Answer: B
Soln:
Central Bureau of Investigation (CBI):
● The Central Bureau of Investigation (CBI) traces its origins to the Special Police
Establishment, a Central Government Police force, which was set up in 1941 by the British
to investigate bribery and corruption.
● In 1963, the Home Ministry expanded its power and changed its name to the Central
Bureau of Investigation. It is governed by the Delhi Special Police Establishment Act
(DSPE), 1946. Hence, statement 1 is correct.
● The CBI was established with a view to investigate serious crimes related to Defence of
India, corruption in high places, serious fraud, cheating and embezzlement and social crime,
particularly of hoarding, black-marketing and profiteering in essential commodities, having
all-India and inter-state ramifications.
● CBI acts as an interface between the law enforcement agencies of India and other countries
to ensure cooperation. It facilitates exchange and sharing of information by these agencies.
● The superintendence of CBI related to investigation of offences under the Prevention of
Corruption Act, 1988 lies with the Central Vigilance Commission (CVC) and in other
matters with the Department of Personnel & Training (DOPT) in the Ministry of
Personnel, Pension & Grievances.
CBI Director:
● The Lokpal and Lokayuktas Act, 2013 governs the appointment of the CBI director.
● The CBI director is appointed by the Centre on the basis of the recommendation of a search
committee comprising:
○ the Prime Minister as the chairperson,
○ the Chief Justice of India and
○ the Leader of Opposition.

Requirement of Consent
● The DSPE Act grants the CBI power to investigate a case in Delhi, without any
permission, since it is part of the Centre.
● However, in all the states, the CBI needs the consent of the state to investigate any case
relating to that state or having jurisdiction of that state.
● The Central police cannot investigate or enter the state without the consent since police
and public order are state subjects and the Centre cannot intervene in law and order
matters.
● The CBI can initiate suo motu investigations only in Union Territories, under the DSPE Act.
● The Supreme Court and High Courts, however, can order the CBI to investigate such a
crime anywhere in the country without the consent of states.
Types of consent
● There are two kinds of consent: case-specific and general.
○ “General consent” is normally given to help the CBI seamlessly conduct its
investigation into cases of corruption against central government employees in the
concerned state. Hence, statement 2 is correct.
○ Otherwise, the CBI would require consent in every case.
● When a state withdraws its general consent, the CBI will not be able to register any fresh case involving a central government official or a private person stationed in such states without getting case-specific consent.

● However, there will be no bar on investigation into cases that are already being probed by the CBI. The CBI cannot file any new FIRs in any new cases. Hence, statement 3
is incorrect.

5. Consider the following statements about the ‘Nirbhaya Fund’.
1. The fund can be utilised for projects specifically designed to improve the safety and security of women.
2. It is a non-lapsable corpus fund.
3. The Ministry of Women & Child Development is the only Ministry associated with the fund.

Answer: A
Soln:
Nirbhaya Fund:
● Nirbhaya Fund is a dedicated fund set up by the Government of India in 2013 which can be
utilised for projects specifically designed to improve the safety and security of women.
Hence, statement 1 is correct.
● It is a non-lapsable corpus fund administered by the Department of Economic Affairs of
the Ministry of Finance. Hence, statement 2 is correct.
● As per this framework, the Ministry of Finance through the Department of Economic
Affairs is the nodal Ministry for any accretion into and withdrawal from the corpus, and the
Ministry of Women & Child Development is the nodal authority for appraisal of the
schemes/proposals received under Nirbhaya Fund. Hence, statement 3 is incorrect.
● The proposed projects under the Nirbhaya Fund should have the following features:
○ Direct impact on safety and security concerns of women
○ Optimum use of existing infrastructure
○ Innovative use of technology
○ No duplication of existing government schemes/programmes
○ Provision for real time intervention as far as possible.
● Note: Funding to Non-Governmental Organisations is not envisaged under the framework.

1. Consider the following statements about Unlawful Activities (Prevention) Amendment Act,
2019
1) It empowers both the central and state government to designate an individual a “terrorist”
if they are found committing an act of terror.
2) It requires any investigating officer to take prior permission of the Director General of
Police of a state for conducting raids.

Answer: D
Explanation
● The Unlawful Activities (Prevention) Amendment Act, 2019 was passed by the Parliament
in 2019. It amends the Unlawful Activities (Prevention) Act, 1967.
● Statement 1 is incorrect: The amendment act empowers the central government to
designate an individual a “terrorist” if they are found committing, preparing for,
promoting, or involved in an act of terror. Earlier, the Central Government was having
powers only to designate organizations as terrorist organizations.
● The UAPA law of 1967 requires an investigating officer to take prior permission of the
Director General of Police of a state for conducting raids, and seizing properties that are
suspected to be linked to terrorist activities.
● The amendment act of 2019 however, removes this requirement if the investigation is
conducted by an officer of the National Investigation Agency (NIA). The investigating
officer, under the 2019 act, only requires sanction from the Director General of NIA.
Hence statement 2 is incorrect.
○ Central agencies such as the Central Bureau of Investigation (CBI) are required
to obtain prior permission from the state government since law and order is a
state subject under the Constitution.

● The UAPA law of 1967 specifies that only officers of the rank of Deputy Superintendent or
Assistant Commissioner of Police of the NIA shall have the power to investigate offenses
under the UAPA law. The amendment act seeks to allow NIA officers of Inspector rank to
carry out investigations.
Why in News?
● A tribunal under the Unlawful Activities (Prevention) Act (UAPA) has upheld the Centre’s
decision to declare seven valley based Meitei extremist organizations as “unlawful
associations” for the next five years.
What is a UAPA tribunal?
● The UAPA provides for a tribunal under a High Court judge to be constituted by the
government for its bans to have long-term legal sanctity.
● Orders to declare an organization as “unlawful” are issued by the Centre under the UAPA. A
government order would not come into effect until the tribunal has confirmed it.
○ However, in exceptional circumstances, the notification can come into effect
immediately once the reasons for it are recorded in writing. The tribunal can
endorse or reject it.

● The tribunal consists of only one person, who has to be a High Court judge.

● The Centre is to provide to the tribunal such staff as necessary for the discharge of its
functions. All expenses incurred for a tribunal are borne out of the Consolidated Fund of
India.
● The tribunal has power to regulate its own procedure, including the place at which it
holds its sittings.
● To make inquiries, the tribunal has the same powers as vested in a civil court under the
Code of Civil Procedure, 1908.
○ These can be exercised in summoning a witness and examining him on oath;
production of any document or other material object producible as evidence; the
reception of evidence on affidavits; the requisitioning of any public record from any
court or office; and the issuing of any commission for the examination of witnesses.

● All proceedings before the Tribunal are deemed to be judicial proceedings.

2. Which of the following statements is correct about Sensex?

Answer: B
Explanation
● Launched in 1986, the Sensex is the country’s oldest and most tracked index. It is
designed to measure the performance of the 30 largest, most liquid, and financially
sound companies across key sectors of the Indian economy that are listed at BSE Ltd.
Among the companies that are part of the Sensex are Reliance Industries, ICICI Bank, and
ITC Ltd.
● These companies are selected to represent the broader Indian equity marketplace. As such,
even though the Sensex is composed of only 30 stocks, investors make decisions to buy or
sell based on the movement of the Sensex.
● The total market capitalisation, or the total value of all listed shares, of BSE-listed firms is
Rs 419.99 lakh crore (May 24).
And how is Nifty different from Sensex?
● The difference lies in the number of stocks that each index tracks. While the Sensex
constitutes 30 companies trading on the BSE, the Nifty 50 is a broad-based index
consisting of 50 blue chip large and liquid stocks traded on the National Stock
Exchange of India (NSE).
● The Nifty 50 was started in 1995. It includes companies such as Adani Enterprises, Bajaj
Finance, and Coal India.
● The market capitalisation of NSE firms is Rs 416.04 lakh crore (May 24).
How are companies selected in Sensex?
● To be considered for selection, a stock must satisfy certain requirements. The Sensex is
reconstituted biannually, in June and December of every year.
● It must have a listing history of at least six months at BSE, and it should have traded on
every trading day at the BSE during this six-month reference period.
● To be eligible, the stock should have a derivative contract, that is, an agreement between
two parties to buy or sell any form of security at a certain price in the future.

○ A derivative is a financial instrument whose value is based on the value of an
underlying asset like equities and currency.

● The company must be among the top 75 companies based on their average three-month
float or total market cap.
● It should have a minimum free-float market cap of 0.50% after market cap and liquidity
criteria are met.
● In terms of liquidity, the cumulative weight of the three-month average daily value traded (ADVT) is calculated for companies that meet the eligibility requirements. Any prospective constituents with a total weight of ADVT greater than 98% are excluded from the index.
Why in News?
● Adani Ports and Special Economic Zone Ltd (APSEZ) is set to be included in the Sensex at the Bombay Stock Exchange, replacing Wipro.

3. Consider the following statements about the Karman Line:
1) It is the internationally recognized boundary between Earths atmosphere and outer space.
2) It is located approximately 100 kilometers above mean sea level.

Answer: C
Explanation
● The Karman line is a boundary 62 miles (100 kilometers) above mean sea level that borders Earths atmosphere and the beginning of space. Hence, statement 2 is correct.
● It is widely accepted as the boundary line separating the Earth’s atmosphere from outer space. Hence, statement 1 is correct.
● The line is named after Hungarian American engineer and physicist Theodore von
Karman.

4. With reference to the Insolvency and Bankruptcy Code (IBC), consider the following statements.
1. Insolvency is a situation where individuals or companies are unable to repay their outstanding debt.
2. The minimum amount of default after which the creditor or debtor could apply for insolvency is ₹1 lakh.
3. The Debt Recovery Tribunal adjudicates insolvency resolutions for individuals and partnership firms.
4. Amendments to IBC mandate a deadline for the completion of the resolution process within
330 days.

Answer: C
Explanation:
● Statement 1 is correct: Insolvency is a situation where individuals or companies are
unable to repay their outstanding debt.
● The Insolvency and Bankruptcy Code (IBC) provides a time-bound process for resolving the
insolvency of corporate debtors called the corporate insolvency resolution process
(CIRP).
● Statement 2 is incorrect: Earlier, the minimum amount of default after which the
creditor or debtor could apply for insolvency was ₹1 lakh, but considering the stress on
companies amid the covid pandemic, the government increased the minimum amount to ₹1
crore.
● Under CIRP, a committee of creditors is constituted to decide on the insolvency resolution.
The committee may consider a resolution plan which typically provides for the payoff of
debt by merger, acquisition, or restructuring of the company.
● If a resolution plan is not approved by the committee of creditors within the specified time,
the company is liquidated (the assets of the borrower will be sold to repay creditors).
● During CIRP, the affairs of the company are managed by the Resolution Professional (RP),
who is appointed to conduct CIRP.
● Statement 3 is correct: The National Company Law Tribunal (NCLT) adjudicates
insolvency resolutions for companies and Limited Liability Partnerships.  The Debt
Recovery Tribunal (DRT) adjudicates insolvency resolution for individuals and
partnership firms.
● The Insolvency and Bankruptcy Board of India (IBBI) regulates the functioning of IPs,
IPAs and IUs.
● Statement 4 is correct: The code was amended in 2019 which mandated a deadline for the
completion of the resolution process within 330 days, including all litigation and
judicial processes. 
Insolvency and Bankruptcy Code (Amendment) Act, 2021
● In 2021, the Parliament passed the Insolvency and Bankruptcy Code (Amendment) Act,
2021 to expedite and provide an efficient alternate insolvency resolution process for
corporate persons classified as micro, small and medium enterprises (MSMEs) under
IBC.
Highlights of the Act

Pre-packaged insolvency resolution
● The Act introduces an alternate insolvency resolution process for MSMEs, called the
pre-packaged insolvency resolution process (PIRP).
● Unlike CIRP, PIRP may be initiated only by debtors. The debtor should have a base
resolution plan in place.
● During PIRP, the management of the company will remain with the debtor.
Minimum default amount
● Application for initiating PIRP may be filed in the event of a default of at least one lakh rupees. Debtors eligible for PIRP
● PIRP may be initiated in the event of a default by a corporate debtor classified as an MSME under the MSME Development Act, 2006.
○ Currently, under the 2006 Act, an enterprise with an annual turnover of up to Rs 250 crore, and investment in plant and machinery or equipment up to Rs 50
crore, is classified as an MSME.

5. Consider the following statements.
1. Foreign Direct Investment (FDI) is a source of capital in the primary market.
2. Foreign Portfolio Investment (FPI) is considered to be more stable than FDI.
3. A major differentiating factor between FDI and FPI is that FPI has the element of control in which investors actively manage and influence a foreign firm’s operations.

Answer: A
Explanation:
FDI
● Foreign Direct Investment (FDI) is the investment made by a person or a company in
one country into businesses located in another country.
● Generally, FDI takes place when an investor establishes foreign business operations or
acquires foreign business assets.
● FDI is an investment made in the form of equity capital, reinvested earnings or other
direct capital by setting up an enterprise.
● FDI enables setting up of businesses; more businesses mean more jobs and capacity
addition.
● Statement 1 is correct: In other words, FDI is a source of capital in the primary market and
this capital gets converted into goods and services.
● Statement 3 is incorrect: The key to foreign direct investment is the element of control.
Control represents the intent to actively manage and influence a foreign firm’s operations.
This is the major differentiating factor between FDI and a passive foreign portfolio
investment.
FPI
● Foreign Portfolio Investment (FPI) means investing in the financial assets of a foreign
country, such as stocks or bonds available on an exchange.

● FPI is often referred to as “hot money” because of its tendency to flee at the first signs of
trouble in an economy.
Why is FDI preferred?
● Statement 2 is incorrect: FDI is considered a more stable form of foreign capital
infusion as it brings in a certain expenditure that can’t be pulled out overnight.
● It creates jobs and can potentially aid economic growth.
● FPI, on the other hand, can come and go easily. Sudden withdrawal can create liquidity
problems in the securities market and hit the foreign exchange rate of the country.

1. Consider the following statements about the Prasat Ta Muen Thom archeological site recently
seen in the news.
1. The site is located in the Myanmar-Thailand border region.
2. It has Buddhist and Hindu religious shrines.