partnership act LAW 2020
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partnership act LAW 2020 - Leaderboard
partnership act LAW 2020 - Details
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39 questions
| 🇬🇧 | 🇬🇧 |
| Define partnership act ? | Sec 4 of IPA 1932 say partnership is the relation between person who have agreed to share the profit of a business carried on by all or any one of then acting for all. |
| Essential element of partnership | 1. association of two or more person 2. agreement between person 3. business 4. sharing of profit 5. mutual agency |
| Association of two or more person. describe? | 1. at least 2 person 2. maximum no= as per partnership act its silent. but CoMPANY ACT sec 464 say there shld be maximun 50 person. 3. if no of maximum person exceeds the it will become illegal association |
| Describe? agreement bet 2 person. | The relation of partnership arise from contract not from status. agreement shld be expressed or implied voluntary and contractual in nature |
| Describe business? | Sec 2(b) states business includes every trade, occupation and profession partnership can form for doing business and not for any charitable or social work. |
| Sharing of profit | Its is ESSENTIAL CONDITION for partnership. but not the conclusive test. if only one partner is entitle to share profit then there will be no partnership bet them |
| Mutal agency. | CARDINAL PRINCIPAL of PA. each partner is the agent of firm as well as principal of he other partner. thus, a partner is both an agent and principal. he can bind others with his act and can be bound by the act of others also |
| How many types of partnership is there? name them ? | 3 types 1. partnership at will 2. partnership for fixed time. 3. particular patnership |
| How many kind of partnership are there? | 9 types 1 actual /active partnership 2. nominal partner. 3. sleeping/dormant partner. 4. partner in profit only 5. sub partner. 6. incoming partner 7. outgoing partner |
| Actual partner? nominal partner? | ACTUAL partner take active participant in all activity and need to give public notice at the time of retirement NOMINAL partner is partner by name only. Do not contribute capital and not entitled to the share of profit held liable for all the act of firm |
| Sleeping partner ? partner in profit only ? | SLEEPING partner contribute capital, share in profit. liable for all the act. no active participation. no need to give public notice PARTNER IN PROFIT only entitled to earn profit not losses. if firm incur losses partner become insolvent then such partner will be held liable by 3 party |
| Sub partner? incoming partner? | SUB PARTNER when 1 partner agrees to share his profit with outsider then outsider is know as sub partner. sub partner has no right, no relation, no connection. INCOMING PARTNER is a partner who is admitting in already existing free and will be held liable for future act of firm |
| Out going partner RIGHTS | To receive his share of property and profit. can carry on similar business. cannot solicit the customer. cannot use firm name. in absences of any contact. he is entitle for 6% on his share in property. entitle to share of profit . |
| Out going partner LIABILITES | Not liable for any act done by firm after his leaving. liable to 3 party for= 1. all act done till the public notice is given. any transaction that has began but is left unfinished not liable for any act for which he is discharged by 3 party. |
| Minor | 1. cannot entre into a contract. but can be benificary to contract. 2. before his admission their shld be an existencing firm 3. all partner shld agree to add minor in partnership 4. at least 2 major partner. before admitting minor. |
| RIGHTS of MINOR | 1. share in profit and property. 2. to have access to the accounts. but cannot inspect books other then accounts 3. when he severe himself from the firm then only he van file a suit again them. 4. after attaing majority a]can opt to become a partner. |
| LIABLITIES of MINORS | 1. not personal liable nor his private estates is liable. 2. cannot declared insolvent. but if firm become insolvent then his share are transfer to officer assignee. 3. after 6 month of atainig majority need to give public notice. if not given then he will automatically be declared as partner. |
| Exercise option. more points related to minor? | If become partner= become personally liable to 3 party . share of profit and property remain the same. if not become a partner = can file a sue for his share of profit and property in firm if not given to him. not liable for any act. |
| Rights of the partner. | Take part in business. Access to books. Remuneration. Equal share of profits. intt on capital. Intt on advances. Use property of firms. Agent of the firm. Bind the firm. Emergency. Retirement. To share subsequent profit. Not to be expelled. |
| Duties? types? define them ? | 2 types of duties. 1. absolute duties= duties which are imposed by law. 2. qualified duties = which are imposed by the agreement between partners. |
| Types of absolute duties? | 1. duty to act in good faith. 2.duty to carry on the business of the firm in the greatest common advantage. 3. duty to render true accounts. 4. duty to give full information. 5. DUTY TO INDEMNIFY FOR THE LOSS CAUSED BY FRAUD. 6. duty not to transfer rights and interest. |
| Qualified duties? | 1.duty to account for personal profits 2.duty to attend his duties diligently. 3. duty to account profit in the competing business. 4. duty to use firm property exclusively for the firm. 5. duty to share loss equally. 6. duty to indemnify for will full neglect. |
| Implied authority ? | 1. in the firm names= act done in the firm name. intentially bnding the firm 2. normal business= must relate to normal business of the firms. if not in the normal business of the firm then the firm will not be bind. 3. usual way of carrying business= act shle be in usual way of business that is nature of the business and usage of the trade. 4. partners authority in an emergency. |
| 3 party shld be intimate about the change of the authority? | Restriction or extension of implied authority |
| Liabilities of partner? | 1.to contribute to losses equally. 2. to surrender personal profit. 3. joint and several liable. 4. to indemnify the firm. 5. liabilities toward third parties. 6. rights and liabilities after change in firm. |
| Introduction? | Section 56 to 71 deals with the registration of firm. registration of firms is not mandatory under this act. there is no penalty for no registration of a firm. |
| Procedure for registration of a firm. | Firm can be register any time. give app to ROF of name of the firms, name od the partner, address of the firm and partner, date when each partner join, duration of firm{if any} , name of the place where firm carries on its business. form should be sign by all the partners. after the registration certificateissue krte hai. |
| When is registration completed | Registration is complete and effective when properly filled document submitted to rof. |
| Consequences of non-registration of firm? | 1. cannot sue the other firm or any partner. 2. cannot suit 3 person or party. 3.claim of set off. |
| Non register will not affect the following=???? | 1. right of 3 party to sue the firm. 2. partners can file sur for dissolution, settlement of accounts of a dissolved firm and realising property of dissolved firm. 3. firm can claim suit for the set-off money not exceeding more than 100. 4. right of partner to file a criminal suit. |
| Section 69? | 1. suit is instituted on behalf of firm 2. person suing should be shown as he partner of register firm. |
| What is ADMISSION of partnership? | A person can be admitted in the already existing firm only, with the consent of al the partner. he will not be held liable for any act done by the firm before his joining. 3 party will never held him liable because there is no privity between them. a minor who opt to become a partner will be held liable for all the act done by the firm since his admission as benificary. |
| What is RETIREMENT of partnership? | MODE= by giving public notice, with partner's consent. or in accordance of expressed agreement. LIABILITY= discharge for all the act done after his retirement. will be liable to 3 party until the time he give public notice. 6% interest |
| EXPULSIVE . . . [most imp] | No partner can be expelled from the firm expect for good faith. the power must have existed in contract,. such power ne exercised by majority of partners. in good faith. what constitutes goof faith? to protect the intt of firm. opportunity of being heard. served with a notice to expelled partner. expelled void then right of expelled partner? =claim reinstatement. refund of his share even expelled partner has to give public notice. |
| What is death? | No public notice is required to be given at the death. normally firm get dissolved after the death of the partner. but if decided by the remaining partner to continue. then the estate of deceased partner will be liable for the act done before his death. and will not be held liable for any act done after his death. |
| What is DISSOLUTION? | Dissolution refers to putting an end to a mutual relationship between the partners. |
| Mode of dissolution? | 2 types of mode 1. by order of the court. 2. other mode. |
| By order of court? | 1. partner's insanity 2. permanent incapability 3.misconduct of partners 4. breach of agreement. 5. transfer of interest by partner. 6. heavy losses of firm. 7. just and equitable grounds |
| Other mode of dissolution? . . .IMPORTANT. | Mutual agreement. section 40 compulsory dissolution. section 41 certain event happening. section 42 notice for a partnership at will. section 43 |