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CS Professional · Environmental, Social and Governance (ESG) - Principles and Practice · Business Ethics, Code of Conduct and Anti-Bribery

Kaveri Textiles LLP is a partnership firm formed in India carrying on business only in Bangladesh. Its employee bribes a foreign official there... Consider only the question of whether the firm is a 'commercial organisation' under Section 9(3). Which is correct?

The firm is a commercial organisation. The Act covers a partnership firm or association of persons formed in India that carries on business whether in India or outside India. The requirement of carrying on part of the business in India applies only to bodies formed outside India.

  1. AIt is not, because its business is carried on outside India
  2. BIt is, because a partnership firm formed in India carrying on business in India or outside India qualifiesCorrect
  3. CIt is not, because only bodies incorporated under company law qualify
  4. DIt is, only if it also carries on part of its business in India

Explanation

Section 9(3)(a)(iii) covers a partnership firm or association of persons formed in India carrying on a business whether in India or outside India. The 'part of business in India' requirement applies only to bodies formed outside India. So the firm qualifies.

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