LEGAL ASPECTS OF BUSINESS AFTERSCHO☺OL – DEVELOPING CHANGE MAKERS CENTRE FOR SOCIAL ENTREPRENEURSHIP PGPSE PROGRAMME – World’ Most Comprehensive programme in social entrepreneurship & spiritual entrepreneurship OPEN FOR ALL FREE FOR ALL
LEGAL ASPECTS OF BUSINESS Dr. T.K. Jain. AFTERSCHO☺OL Centre for social entrepreneurship Bikaner M: 9414430763 [email_address] www.afterschool.tk www.afterschoool.tk
Jiten gave his spare 1 Crore Rs. To me to be advanced as loan for micro finance. He will be given 20% share in profit plus 10% interest on his capital . Are we partners as per the Indian partnership Act?
No ( read Mollow March & Co. V/s Court of Wards, 1872).
Mayank has a large shipping business. He appoints me as shipping incharge with 20% share in net profit. Are we partners now?
No. (see Abdul Latif V/s Gopeswar 1933).
A,B,C are partners. C dies, Now C’s widow becomes partner in the share of the business. She promises not to withdraw the money and will continue to get 30% profits. Is she a partner?
No (see CIT v/s Kesharmal). She is getting profit in lieu of interest, but actually she is not partner.
A was an Advocate. He asked B to join him. He assured B that he will give all his clients to B. B also got share in profit of A’s profession. A wanted to sell his profession to B. Are they partners?
No. ( see Rawlison V/s Clarke 1846).
Every contract requires considdration, thus does the partnership contract require consideration?
No. ( see sec. 185 of Indian Contract Act).
Ajay and Dhaval are joint owners of a property. They give this property on rent to Prateek, and share rent equally. Are they partners?
No. ( they are only joint owners).
Every contract requires lawful object, thus does the partnership contract require lawful object?
does the partnership contract require partnership deed?
No (you should have it, it is advisable).
Should the partnership deed by signed by all the partners?
What will happen, if the deed is not stamped ?
It will not be considered as deed. It has to be duly stamped as per Indian Stamp Act.
Ajay gets married to a business woman, who is a partner in a big firm. Later the firm gets insolvent, will Ajay and his personal property be used in making payment?
(however, personal property of his wife will be used in making payment of outstanding amount).
Goutam is 17 and Ajay is 20. Can they become partners?
(because Goutam is still minor).
Sapna and Jayati set up a firm titled Royal Travels. Is there any problem?
Yes = the word ROYAL cannot be used in partnership firm.
Can a partner of an unregistered firm file a suit against the firm?
Can a partner of an unregistered firm file a suit against other partners?
Can a partner of an unregistered firm file a suit for dissolution of the firm?
Can an unregistered firm sue for its statutory rights under any law?
Can third party sue against unregistered firm?
Can a partner of unregistered firm enforce arbitration before arbitrator?
AB is a unregistered partnership firm. They buy goods of Rs. 10000 from XYZ. They also sell goods of Rs. 10000 to XYZ on credit. XYZ demands their payment. ABC insist tha their 10000 due should be adjusted against it. Are they right?
Their’s is an unregistered firm, they are bound to pay Rs. 10000. They cannot claim for their money of 10000 through legal process.
ABC are partners in unregistered firm . A is wrongfully expelled from the firm. Can A claim damages for this and become a partner again.
No. However, he can apply for dissolution of the firm and also for accounts.
Can a minor demand accounts of a partnership firm, in which the minor is profit sharing partner?
Can a minor sue other partners in a firm (minor is also a partner)?
Goutam is a partner in a firm – only to share profit (as he is minor). When he becomes 18, he gives a public notice that he has become a full fledged partner. Other partners refuse to take him as partner. Can Goutam become partner?
Can a partner do a business competing with his firm’s business?
Can a partner have the right to get information about accounts of the firm?
Afterschoool conducts three year integrated PGPSE (after class 12 th along with IAS / CA / CS ) and 18 month PGPSE (Post Graduate Programme in Social Entrepreneurship) along with preparation for CS / CFP / CFA /CMA / FRM . This course is also available online also. It also conducts workshops on social entrepreneurship in schools and colleges all over India – start social entrepreneurship club in your institution today with the help from afterschoool and help us in developing society.
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