partnership having more than 20 persons is illegal
. When there is partnership between two firms, all the partners of each firm will be taken into account. If the partnership is between the karta or member of Hindu undivided family the members of the joint Hindu family will not be taken into account
Partnership Firm is not a legal entity - It may be surprising but true that a Partnership Firm is not a legal entity. It has limited identity for purpose of tax law. As per section 4 of Indian Partnership Act, 1932, 'partnership' is the relation between persons who have agreed to share the profits of a business carried on by all or any one of them acting for all. - - Under partnership law, a partnership firm is not a legal entity, but only consists of individual partners for the time being. It is not a distinct legal entity apart from the partners constituting it - Malabar Fisheries Co. v. CIT (1979) 120 ITR 49 = 2 Taxman 409 (SC).
Active / actual / ostensible partners: must give public notice of his retirement
Sleeping/ dormant partners: undisclosed principal, have voice in Mgt .not required to give PNoR
Silent partners: no voice in Mgt., fully liable for P/LPartner in profits only: No voice in Mgt. only for P. still not in India LLP
Sub partner: A partner agrees to share his P with O/S this O/S is Sub Partner
Partner by estoppel /holding out/ Quasi Partner/ Nominal Partner:
No agreement but the person holds out, represents himself to be a partner, becomes responsible to O/s as partner. It is not necessary that representation must be made directly to the person so giving credit.
partnership firm has no legal entity or perpetual existence.
Change in partners via death, retirement, admission of new member, expulsion, insolvency, transfer of interest by partner etc. This changes, the rights and liabilities of each partner. This is termed as reconstitution of a firm.
DISSOLUTION OF PARTNERSHIP AND DISSOLUTION OF FIRM –
Dissolution of partnership between all partners of firm is dissolution of firm
When one or more partners cease to be partners but others continue it is called dissolution of partnership, it is reconstitution of of firm without dissolution