MEANING AND CONTENTS OF PARTNERSHIP DEED

Partnership firm can be established a!reement ma# be ith an a!reement bet een the partners" This ritten $r $ral" An $ral a!reement ma# be the ca%se $f disp%te in ritten a!reement in $rder t$ a'$id f%t%re c$nflicts" The

f%t%re" S$& it is better t$ ha'e a

ritten a!reement d%l# si!ned b# the partners is (n$ n as partnership deed $r a!reement $r Articles $f Partnership" It is the ritten c$ntract bet een partners" It

c$ntains the term and c$nditi$ns $f the partnership"

Partnership deed f$rms the basis $f partnership" Partnership deed is a d$c%ment c$ntainin! all the matters acc$rdin! t$ hich m%t%al ri!hts& d%ties and liabilities $f

the partners in the c$nd%ct and mana!ement $f the affairs $f the firm are determined" Hence& it c$ntains the terms and c$nditi$ns $f thepartnership" It is helpf%l in pre'entin! and res$l'in! disp%tes am$n! thepartners" A partnership deed can be altered at an# time ith the c$nsent $f all the partners"

The past e)periences $f partnership firms sh$

that there are disp%tes

am$n!partners $'er man# thin!s and these res%lts in the cl$s%re $f the firm" If the areas $f disp%te $r c$nflict are sp$tted earlier and a clear %nderstandin! is reached& then the b%siness can r%n sm$$thl#" S$& partnership deed $r a!reement is a d$c%ment hich is

prepared t$ e)plain imp$rtant p$ints s$ that the chances $f c$nflict are minimi*ed" E'en if there is a disp%te it helps in easier settlement" S$& ritten deed sh$%ld be preferred"

Main C$ntent $f Partnership Deed

S$me $f the imp$rtant cla%ses t$ be incl%ded in a partnership deed are as f$ll$ s+

,-. Name $f the firm and Its Address + The deed sh$%ld c$ntain $f the firm and place $f its b%siness"

,/. Name and Address $f Partners + The deed sh$%ld als$ c$ntains the names and address $f all partners"

,0. Nat%re $f Firm1s 2%siness + The nat%re $f b%siness pr$p$sed t$ be carried and its limitati$n sh$%ld be incl%ded in it"

,3. D%rati$n $f Partnership + It the partnership is established f$r a fi)ed d%rati$n $r f$r a fi)ed $r(& it sh$%ld be stated in it"

,4. Partners1 Capitals + The deed sh$%ld c$ntain the t$tal am$%nt $f capital and c$ntrib%ti$ns b# each partner"

,5. Interest $n Capital + If the partners decide t$ chan!e interest $n their capitals& the rate sh$%ld be menti$ned in the deed"

,6. Dra in! and Interest $n Them + The deed sh$%ld c$ntain the limit $f dra in!s b# e'er# partner and the rate $f interest t$ be char!ed"

,7. Di'isi$n $f Pr$fit + Pr$fit and l$ss sharin! rati$ sh$%ld be stated in the deed" If it is n$t menti$ned partners are a%th$ri*ed t$ share e8%all# acc$rdin! t$ Partnership Act"

,9. Partners1 Salar# and C$mmissi$n + If the partners decide t$ pa# salar# and c$mmissi$n t$ the partners& the deed sh$%ld c$ntain the am$%nt $f salar# $r c$mmissi$n pa#able t$ an# partner f$r the ser'ices rendered t$ the b%siness"

,-:. Ri!hts and D%ties $f Partners + If an# partner has s$me special ri!hts and d%ties re!ardin! t$ c$nd%cts $f b%siness $r if the liabilit# $f an# partner is limited t$ the capital in'ested b# him& these facts sh$%ld als$ be menti$ned in it"

,--. Admissi$n and Retirement $f Partners ; After the establishment $fpartnership s$me ne partners ma# be admitted and s$me ma# retire fr$m the

b%siness" If an# definite pr$ced%re is t$ be ad$pted at the time $f admissi$n $r retirement $f partner& it sh$%ld be stated in it"

,-/. Death $f a Partner + The pr$ced%re $f calc%latin! the am$%nt d%e t$ a deceased partner and the meth$d $f its pa#ment t$ his s%ccess$rs& sh$%ld als$ be decided and stated in the deed"

,-0. <al%ati$n $f G$$d ill ; The meth$d $f 'al%ati$n $f !$$d ill at the time $f admissi$n& retirement $r death $f a partner sh$%ld be als$ be clearl# stated in it"

,-3. Re'al%ati$n $f Assets and =iabilities ; The meth$d $f re'al%ati$n $f assets and

liabilities $n admissi$n& retirement $r death $f a partner sh$%ld als$ be clearl# stated in it"

,-4. Acc$%nts and A%dit + The pr$ced%re $f (eepin! acc$%nts and their a%dit sh$%ld als$ be stated in it"

,-5. Diss$l%ti$n $f Partnership ; The deed sh$%ld c$ntain the firm and the meth$d $f the final settlement $f acc$%nts"

,-6. Arbitrati$n Cla%se ; In case $f disp%tes the meth$d $f app$intin!arbitrat$rs and their ri!hts sh$%ld be clearl# menti$ned"