PARTNERSHIP REGISTRATION IN CHENNAI

Partners are bound to carry on the business of the firm to greatest common advantage, to be just and faithful to each other, and to render true accounts and full information of all things affecting the firm to any partner, his heir or legal representative. Subject to the contract between the partners, the property of the firm shall be held and used by the partners exclusively for the purposes of the business. Where no provision is made by contract between the partners for the duration of their partnership, or for the determination of their partnership, the partnership is “partnership-at-will”.

ADVANTAGES

CAPITAL

The main advantage of owning a Private Limited Company is that the Liability of the shareholder limited to share held in the company.

SHARED RESPONSIBILITY

Partners can share the responsibility of the running of the business. So if one partner is good with figures, they might deal with the book keeping and accounts

FLEXIBILITY

A partnership is generally easier to form, manage and run. They are less strictly regulated than companies, in terms of the laws governing the formation

DECISION MAKING

Partners share the decision making and can help each other when they need to. More partners mean more brains that can be picked for business ideas

Frequently Asked Questions

What is a Partnership?

Partnership is an agreement between two or more people to share the profits of business. The business can be carried on together by all the partners or any one partner representing the others. A partnership can be for a fixed period of time or it may be limited to a specific project or it may be dissolved at will.

I am not a citizen of India. Can I be a partner in an Indian firm?

A partnership firm can be dissolved at any time if all the partners decide to dissolve it. This is known as dissolution by consent.

What is the capital of a partnership firm?

Capital is the initial amount in cash or kind contributed by the partners to start the business. It is not necessary for each partner to contribute equally to the capital. Contribution is based on the agreement between the parties.

Is a deed of partnership necessary?

It is not compulsory for a partnership deed to be in writing. Partnerships can also be oral.

Who can be partners?

Partners must be major (above the age of 18), should be sane and should not be disqualified by law from entering into a contract.

I have a minor son. Can he be a partner in my partnership firm?

No, a minor cannot become a partner. However, your minor son can be admitted to the benefits of the partnership firm. He can share the profits of the partnership business with the consent of the other partners. He can also access, inspect and copy the accounts of the firm. Though the minor is not personally liable for the losses of the firm, his share in the partnership business is liable for the losses incurred.

Can a minor admitted to the benefits of partnership, become a partner on attaining majority?

A minor admitted to the benefits of partnership, has the option to become a partner within six months of attaining majority. He has to give a public notice stating his acceptance or rejection of partnership. In the absence of a notice, it is considered that he has become a partner of the firm.

What is Partnership at will?

If a partnership deed does not provide for a duration or for dissolving the partnership in any manner, it is a Partnership at will.

Can a partner transfer his right in the business of the firm to an outsider?

Yes, a partner can transfer his interest in the business to an outsider, but only with the consent of all other partners.

Can a new partner be admitted into the partnership firm?

A partner can nominate a successor to take his place in the event of death or retirement of the partner. The mode of introducing a new partner or successor is based on provisions in the partnership deed. A new partnership deed is required once the new partner is admitted into the firm.

What is dissolution of partnership by consent?

A partnership firm can be dissolved at any time if all the partners decide to dissolve it. This is known as dissolution by consent.

Is a public notice necessary for the dissolution of the firm?

Yes, it is necessary to give a public notice at the time of dissolution. Otherwise, the partners remain liable to third parties for their actions, even after the dissolution. However, public notice is not necessary in case of : a. Deceased partner b. Insolvent partner c. Partner who is not known to be a partner and who has retired.

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