challenges the eviction on the ground he never received/read the notice. Separately, a Central Regulation made in 2018 prohibits establishing a chemical factory within 500 metres of a protected wildlife sanctuary. Mr. A applies to set up a chemical factory near the sanctuary; the distance between the factory site and the sanctuary boundary is 520 metres if measured along the road. The authority rejects Mr. A's application, stating the factory is within the prohibited distance, and Mr. A challenges the decision. As Mr. B has challenged the validity of the notice, in the light of the above facts, which of the following is the most appropriate legal position pertaining to the validity of the notice?

With regard to the measurement of distances for the purposes of any Central Act or Regulation made after the commencement of the General Clauses Act, 1897, the correct approach to measure the distance from the wildlife sanctuary to the proposed factory is: