Partnership Act
Introduction The Indian Partnership Act, 1932 lays down the important provisions relating to partnership contracts. The subject of partnership is included in item 7 of the Concurrent List of in Seventh Schedule to the Constitution of India and therefore Parliament and Legislature of any State have power to make laws with respect to this matter as provided in Article 246 of the Constitution. According to the Section 4 of Indian Partnership Act, 1932 “Partnership is the relation between persons who have agreed to share the profits of a business carried on by all and any one acting for all.”
The essentials required for constituting a partnership firm are:- * There must be at least two persons. * There must be a relationship arising out of an agreement between two or more persons to do a business. * The agreement must be to share the profits of a business. * The business must be carried on by all or anyone acting for all.
All the four elements must be present before a group or an association can be held to be partners. It can also be said that all the afforestated elements must co-exist before a partnership can be said to come into existence.
Persons who have entered into partnership with one another are called “individuals” and collectively they are known as “firm”, and the name under which the business is carried on is called the “firm name”. As regard the “firm name”, partners have a right to carry on business with any name or style, which they choose to adopt. The partnership firm cannot use the word “Limited” as part of its name, because the liability of the firm is unlimited. The partners will sue or be sued according to the individuals’ name itself and not with firm name.
Essentials of a Partnership Firm * Association of two or more Persons: There must be a contract between two or more persons who must be competent to enter into contract. They may be natural or artificial persons in partnership firm. The artificial
The essentials required for constituting a partnership firm are:- * There must be at least two persons. * There must be a relationship arising out of an agreement between two or more persons to do a business. * The agreement must be to share the profits of a business. * The business must be carried on by all or anyone acting for all.
All the four elements must be present before a group or an association can be held to be partners. It can also be said that all the afforestated elements must co-exist before a partnership can be said to come into existence.
Persons who have entered into partnership with one another are called “individuals” and collectively they are known as “firm”, and the name under which the business is carried on is called the “firm name”. As regard the “firm name”, partners have a right to carry on business with any name or style, which they choose to adopt. The partnership firm cannot use the word “Limited” as part of its name, because the liability of the firm is unlimited. The partners will sue or be sued according to the individuals’ name itself and not with firm name.
Essentials of a Partnership Firm * Association of two or more Persons: There must be a contract between two or more persons who must be competent to enter into contract. They may be natural or artificial persons in partnership firm. The artificial