PLEASE READ THIS CHAPTERFROM BOOK AS WELL1Law of Partnership
PLEASE READ THIS CHAPTERFROM BOOK AS WELL2Types of business• Sole proprietorship in Pakistan• Partnership in Pakistan• Limited liability company in Pakistan
PLEASE READ THIS CHAPTERFROM BOOK AS WELL3Why Partnership?• Easy Formation• More Capital• Better Management• Skilled Employees• Easy Dissolutions
PLEASE READ THIS CHAPTERFROM BOOK AS WELL4IntroductionPartnership is governed inPakistan, through the provision ofthe “Partnership Act, 1932.”
PLEASE READ THIS CHAPTERFROM BOOK AS WELL5MeaningA Partnership is a Voluntary association ofTwo or more persons, who contribute ,Money, property , time , skill to carry onbusiness for profit and to share thelosses of the business.
PLEASE READ THIS CHAPTERFROM BOOK AS WELL6Definition“Partnership is the relation between personswho have agreed to share the profits of abusiness carried on by all or any of themacting for all.” Sec-4.
PLEASE READ THIS CHAPTERFROM BOOK AS WELL7Definition• Prof Haney:“ Partnership is the relation betweenpersons to make contracts who agree tocarry on a lawful business with a view togain.”
PLEASE READ THIS CHAPTERFROM BOOK AS WELL8Characteristics• Legal Entity.A Partnership has no separate legal entity apartform its members.Firms and the partner are not separate fromone another.The rights and liabilities of the firm areconsidered the rights and liabilities of thepartner.
PLEASE READ THIS CHAPTERFROM BOOK AS WELL9• Unlimited Liability– In case of loss if the business sources areinsufficient to meet claim of the creditors, theprivate properties of the partners can be sold.• Agreement– A partnership is the result of an agreementbetween persons.
PLEASE READ THIS CHAPTERFROM BOOK AS WELL10• Control– Depends on the Terms of the Agreement.• Mutual Agency– Each partner acts as agent of the otherpartners of the firm. Because he binds himselfto the activities of other partner.• Numbers of Partners.– At least 2 persons– Maximum 20 persons
PLEASE READ THIS CHAPTERFROM BOOK AS WELL11Sharing of Profits• Share the profit of the business accordingto their agreement.• If no agreement then Equally.• Loss according to agreed ratio.
PLEASE READ THIS CHAPTERFROM BOOK AS WELL12Partnership Deed• The Partnership agreement in writing iscalled Partnership Deed.• The Partnership deed contains theProvisions:1. The Name of Firm.2. The names and address of all Partners.3. The nature of Business of A firm
PLEASE READ THIS CHAPTERFROM BOOK AS WELL134. The ratio of sharing the profit andlosses.5. The Rights , duties and Liabilities of aPartner.6. The restrictions on partners , if any.7. The Rules regarding the Admission ,Retirement , death and Expulsion ofpartner from frim.
PLEASE READ THIS CHAPTERFROM BOOK AS WELL148. The keeping of proper books of accountsand preparation of Accounts.9. The Circumstance under which the firmshall dissolve.10.The Methods of Solving disputes amongthe partners and appointment ofArbitrator.
PLEASE READ THIS CHAPTERFROM BOOK AS WELL15Kinds of Partners• Liability• Participation in Management• Shares of Profit , Etc… any other basis
PLEASE READ THIS CHAPTERFROM BOOK AS WELL16• Active PartnerTakes an active part in the ManagementPublic Notice before RetirementAlso known as Working Partner.• Sleeping Partner/ Dormant PartnerDoes not take an Active Part inManagement, Notice is not required incase of Retirement, Also liable.
PLEASE READ THIS CHAPTERFROM BOOK AS WELL17• Partners in Profits only.Shares the Profit of the firm.Not liable for the Losses• Secret PartnerWhose membership Kept secret fromOutsiders
PLEASE READ THIS CHAPTERFROM BOOK AS WELL18• Senior PartnerKey role in Management , due toexperience ,age, capability , and otherskills. Besides that investment more in theBusiness.• Junior PartnerLess experience , small investment,
PLEASE READ THIS CHAPTERFROM BOOK AS WELL19Minor PartnerCompetent to contract 18 ageWith the Consent of all the PartnersHe may be admitted to the benefits ofPartnership by an agreement with hisguardian.
PLEASE READ THIS CHAPTERFROM BOOK AS WELL20• Nominal PartnerOne who lends his name and reputation tothe firm, does not invest, does notparticipate, he is liable.
PLEASE READ THIS CHAPTERFROM BOOK AS WELL21Types of Partnership• Partnership-at-will• No provision is made in the agreementregarding the duration of firm.• Formed for Unlimited Period.• Project complete after it continues.• Notice of Termination , given by anypartner at any time.
PLEASE READ THIS CHAPTERFROM BOOK AS WELL22Particular Partnership• Formed to do a particular business. Or• For a particular period.• A Partnership is dissolved immediately onhe completion of the particular business.
PLEASE READ THIS CHAPTERFROM BOOK AS WELL23Limited Partnership. (Englandbased)• Some Partners may be with LimitedLiability• At least on have unlimited Liability• Registered Firm• Limited partner inspects the books
PLEASE READ THIS CHAPTERFROM BOOK AS WELL24DISSOULTION OF FIRM• BY AGREEMENT• COMPULSORY• CONTINGENT• BY NOTICE• BY THE COURT– Insanity , Permanent Incapacity , misconduct,– Breach , Transfer of interest,– Continuous losses , Just and Equitable