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    Indian Partnership Act, 1932

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    ghostylife
    The Indian Partnership Act of 1932 defines a partnership as the relation between persons who have agreed to share the profits of a business carried on by all or any of them. Key provisions include that a partnership arises from contract, not status; that every partner has a right to participate in conducting business and access business records; and that partners share profits equally but can agree to different profit/loss sharing or interest on capital contributions. The Act also establishes requirements for registering partnerships to allow partners to enforce contractual rights.

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    Indian Partnership Act, 1932

    Uploaded by

    ghostylife
    20 views12 pages
    The Indian Partnership Act of 1932 defines a partnership as the relation between persons who have agreed to share the profits of a business carried on by all or any of them. Key provisions include that a partnership arises from contract, not status; that every partner has a right to participate in conducting business and access business records; and that partners share profits equally but can agree to different profit/loss sharing or interest on capital contributions. The Act also establishes requirements for registering partnerships to allow partners to enforce contractual rights.

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    Partnership

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    The Indian Partnership Act of 1932 defines a partnership as the relation between persons who have agreed to share the profits of a business carried on by all or any of them. Key provisions include that a partnership arises from contract, not status; that every partner has a right to participate in conducting business and access business records; and that partners share profits equally but can agree to different profit/loss sharing or interest on capital contributions. The Act also establishes requirements for registering partnerships to allow partners to enforce contractual rights.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as PPT, PDF, TXT or read online from Scribd
    Download as ppt, pdf, or txt
    20 views12 pages

    Indian Partnership Act, 1932

    Uploaded by

    ghostylife
    The Indian Partnership Act of 1932 defines a partnership as the relation between persons who have agreed to share the profits of a business carried on by all or any of them. Key provisions include that a partnership arises from contract, not status; that every partner has a right to participate in conducting business and access business records; and that partners share profits equally but can agree to different profit/loss sharing or interest on capital contributions. The Act also establishes requirements for registering partnerships to allow partners to enforce contractual rights.

    Copyright:

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    Download as PPT, PDF, TXT or read online from Scribd
    Download as ppt, pdf, or txt
    of 12

    INDIAN PARTNERSHIP ACT, 1932

    • Preamble: An Act to define and amend the law


    relating to partnership.

    • Contains 74 sections divided into VII chapters


    and one Schedule (fee for copies of documents
    etc.)
    What is “partnership”?
    • Sec.4. "Partnership" is the relation between
    persons who have agreed to share the profits of
    business carried on by all or any of them acting
    for all.
    • Partners & Firm:
    • Persons who have entered into partnership with
    one another are called individually "partners"
    and collectively "a firm", and the name under
    which their business is carried on is called the
    "firm name".
    Partnership not created by status.

    • Sec. 5. The relation of partnership arises from


    contract and not from status; and, in particular,
    the members of a Hindu undivided family
    carrying on a family business as such, or a
    Burmese Buddhist husband and wife carrying on
    business as such are not partners in such
    business.
    The conduct of the business

    • Sec. 12. Subject to contract between the partners—


    • (a) every partner has a right to take-part in the conduct of the
    business;
    • (b) every partner is bound to attend diligently to his duties in the
    conduct of the business;
    • (c) any difference arising as to ordinary matters connected with
    the business may be decided by majority of the partners, and every
    partner shall have the right to express his opinion before the matter
    is decided, but no change may be made in the nature of the
    business without the consent of all the partners; and
    • (d) every partner has a right to have access to and to inspect and
    copy any of the books of the firm.
    Mutual rights and liabilities

    • Sec. 13. Subject to contract between the partners—


    • (a) a partner is not entitled to receive remuneration for
    taking part in the conduct of the business;
    • (b) the partners are entitled to share equally in the profits
    earned, and shall contribute equally to the losses
    sustained by the firm;
    • (c) where a partner is entitled to interest on the capital
    subscribed by him such interest shall be payable only out
    of profits;
    • (d) a partner making, for the purposes of the business,
    any payment or advance beyond the amount of capital he
    has agreed to subscribe, is entitled to interest thereon at
    the rate of six per cent per annum;
    • (e) the firm shall indemnify a partner in respect of
    payments made and liabilities incurred by him—
    • (i) in the ordinary and proper conduct of the business,
    and
    • (ii) in doing such act, in an emergency, for the purposes
    of protecting the firm from loss, as would be done by a
    person of ordinary prudence, in his own case, under
    similar circumstances; and
    • (f) a partner shall indemnify the firm for any loss caused
    to it by his willful neglect in the conduct of business of
    the firm.
    Registration of Firms
    • Application for registration.
    • Sec. 58. (1) The registration of a firm may be effected at any time by
    sending by post or delivering to the Registrar of the area in which
    any place of business of the firm is situated or proposed to be
    situated, a statement in the prescribed form and accompanied by
    the prescribed fee, stating—
    • (a) the firm name,
    • (b) the place or principal place of business of the firm,
    • (c) the names of any other places where the firm carries on
    business,
    • (d) the date when each partner joined the firm,
    • (e) the names in full and permanent addresses of the partners, and
    • (f) the duration of the firm.
    • The statement shall be signed by all the partners, or by
    their agents specially authorised in this behalf.
    • (2) Each person signing the statement shall also verify it
    in the manner prescribed.
    • (3) A firm name shall not contain any of the following
    words, namely:—
    • "Crown", "Emperor", "Empress", "Empire", "Imperial",
    "King", "Queen", "Royal", or words expressing or
    implying the sanction, approval or patronage of
    Government, except when the State Government
    signifies its consent to the use of such words as part of
    the firm name by order in writing.
    • Registration.
    • 59. When the Registrar is satisfied that the
    provisions of section 58 have been duly
    complied with, he shall record an entry of
    statement in a register called the Register
    of Firms, and shall file the statement.
    Effect of non-registration

    • Sec. 69. (1) No suit to enforce a right arising from a contract or


    conferred by this Act shall be instituted in any court by or on
    behalf of any person suing as a partner in a firm against the
    firm or any person alleged to be or to have been a partner in
    the firm unless the firm is registered and the person suing is or
    has been shown in the Register of Firms as a partner in the
    firm.

    • (2) No suit to enforce a right arising from a contract shall be


    instituted in any court by or on behalf of a firm against any
    third party unless the firm is registered and the persons suing
    are or have been shown in the Register of Firms as partners in
    the firm.
    • (3) The provisions of sub-sections (1) and (2) shall apply also to
    a claim of set-off or other proceeding to enforce a right arising
    from a contract, but shall not effect—

    • (a) the enforcement of any right to sue for the dissolution of a


    firm or for accounts of a dissolved firm, or any right or power
    to realise the property of a dissolved firm, or

    • (b) the powers of an official assignee, receiver or court under


    the Presidency-towns Insolvency Act, 1909 (2 of 1909), or the
    Provincial Insolvency Act, 1920 (5 of 1920), to realise the
    property of an insolvent partner.

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