INDIAN PARTERSHIP

ACT 1932
 Commercial Law
Presentation
Topic : The Indian Partnership
Act,1932

Section : SC2

Group Members : HARSHUL

BAKHRU
SHASHANK TAYAL
Section 4 of Indian Partnership Act
1932 defines partnership in the
following terms:”Partnership is the
relationship between persons who
have agreed to share the profits of
business carried on by all or any of
them acting all”.
Persons  who have entered into
partnership with one  another  are
called individually "partners" and
Essential Elements
There must be a contract
Between two or more
person
Who agree to carry on a
business
With the object of sharing
profits
PARTNERSHIP DEED
 The name of the firm and the names and addresses of
partners who compose it.
 Nature of business and the place where it will be carried on
 Date of commencement of partnership
 The duration of partnership
 The amount of capital to be contributed by each partner
 The ratio of sharing profits and losses
 Salaries ,commissions etc if any ,payable to partners
 Expulsion of partners in case of gross breach of duty or fraud
 Arbitration incase of disputes against partners
 The methods of preparing accounts and arrangement for
audit & safe custody of cash etc.
 rules to be followed in case of retirement ,death &admission
of a partner
 KINDS OF PARTNERSHIP
Active or actual partners
Sleeping or dormant partners
Silent partners
Partners in profit only
Sub partner
Partners by estoppel or holding
out
 RIGHTS OF A
PARTNER
Right to take part in the conduct of
the business
Right to be consulted
Right to access the books
Right to share the profits & losses
Right to interest on advances @6%
p.a
Right to indemnity
DUTIES OF A
PARTNER
Absolute/fundamental
duties

Qualified duties
 ABSOLUTE DUTIES
Duty to carry on the business to the
greatest common advantage
Duty to be just and faithful
Duty to render true accounts
Duty to provide full information
Duty to indemnify for loss caused
by fraud
Duty to be liable jointly and
severally
 QUALIFIED DUTIES
Duty to attend diligently to his duties
Duty to work without remuneration
Duty to contribute to the losses
Duty to indemnify for the willful neglect
Duty to use firms property exclusively for
the firm
Duty to account for personnel profits
derived
Duty not to compete with the business of
the firm
 INCOMING &
OUTGOING
Introduction of a new
partner
Retirement of a partner
Expulsion of partner
Insolvency of a partner
Death of a partner
 LIABILITY OF AN
INCOMING PARTNER
Not liable for previous acts
Liable for existing debts if
a)new firm is made ; agreed to
take over existing liabilities of
the old firm
b)creditor discharge old firm ,
agreed new firms as debtor
 MODES OF
RETIREMENT
In an agreement

By consent of all the

partners

Partnership at will , notice to

retirement
DISSOLUTION OF A
PARTNERSHIP
By agreement
 FIRM
 By notice
 On the happening of certain contingencies
 Compulsory dissolution
 Dissolution by the court
-insanity
-permanent insanity
-misconduct
-persistent breach of agreement
-Transfer of interest
-continuous losses
CONSEQUENCES OF
DISSOLUTION
Continuing liability of partners after
dissolution
Continuing authority of partners for
purposes of winding up
Rights of partners to enforce winding up
Liability to share personal profits
Return of premium
Rights where partnership contract is
rescinded for fraud , etc
Rights to impose restrictions
THANK
YOU