71 VALUATION EXAMINATION MCQS JUDICIAL PRONOUNCEMENT FOR PRACTICE IBBI EXAMINATION FOR PRACTICE
WITH A FOCUS ON 1 MARK
General Overview of SFA in Insolvency
1. In the case of Miheer H. Mafatlal v. Mafatlal Industries Ltd. (1997), the Supreme Court primarily addressed:
a) Insider trading in securities
b) Valuation of shares during corporate disputes
c) Non-disclosure of financial assets
d) Corporate fraud in financial transactions
Answer: b) Valuation of shares during corporate disputes
2. Which of the following cases dealt with the issue of valuation of shares during a dispute between a company and its shareholders?
a) Hindustan Lever Employees’ Union v. Hindustan Lever Ltd.
b) Miheer H. Mafatlal v. Mafatlal Industries Ltd.
c) Brooke Bond Lipton India Ltd.
d) Dinesh Vrajlal Lakhani v. Parke Davis (India) Ltd.
Answer: b) Miheer H. Mafatlal v. Mafatlal Industries Ltd.
3. The case of Hindustan Lever Employees’ Union v. Hindustan Lever Ltd. (1995) primarily concerned:
a) Market manipulation and its impact on securities valuation
b) Valuation of shares during employee disputes
c) Taxation of financial assets
d) Financial disclosure during public offers
Answer: b) Valuation of shares during employee disputes
4. In Brooke Bond Lipton India Ltd. (1999), the Court dealt with:
a) Valuation of securities in public issue disputes
b) Shareholder rights and valuation during corporate restructuring
c) Corporate fraud in securities market
d) Insider trading violations
Answer: b) Shareholder rights and valuation during corporate restructuring
5. In Dinesh Vrajlal Lakhani v. Parke Davis (India) Ltd. (2005), the Bombay High Court ruled on:
a) The impact of market manipulation on securities valuation
b) Shareholder rights in financial disputes
c) Valuation of shares in the context of mergers
d) Valuation of financial assets during litigation
Answer: d) Valuation of financial assets during litigation
6. The ruling in Dr. Mrs. Renuka Datla v. Solvay Pharmaceutical B.V. and Ors. addressed:
a) Corporate restructuring and valuation of shares
b) The methodology for determining fair value of financial assets
c) Mergers and acquisitions and valuation discrepancies
d) Insider trading and its impact on asset valuation
Answer: b) The methodology for determining fair value of financial assets
7. In G.L. Sultania v. The Securities and Exchange Board of India, the Court dealt with:
a) Market manipulation and its effect on securities valuation
b) The role of SEBI in ensuring accurate valuation during public offers
c) Shareholder rights during corporate debt restructuring
d) Valuation of assets in cases of financial fraud
Answer: a) Market manipulation and its effect on securities valuation
8. The case Miheer H. Mafatlal v. Mafatlal Industries Ltd. (1997) dealt with the valuation of shares in which context?
a) Insider trading
b) Mergers and acquisitions
c) Shareholder dispute involving the oppression of minority shareholders
d) Corporate fraud
Answer: c) Shareholder dispute involving the oppression of minority shareholders
9. Which case clarified the method for valuation of shares during disputes involving employee unions and companies?
a) Miheer H. Mafatlal v. Mafatlal Industries Ltd.
b) Hindustan Lever Employees’ Union v. Hindustan Lever Ltd.
c) Brooke Bond Lipton India Ltd.
d) Dinesh Vrajlal Lakhani v. Parke Davis (India) Ltd.
Answer: b) Hindustan Lever Employees’ Union v. Hindustan Lever Ltd.
10. In the case of Brooke Bond Lipton India Ltd. (1999), the Calcutta High Court focused on:
a) Valuation of financial assets in fraudulent corporate transactions
b) Shareholder disputes and share valuation during corporate restructuring
c) Insider trading and market manipulation
d) Taxation of corporate assets
Answer: b) Shareholder disputes and share valuation during corporate restructuring
11. The case of Dinesh Vrajlal Lakhani v. Parke Davis (India) Ltd. (2005) focused on:
a) Valuation of unlisted securities during shareholder disputes
b) Valuation of financial assets during mergers and acquisitions
c) Corporate fraud in the securities market
d) Regulatory compliance in securities transactions
Answer: a) Valuation of unlisted securities during shareholder disputes
12. What was the primary issue in the case of Dr. Mrs. Renuka Datla v. Solvay Pharmaceutical B.V. (2004)?
a) Financial fraud and securities manipulation
b) Valuation of assets during a takeover bid
c) Determination of fair value of financial assets
d) Insider trading violations
Answer: c) Determination of fair value of financial assets
13. Which case highlighted the role of the Securities and Exchange Board of India (SEBI) in ensuring accurate valuation of securities?
a) Miheer H. Mafatlal v. Mafatlal Industries Ltd.
b) G.L. Sultania v. SEBI
c) Hindustan Lever Employees’ Union v. Hindustan Lever Ltd.
d) Brooke Bond Lipton India Ltd.
Answer: b) G.L. Sultania v. SEBI
14. In the Miheer H. Mafatlal v. Mafatlal Industries Ltd. (1997) case, what was the central issue related to securities?
a) Shareholder oppression and fair valuation of shares
b) Insider trading practices
c) Corporate governance in securities markets
d) Taxation of financial assets
Answer: a) Shareholder oppression and fair valuation of shares
15. Which case dealt with the issue of determining the fair value of financial assets during disputes between shareholders and the company?
a) Miheer H. Mafatlal v. Mafatlal Industries Ltd.
b) Dinesh Vrajlal Lakhani v. Parke Davis (India) Ltd.
c) Brooke Bond Lipton India Ltd.
d) Dr. Mrs. Renuka Datla v. Solvay Pharmaceutical B.V.
Answer: a) Miheer H. Mafatlal v. Mafatlal Industries Ltd.
16. In the case of Hindustan Lever Employees’ Union v. Hindustan Lever Ltd., the Court ruled on:
a) The calculation of fair value during employee buyouts
b) Market manipulation during public offers
c) Corporate debt restructuring and asset valuation
d) Fairness of a company’s financial statements
Answer: a) The calculation of fair value during employee buyouts
17. Which case dealt with the valuation of shares during a dispute between a company and its employees regarding compensation and buyout?
a) Miheer H. Mafatlal v. Mafatlal Industries Ltd.
b) Hindustan Lever Employees’ Union v. Hindustan Lever Ltd.
c) Brooke Bond Lipton India Ltd.
d) Dinesh Vrajlal Lakhani v. Parke Davis (India) Ltd.
Answer: b) Hindustan Lever Employees’ Union v. Hindustan Lever Ltd.
18. In Brooke Bond Lipton India Ltd. (1999), the Court focused on:
a) Market manipulation
b) Valuation of shares in the context of mergers
c) Valuation of assets during shareholder disputes
d) Insider trading violations
Answer: c) Valuation of assets during shareholder disputes
19. In Dinesh Vrajlal Lakhani v. Parke Davis (India) Ltd. (2005), the Bombay High Court ruled that:
a) The valuation of shares in the market is not relevant for shareholder disputes
b) Valuation of financial assets should be based on fair market value
c) Market manipulation should be considered in securities valuation
d) The valuation process must always involve SEBI
Answer: b) Valuation of financial assets should be based on fair market value
20. The case Dr. Mrs. Renuka Datla v. Solvay Pharmaceutical B.V. (2004) emphasized:
a) Valuation of shares in hostile takeovers
b) Valuation methods for unlisted companies
c) Determination of fair market value in case of corporate dispute
d) Insider trading in the pharmaceutical sector
Answer: c) Determination of fair market value in case of corporate dispute
21. The case of G.L. Sultania v. SEBI (2005) dealt with:
a) Insider trading
b) Corporate governance and asset valuation
c) SEBI’s role in overseeing corporate valuations in public offers
d) Disputes over securities in shareholder agreements
Answer: b) Corporate governance and asset valuation
26. In Brooke Bond Lipton India Ltd. (1999), the Calcutta High Court emphasized the importance of:
a) Insider trading investigations
b) Shareholder rights in cases of unfair share valuation
c) Taxation on securities
d) Corporate fraud in market dealings
Answer: b) Shareholder rights in cases of unfair share valuation
27. The case Miheer H. Mafatlal v. Mafatlal Industries Ltd. (1997) clarified the legal framework for:
a) Valuation of securities in financial fraud cases
b) Valuation in mergers and acquisitions
c) Oppression of minority shareholders and fair valuation of shares
d) Determining the market price for publicly listed securities
Answer: c) Oppression of minority shareholders and fair valuation of shares
28. In Dinesh Vrajlal Lakhani v. Parke Davis (India) Ltd. (2005), the Bombay High Court focused on:
a) Market valuation for unlisted securities
b) Fair value determination in shareholder disputes
c) Regulatory measures for securities in public offers
d) Valuation of securities in cases of corporate debt restructuring
Answer: b) Fair value determination in shareholder disputes
29. The Supreme Court in Miheer H. Mafatlal v. Mafatlal Industries Ltd. (1997) ruled that in cases of shareholder disputes, the court should:
a) Rely on market prices to resolve disputes
b) Appoint an independent valuer for fair share valuation
c) Defer to company management’s valuation of securities
d) Only consider the value of assets as per financial statements
Answer: b) Appoint an independent valuer for fair share valuation
30. In G.L. Sultania v. SEBI, the Court ruled on the issue of:
a) Corporate fraud and its impact on asset valuation
b) The valuation of shares in cases of market manipulation
c) SEBI’s role in ensuring accurate market valuations
d) Valuation disputes in corporate mergers
Answer: c) SEBI’s role in ensuring accurate market valuations
31. Which case dealt with the application of fair valuation principles in the context of employee buyouts?
a) Hindustan Lever Employees’ Union v. Hindustan Lever Ltd.
b) Miheer H. Mafatlal v. Mafatlal Industries Ltd.
c) Dinesh Vrajlal Lakhani v. Parke Davis (India) Ltd.
d) G.L. Sultania v. SEBI
Answer: a) Hindustan Lever Employees’ Union v. Hindustan Lever Ltd.
32. In Dr. Mrs. Renuka Datla v. Solvay Pharmaceutical B.V. (2004), the Court was concerned with:
a) Insider trading in the pharmaceutical sector
b) Valuation methodologies in mergers and acquisitions
c) The determination of fair market value in shareholder disputes
d) Valuation of assets in cases of market manipulation
Answer: c) The determination of fair market value in shareholder disputes
33. Which case addressed the valuation of shares in a corporate dispute involving a minority shareholder’s rights?
a) Hindustan Lever Employees’ Union v. Hindustan Lever Ltd.
b) Miheer H. Mafatlal v. Mafatlal Industries Ltd.
c) Brooke Bond Lipton India Ltd.
d) Dinesh Vrajlal Lakhani v. Parke Davis (India) Ltd.
Answer: b) Miheer H. Mafatlal v. Mafatlal Industries Ltd.
34. Which of the following judgments is known for its ruling on market manipulation and its impact on the valuation of securities?
a) Miheer H. Mafatlal v. Mafatlal Industries Ltd.
b) G.L. Sultania v. SEBI
c) Hindustan Lever Employees’ Union v. Hindustan Lever Ltd.
d) Dr. Mrs. Renuka Datla v. Solvay Pharmaceutical B.V.
Answer: b) G.L. Sultania v. SEBI
35. The case of Brooke Bond Lipton India Ltd. (1999) dealt with:
a) Valuation of securities in market manipulation cases
b) Valuation principles in employee union disputes
c) Disputes regarding valuation of securities in the context of a corporate merger
d) Insider trading investigations
Answer: c) Disputes regarding valuation of securities in the context of a corporate merger
36. In Dinesh Vrajlal Lakhani v. Parke Davis (India) Ltd., the Court discussed:
a) Corporate fraud and valuation of assets
b) Valuation discrepancies in financial fraud cases
c) The process of determining fair value in shareholder disputes
d) Market manipulation in public securities
Answer: c) The process of determining fair value in shareholder disputes
37. In Miheer H. Mafatlal v. Mafatlal Industries Ltd. (1997), the Court ruled that when there is oppression of minority shareholders, the company must:
a) Accept the market value of shares without dispute
b) Appoint an independent valuer to determine fair share value
c) Rely on the valuation given by the majority shareholders
d) Defer the matter to SEBI for determination of fair value
Answer: b) Appoint an independent valuer to determine fair share value
38. Which of the following cases discusses the valuation of securities during a hostile takeover?
a) Dr. Mrs. Renuka Datla v. Solvay Pharmaceutical B.V.
b) Miheer H. Mafatlal v. Mafatlal Industries Ltd.
c) G.L. Sultania v. SEBI
d) Hindustan Lever Employees’ Union v. Hindustan Lever Ltd.
Answer: a) Dr. Mrs. Renuka Datla v. Solvay Pharmaceutical B.V.
39. The Court in G.L. Sultania v. SEBI ruled that SEBI must ensure:
a) Fair market pricing of securities during corporate disputes
b) The timely valuation of assets in public offers
c) Accurate disclosures regarding financial assets in market reports
d) Regulatory compliance in securities transactions
Answer: b) The timely valuation of assets in public offers
40. In the case of Brooke Bond Lipton India Ltd. (1999), the Calcutta High Court addressed the issue of:
a) Corporate fraud and insider trading
b) Disputes over the valuation of shares in a merger scenario
c) The role of stock exchanges in market manipulation
d) Determining fair value in cases of employee buyouts
Answer: b) Disputes over the valuation of shares in a merger scenario
41. Which case addresses the valuation of unlisted securities in shareholder disputes?
a) Miheer H. Mafatlal v. Mafatlal Industries Ltd.
b) Hindustan Lever Employees’ Union v. Hindustan Lever Ltd.
c) Dinesh Vrajlal Lakhani v. Parke Davis (India) Ltd.
d) Brooke Bond Lipton India Ltd.
Answer: c) Dinesh Vrajlal Lakhani v. Parke Davis (India) Ltd.
42. The case Hindustan Lever Employees’ Union v. Hindustan Lever Ltd. (1995) involved the valuation of shares in:
a) A corporate fraud case
b) A dispute over the fair treatment of employees
c) A takeover of a competing company
d) A dispute over employee stock options and buyouts
Answer: d) A dispute over employee stock options and buyouts
43. Which of the following rulings emphasizes the importance of appointing an independent valuer in shareholder disputes?
a) Hindustan Lever Employees’ Union v. Hindustan Lever Ltd.
b) Miheer H. Mafatlal v. Mafatlal Industries Ltd.
c) Brooke Bond Lipton India Ltd.
d) Dinesh Vrajlal Lakhani v. Parke Davis (India) Ltd.
Answer: b) Miheer H. Mafatlal v. Mafatlal Industries Ltd.
44. In G.L. Sultania v. SEBI, the Court ruled that SEBI must oversee:
a) The valuation of securities in case of market manipulation
b) Valuation of unlisted securities during shareholder disputes
c) Corporate fraud investigations regarding asset misappropriation
d) Regulatory compliance in public securities offers
Answer: a) The valuation of securities in case of market manipulation
45. Which of the following cases involves the issue of valuation discrepancies in the context of employee stock options?
a) Miheer H. Mafatlal v. Mafatlal Industries Ltd.
b) Hindustan Lever Employees’ Union v. Hindustan Lever Ltd.
c) Dinesh Vrajlal Lakhani v. Parke Davis (India) Ltd.
d) G.L. Sultania v. SEBI
Answer: b) Hindustan Lever Employees’ Union v. Hindustan Lever Ltd.
51. In the case of Miheer H. Mafatlal v. Mafatlal Industries Ltd. (1997), the Supreme Court emphasized that valuation disputes arising out of oppression of minority shareholders should be settled by:
a) The stock market value of shares
b) An independent and fair valuation of shares
c) The valuation determined by majority shareholders
d) Government regulatory agencies
Answer: b) An independent and fair valuation of shares
52. In Brooke Bond Lipton India Ltd. (1999), the Calcutta High Court highlighted the importance of:
a) Valuation of securities in cases of insider trading
b) The role of shareholders in determining fair value during mergers
c) Regulatory compliance by companies during securities issuance
d) The role of independent valuers in resolving valuation disputes during corporate restructuring
Answer: d) The role of independent valuers in resolving valuation disputes during corporate restructuring
53. Which of the following judgments discussed the importance of using fair value rather than market value in shareholder disputes?
a) Dinesh Vrajlal Lakhani v. Parke Davis (India) Ltd.
b) Miheer H. Mafatlal v. Mafatlal Industries Ltd.
c) Hindustan Lever Employees’ Union v. Hindustan Lever Ltd.
d) G.L. Sultania v. SEBI
Answer: b) Miheer H. Mafatlal v. Mafatlal Industries Ltd.
54. The ruling in Dr. Mrs. Renuka Datla v. Solvay Pharmaceutical B.V. (2004) primarily dealt with:
a) Shareholder disputes in public companies
b) The proper valuation of assets during an international takeover
c) Valuation techniques for unlisted securities in hostile takeovers
d) The role of regulatory agencies in managing securities markets
Answer: b) The proper valuation of assets during an international takeover
55. In G.L. Sultania v. SEBI (2005), the Court emphasized the role of SEBI in:
a) Enforcing transparency in share buybacks
b) Ensuring fair and accurate valuation of securities during public offerings
c) Regulating insider trading practices
d) Ensuring accurate corporate disclosures in financial statements
Answer: b) Ensuring fair and accurate valuation of securities during public offerings
56. Which of the following cases involved a dispute over the fair valuation of shares during the process of corporate buyout?
a) Hindustan Lever Employees’ Union v. Hindustan Lever Ltd.
b) Miheer H. Mafatlal v. Mafatlal Industries Ltd.
c) Brooke Bond Lipton India Ltd.
d) Dinesh Vrajlal Lakhani v. Parke Davis (India) Ltd.
Answer: a) Hindustan Lever Employees’ Union v. Hindustan Lever Ltd.
57. In Miheer H. Mafatlal v. Mafatlal Industries Ltd., the Court ruled that in cases of oppression of minority shareholders, the valuation must be:
a) Based on historical book value
b) Performed by an independent professional valuator
c) Based on the market price of shares
d) Left to the discretion of the majority shareholders
Answer: b) Performed by an independent professional valuator
58. Which case discusses the importance of the SEBI’s role in overseeing fair market pricing and valuation of securities?
a) Dinesh Vrajlal Lakhani v. Parke Davis (India) Ltd.
b) G.L. Sultania v. SEBI
c) Hindustan Lever Employees’ Union v. Hindustan Lever Ltd.
d) Dr. Mrs. Renuka Datla v. Solvay Pharmaceutical B.V.
Answer: b) G.L. Sultania v. SEBI
59. The case Brooke Bond Lipton India Ltd. (1999) involved:
a) A shareholder dispute in the valuation of shares during the takeover process
b) Corporate fraud and its effects on share pricing
c) An investigation into insider trading activities in the company
d) A dispute related to employee stock options and their valuation
Answer: a) A shareholder dispute in the valuation of shares during the takeover process
60. In Dinesh Vrajlal Lakhani v. Parke Davis (India) Ltd. (2005), the Court emphasized the use of which valuation principle?
a) The book value of shares
b) The fair market value based on independent assessments
c) The current stock market price
d) The value based on the company’s profitability
Answer: b) The fair market value based on independent assessments
61. In Hindustan Lever Employees’ Union v. Hindustan Lever Ltd. (1995), the Court ruled that the determination of share valuation during employee buyouts should be based on:
a) The book value of shares
b) Market value as listed on the stock exchange
c) Fair value determined by an independent valuer
d) The valuation provided by the company
Answer: c) Fair value determined by an independent valuer
62. In the case of Miheer H. Mafatlal v. Mafatlal Industries Ltd. (1997), the Court highlighted the importance of:
a) Using book value for determining the value of shares during a shareholder dispute
b) Market price being the determining factor for share valuation
c) Fair valuation and transparency in the process of determining the value of shares
d) Relying on stock exchange listings for the determination of share prices
Answer: c) Fair valuation and transparency in the process of determining the value of shares
63. Which case dealt with the issue of valuation during disputes involving corporate restructuring and mergers?
a) Dr. Mrs. Renuka Datla v. Solvay Pharmaceutical B.V.
b) Miheer H. Mafatlal v. Mafatlal Industries Ltd.
c) Brooke Bond Lipton India Ltd.
d) Hindustan Lever Employees’ Union v. Hindustan Lever Ltd.
Answer: c) Brooke Bond Lipton India Ltd.
64. In Dr. Mrs. Renuka Datla v. Solvay Pharmaceutical B.V., the Court discussed the fair valuation of assets in the context of:
a) Mergers and acquisitions in the pharmaceutical industry
b) Disputes over intellectual property valuation in public offers
c) Shareholder disputes regarding buyouts of shares
d) The determination of share price during market manipulation investigations
Answer: a) Mergers and acquisitions in the pharmaceutical industry
65. In the case of G.L. Sultania v. SEBI, the Court emphasized that SEBI’s responsibility includes:
a) Providing tax exemptions on securities transactions
b) Ensuring the transparency of market pricing during public offers
c) Conducting criminal investigations related to insider trading
d) Determining the valuation of assets in mergers and acquisitions
Answer: b) Ensuring the transparency of market pricing during public offers
66. In Miheer H. Mafatlal v. Mafatlal Industries Ltd., the Court ruled that in cases of oppression, the valuation of shares should be determined by:
a) The stock exchange’s closing price on the date of dispute
b) An independent valuer selected by the court
c) The company’s management based on current financial performance
d) The majority shareholders’ proposal
Answer: b) An independent valuer selected by the court
67. Which case involved a dispute over the valuation of financial assets during the liquidation of a company?
a) G.L. Sultania v. SEBI
b) Dr. Mrs. Renuka Datla v. Solvay Pharmaceutical B.V.
c) Hindustan Lever Employees’ Union v. Hindustan Lever Ltd.
d) Miheer H. Mafatlal v. Mafatlal Industries Ltd.
Answer: d) Miheer H. Mafatlal v. Mafatlal Industries Ltd.
68. Which case addressed shareholder rights and fair share valuation during corporate buyouts involving employee stock options?
a) Dinesh Vrajlal Lakhani v. Parke Davis (India) Ltd.
b) Hindustan Lever Employees’ Union v. Hindustan Lever Ltd.
c) G.L. Sultania v. SEBI
d) Miheer H. Mafatlal v. Mafatlal Industries Ltd.
Answer: b) Hindustan Lever Employees’ Union v. Hindustan Lever Ltd.
69. In Brooke Bond Lipton India Ltd. (1999), the Court dealt with the valuation of shares in the context of:
a) A financial fraud investigation
b) The sale of company shares in the open market
c) The merger of two competing companies and shareholder buyouts
d) The acquisition of assets by a private investor
Answer: c) The merger of two competing companies and shareholder buyouts
70. Which case involved the consideration of the fair market value of financial assets during a corporate merger dispute?
a) Dr. Mrs. Renuka Datla v. Solvay Pharmaceutical B.V.
b) Dinesh Vrajlal Lakhani v. Parke Davis (India) Ltd.
c) Miheer H. Mafatlal v. Mafatlal Industries Ltd.
d) Hindustan Lever Employees’ Union v. Hindustan Lever Ltd.
Answer: a) Dr. Mrs. Renuka Datla v. Solvay Pharmaceutical B.V.
71. In G.L. Sultania v. SEBI, the Court highlighted SEBI’s responsibility to ensure:
a) The integrity of market valuations in public offerings
b) The profitability of corporate entities
c) The accuracy of corporate financial statements
d) The valuation of financial assets during company liquidation
Answer: a) The integrity of market valuations in public offerings
