CA Foundation Jan 2027 Law mock test: important questions
A CA Foundation Jan 2027 Law mock test should follow ICAI's Paper 2 slot by slot: six questions of 20 marks, each in three parts, Question 1 compulsory plus any four of the other five, in 3 hours. The questions ICAI repeats are offer and acceptance, sale on approval and the unpaid seller, classes of companies and the corporate veil, the essentials of a promissory note, bill and cheque, and one LLP and one Regulatory Framework part every time. Write every case as provision, application to the facts, conclusion.
Business Laws is Paper 2. The Foundation papers are on 3, 5, 7 and 9 January 2027 (ICAI schedule, PDF (opens in a new tab)); ICAI's Guidance Notes put Business Laws on Tuesday 5 January (Guidance Notes for Foundation, January 2027, on icai.org, PDF (opens in a new tab))., Law is on 5 January. Below: the pattern, the slot map ICAI has used twice in a row, the important questions, what ICAI's examiners said students get wrong, the small company change for January 2027 and a 3-hour plan.
CA Foundation Business Laws paper pattern for Jan 2027
Paper 2 is fully descriptive: 100 marks, 3 hours, 15 minutes of reading time from 1:45 PM, no MCQs and no negative marking.
| Paper 2: Business Laws | |
|---|---|
| Time | 2 to 5 PM, reading time from 1:45 PM |
| Questions | 6 × 20 marks; Question 1 compulsory, then any 4 of Questions 2 to 6 |
| Parts | Three per question: 7 + 7 + 6 marks (Question 6: 7 + 6 + 7) |
| Choice inside a question | Only one: Question 6(b), 6 marks, an OR between two Contract theory questions |
| Cover instruction | "Working notes should form part of the answers." |
Sources: ICAI's Paper 2, September 2026 (PDF) (opens in a new tab) and the January 2027 schedule (PDF) (opens in a new tab). Nothing ICAI has published for January 2027, including the RTP, changes this. All four papers' formats are in CA Foundation exam pattern and marking.
The slot map: which Act sits where
May and September 2026 used the same blueprint, question by question. January 2026 differed by one 6-mark part. This is the September 2026 map:
| Question | (a) 7 marks | (b) 7 marks | (c) 6 marks |
|---|---|---|---|
| 1 | Contract case | Companies case | Partnership theory |
| 2 | Sale of Goods case | Companies theory | LLP theory |
| 3 | Partnership case with a calculation | Companies case | Contract theory |
| 4 | Contract case with a calculation | Negotiable Instruments theory | Indian Regulatory Framework |
| 5 | Sale of Goods case | Partnership advice | Contract theory |
| 6 | Negotiable Instruments case | Contract theory, OR (6 marks) | Sale of Goods theory (7 marks) |
Counted in printed marks (120, because you answer 100), that is Contract 32, Sale of Goods 21, Companies 21, Partnership 20, Negotiable Instruments 14, LLP 6 and the Regulatory Framework 6. The year-by-year counts are in our CA Foundation Jan 2027 chapter wise weightage.
Calculations now sit inside law questions. In September 2026, Question 4(a) ended "You are required to provide the calculation for the same", and two cases also needed figures: a retired partner's share in Question 3(a) and a loss or profit on resale in Question 5(a). Practise writing the figure as a short working note under the conclusion.
CA Foundation Law important questions, Act by Act
These are the topics that came up in two or three of ICAI's three 2026 papers:
- Indian Contract Act, 1872: offer, acceptance and revocation (Question 1(a), a 7-mark case, every time); consideration and the exceptions to "a stranger to a contract cannot sue"; contract of guarantee and the surety's rights; breach, damages and penalty; void agreements.
- Sale of Goods Act, 1930: sale on approval or on sale or return; the unpaid seller's rights; conditions, warranties and caveat emptor; passing of property.
- Companies Act, 2013: lifting the corporate veil and the One Person Company; indoor management and constructive notice; classes of companies, including private, small, government and Section 8 companies.
- Indian Partnership Act, 1932: the test of partnership; a partner's implied authority; dissolution, retirement and the rights of an outgoing partner.
- Negotiable Instruments Act, 1881: the essentials of a promissory note, a bill and a cheque; negotiation and presentment; dishonour.
- LLP Act, 2008: Question 2(c) every time; the topic rotates (registered office, minimum partners, names, designated partners, small LLP).
- Indian Regulatory Framework: Question 4(c) every time: regulators such as RBI and IBBI (January), common law and natural justice (May), the Ministry of Home Affairs (September).
ICAI's papers are on our CA Foundation past year question papers page. Which older Law answers use limits that have since changed is in CA Foundation suggested answers May 2026 PDF.
Common mistakes ICAI's examiners pointed out
ICAI's suggested answers for January 2026 (PDF) (opens in a new tab) and May 2026 (PDF) (opens in a new tab) end with examiners' comments on Paper 2. One warning comes up again and again.
"Generalized" answers. In January 2026, "many examinees resorted to answering the question in a generalized manner, rather than in accordance with the relevant provisions of law" (Q1(a)). In May 2026, "Many examinees provided generalized answers instead of analysing the facts in the light of the relevant legal provisions" (Q1(a)). The same word appears in their comments on Partnership, Sale of Goods, the Regulatory Framework and Negotiable Instruments.
The specific gaps they named:
| What the examiners found | Paper | What to practise |
|---|---|---|
| Could not answer with reference to Section 6 (revocation of an offer) | Jan 2026, Q1(a) | Revocation timing in every Question 1(a) |
| Could not explain that an OPC is a legal person separate from its members, with their liability limited to the nominal value of their shares | Jan 2026, Q1(b) | Separate legal entity in your own words, then the section |
| "unable to state the provisions of Section 6" of the LLP Act (minimum partners) | Jan 2026, Q2(c) | LLP basics: partners, designated partners, registered office |
| Could not state Section 25 (agreement without consideration) and apply it | Jan 2026, Q4(a) | The exceptions to "no consideration, no contract" |
| Did not give "the correct number of days" for a complaint after a cheque is dishonoured | Jan 2026, Q6(a) | Section 138 timelines, in order |
| Did not reach the conclusion that property had passed under a sale on approval | May 2026, Q2(a) | Sale on approval cases to a written conclusion |
| Explained equity versus preference shares when the question asked how equity shares with differential voting rights differ from preference shares | May 2026, Q2(b) | Answer the exact term asked |
| Identified the surety's rights but "failed to correctly compute the surety's liability" | May 2026, Q4(a) | Calculations inside guarantee cases |
| Confused a self-drawn and self-accepted bill of exchange | May 2026, Q6(a) | Validity of unusual instruments |
How to write a law answer: a worked example
Facts (written by us): Ravi sells his bakery in Pune, with its goodwill, to Sana, who continues to run it. He agrees not to run a bakery within 2 km of the shop for three years. A year later he opens one 1 km away. Sana sues. Is Ravi's promise valid?
- Provision: Under Section 27 of the Indian Contract Act, 1872, an agreement restraining a person from carrying on a lawful trade or business is void to that extent. An exception applies where a person sells the goodwill of a business and agrees with the buyer to refrain from carrying on a similar business within specified local limits, so long as the buyer (or his successor in interest) carries on a like business there, provided the limits are reasonable.
- Application: In the given case, Ravi sold the goodwill of his bakery to Sana and agreed not to run a similar business within 2 km for three years. Sana still runs the bakery, and a 2 km, three-year limit is reasonable for a local bakery.
- Conclusion: The agreement falls within the exception to Section 27 and is valid. Sana can enforce it against Ravi.
The source of the rule is ICAI's study material, Chapter 2. Three short parts, each in its own paragraph, is the layout ICAI's own suggested answers use. How each part earns marks is in step marking in CA exams. Five real ICAI cases worked the same way are in CA Foundation law case study questions and answers.
What applies for CA Foundation Law in January 2027
- Study material: Business Laws, August 2024 edition (Reprint August 2025 onwards), plus the RTP for January 2027 (ICAI notice, PDF (opens in a new tab)). The January 2027 RTP is out on ICAI's Foundation RTP page (opens in a new tab); its Part I lists the amendments for January 2027 (RTP Paper 2, January 2027, PDF (opens in a new tab)).
- Small company limits (Companies Act, Section 2(85)): ICAI's RTPs for September 2026 and January 2027 list Notification G.S.R. 880(E) of 1 December 2025: a small company is one whose paid-up capital does not exceed ₹10 crore and whose turnover does not exceed ₹100 crore (RTP Paper 2, September 2026, PDF (opens in a new tab)). The August 2024 study material (Reprint August 2025) that applies for January 2027 still prints ₹4 crore and ₹40 crore. A public company, a holding or subsidiary company, a Section 8 company and a company governed by a special Act cannot be a small company.
- In the January 2027 RTP, read the amendments part first: for Business Laws it lists only this small company change.
How to keep amendments straight across papers is in how to revise amendments for CA exams.
How to attempt the CA Foundation Law paper in 3 hours
| Time | What to do |
|---|---|
| 1:45 to 2:00 PM | Read all six questions. Pick your four from Questions 2 to 6 and your option in 6(b). Mark the sub-questions in each case |
| 2:00 to 2:34 PM | Question 1 |
| 2:34 to 4:50 PM | Your four questions, about 34 minutes each |
| 4:50 to 5:00 PM | Check that every sub-question, (i), (ii) and (iii), has its own conclusion |
- Answer each sub-question separately. A case with three asks has three conclusions.
- Cite the Act and section in the first line of the provision.
- For "any six" theory questions, write six numbered points, one or two lines each.
How our 3 Law mocks help
Our CA Foundation Business Laws mocks are three full papers on the September 2026 slot map above, so each one carries the same Act-wise weight as ICAI's September 2026 paper.
- Every mock: a Contract case on offer and acceptance in Question 1(a); an LLP part in Question 2(c); a Regulatory Framework part in Question 4(c); calculations inside law cases; one OR in Question 6(b).
- Across the three: capacity, free consent, void agreements, discharge, damages, indemnity and guarantee, bailment and agency; conditions and warranties, passing of property, sale on approval, transfer of title by a non-owner, the unpaid seller and auction sales; partnership retirement, dissolution and holding out; the small company with the new limits, OPC, corporate veil, MOA, AOA, ultra vires and indoor management; promissory notes, presentment, and dishonour of a cheque under Section 138.
- Written like ICAI's: dated facts, named parties, and a twist or a wrong contention in each case to test your reasoning, with ICAI's requirement lines.
You write by hand, scan and upload one PDF. Your checked copy comes back within 24 hours with ICAI-style step-wise marks, the reason for every mark cut and the correct line to write, plus detailed suggested answers with the provisions. You can read preview pages of Mock 1 on the plan page before you buy. When to write each mock is in our CA Foundation Jan 2027 mock test plan.
Frequently asked questions
Is there negative marking in CA Foundation Law?
No. Paper 2 is fully descriptive. Negative marking applies only to the MCQ papers, Quantitative Aptitude and Business Economics.
Which Act carries the most marks in CA Foundation Business Laws?
The Indian Contract Act: 26 to 32 of the 120 printed marks in ICAI's 2026 papers, including the compulsory Question 1(a) case every time.
What are the small company limits for CA Foundation Jan 2027?
Paid-up capital up to ₹10 crore and turnover up to ₹100 crore, from Notification G.S.R. 880(E) of 1 December 2025, as listed in ICAI's RTPs for September 2026 and January 2027 (RTP Paper 2, January 2027, PDF (opens in a new tab)).
How long should a 7-mark law answer be?
Long enough for all three parts: the provision with its section, the application to each fact in the case, and a conclusion for each sub-question. In a 3-hour paper, that is about 12 minutes of writing.
Where can I get CA Foundation Law mock test papers?
ICAI's MTPs, RTPs and past papers are free on our CA Foundation free resources page. New full papers with a checked copy are on our CA Foundation Business Laws page.
Write one full Law paper this month
Take ICAI's September 2026 paper, write it in 3 hours and check each case for the three parts. Then move to full mocks from late November. Our CA Foundation test series has CA mock tests for all four papers, and every level is on the CA test series home page. The other papers: Accounts, Maths and Economics.