This document provides an overview of partnership law in 3 pages with 5 sections. It defines a partnership as an agreement between 2 or more people to share profits from a business. It outlines the key elements of a partnership including voluntary agreement and sharing of profits. It also describes types of partners, classes of partnerships, consequences of non-registration, rights and liabilities of partners, and grounds for dissolution. The document serves as an introductory guide to some of the main concepts in partnership law.

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Contents
The Law of Partnership.
Presentation on :
Rezaul Karim
Jahid Hussain
Mehedi Hasan Polash
Presented By:
Mohammad Khairul Islam Sazeen

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Nature of Partnership
“Partnership is the relation between persons who have
agreed to share the profits of a business carried on by
all or any of them acting for all.”
What is Partnership?
According to the Partnership Act Section 4 -
1.There must be an agreement entered into by two or
more persons.
2. The agreement must be to share the profits of a
business.
3.The business must be carried on by all or any of
them acting for all.
 A partnership must have three essential elements:

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Nature of Partnership
A partnership cannot be formed with more than ten persons in
banking and twenty persons in other types business. A Partnership
with persons exceeding the above limits must be registered under
a Companies Act.
Characteristics of Partnership
1.Voluntary Agreement
3.Mutual Agency
It states that person Carrying on business in partnership are
agents as well as principals.
The business of a firm is carried on by all or by anyone or
more of them on behalf of all.
2.Sharing of Profits of a Business
Two or more persons join together to give musical
performances to the public
with a view to earning profit, there is a business and a
Partnership is formed.

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Nature of Partnership
Who Can be a Partner?
1.person: Under the Indian Partnership Act. a person may be
Partner if he has the capacity to enter into a contract.
2. Minor: A minor cannot be a partner. But in an existing
partnership, a minor can be
admitted into a firm if all the partners of the firm agree.3. Person of unsound mind: A person who is of unsound mind
cannot become a partner.
4. Woman: A woman can be a partner, married or unmarried, 0f
course a woman cannot be a partner if she is a minor or she is
unsound mind.
5.Company: In a Company the capacity to enter into contract is
determined by the
Memorandum and Articles of the Association the of company.

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Nature of Partnership
Classes of Partners:
1.Active Partner: An active partner is one who actually
participates in the business of
the firm. A person becomes a partner only by agreement.
2. Dormant, sleeping or Nominal Partner: These partners Join
the firm by agreement
but do not take any active part in the business. Their
liabilities are same as of Active
Partners.3. Sub-Partner: The transferee of a share of a partner's interest
in a firm is called a Sub
Partner. Suppose P, owner of 1/4 of firm, the transfers 1/2 of
his share to Q. Q will
called a sub-partner. His rights and liabilities are limited.

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Nature of Partnership
Classes of Partnership:
1.Partnership-at-will: A partnership is called a partnership at
a) when the partnership is not for a fixed period of time and,
b) when no provision is made as to when and how the partnership
will come to an end.
2. Particular Partnership-Joint Venture: A particular partnership
is one which is formed for a particular adventure or a particular
undertaking.
3. Limited Partnership: A partnership may be formed in which
the liability of all partners is limited. There must be at least one
partner with unlimited liability.

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Nature of Partnership
Consequences of Non -registration:
An unregistered firm and the partners thereof suffer from certain disabilities
3. An unregistered firm cannot claim a set-off in a suit.
1.A partner of an unregistered firm cannot file a suit for the
purpose of enforcing a right arising from contract or a right
conferred by the Partnership Act.
2. No suit can be filed on behalf of an unregistered firm against
any third party for the purpose of enforcing a right arising from a
contract.

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Rights & Liabilities
Relation of Partners with
one another:
The Partnership Act lays down two general rules regarding the conduct of the partners
to one another.
1.General duties of partners: “Partners are bound to carry on and
business of the firm to
the greatest common advantage, to be just faithful to each other and
to render true accounts
and full information of all things affecting the firm to any partner or
his legal representative.”2 Indemnity: "Every partner shall indemnify the firm for any loss
caused to it by his fraud
in the conduct of the business of the firm”.

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Rights & Liabilities
Rights of
Partners:
6.Interest on advance: A partner, paid or advanced to the firm the
amount of capital, is entitled to interest thereon at the rate of six per
cent per annum.
1. Conduct of business: Every partner has a right to take part in the
conduct of the business.
2. Can express opinion: Every partner shall have the right to
express his opinion.3.Access, inspection, copy: Every partner has a right to have access
and to inspect and copy any of the books of the firm.
4.Equity of the profits: The partners are entitled to share equally
earned.
5. Interest on capital: A partner is entitled to get interest on the
capital out of profits only.

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Rights & Liabilities
Rights of
Partners:
8.Application of property of firm: The property of the firm shall be
hold and used property by the partners exclusively for the purposes of
the business.
9. Partner's authority: Every partner has right to act on behalf the
firm. He has express and implied authority.
7. To get indemnity: The firm shall indemnify the partner in respect
payment's made and liabilities incurred by him.
10. Powers in an emergency: He has certain powers in an
emergency.

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Dissolution of Firm
What is Dissolution?
Dissolution of a firm means the end of a firm by the
break up of the relation of partnership between all
the partners.
The Ground of Dissolution:
A firm may be dissolved on any of the following grounds:
1.By Agreement (Sec. 40)
A firm may be dissolved any time with the consent of all the
partners of the firm. Partnership is created by contract, it can also
be terminated by contract.2.Compulsory Dissolution (Sec. 41)
A firm is dissolved -
(a) by the adjudication of all the partners or of all the partners
but one as Insolvent. or
(b) by the happening of any event which makes the business of

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Dissolution of Firm
The Ground of
Dissolution:4.By Notice (Sec. 43)
where the partnership is at will, the firm may be
dissolved by any Partner giving notice in writing to
all other partners of his intention to dissolve the firm.
5. Dissolution by the Court (Sec. 44)
At the suit of a partner, the court may dissolve a firm on any one
the following grounds:
a) Insanity
If a partner has become of unsound mind.
b)Transfer of Whole Interest:
If a partner has Transferred the whole of his interest in the firm to an
outsider or has allowed his interest to be sold in execution of a
decree.c)Loss:
If the business of the firm cannot be carried on except at a loss.

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5 Any Question?
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