The document discusses different types of non-corporate business entities including sole proprietorship, Hindu Undivided Family (HUF), partnership, limited liability partnerships, and insolvency law. It describes the key features, advantages, disadvantages and essential legal aspects of each entity type. For partnerships specifically, it covers partnership deeds, rights and duties of partners, and the landmark case of Meinhard v. Salmon which established the fiduciary duty between business partners.

1. Non Corporate Entities
Presented By:
Monika
Nadim Ashraf
Nikhil Agarwal
Sunkara Gokul
Subhashree Dash

2. SOLE
PROPRIETORSHIP

3. FEATURES
• One man control
• Unlimited liability
• Non-tax entity
• Profits & Losses not shared by anyone
• No perpetual existence
• Need not be registered

4. ADVANTAGES
• Easy to form and wind up
• Better Control
• Secrecy is maintained
• Sole decision maker
• Flexibility in operations, easy tax filing.

5. DISADVANTAGES
• Limited capital
• Unlimited liability
• No perpetual succession
• Limited size
• Lack of managerial expertise
• Unwarranted expenses
• Not suitable for large scale business

6. HINDU UNDIVIDED FAMILY
• Formation of HUF: Governed by Hindu Law.
• Membership: Two types of members Karta, Co-
parceners and members.
• Liability: The liability of Karta is unlimited,
however the coparceners are limited.
• Partition: any coparcener who is unsatisfied with
the decision of Karta can demand partition.
• Secrecy is maintained.

7. PARTNERSHIP

8. ESSENTIAL CHARACTERISTICS
• Association of two or more persons
• Agreement
• Sharing Of Profits
• Mutual Agency

9. PARTNERSHIP DEED
• Legal document created before/during the
commencement of partnership firm.
• It must be signed by all the partners of the
firm.

10. It includes the following:
• Name of the partners
• Date of commencement
• Duration of partnership
• Name of the firm
• Capital contributed by members
• Profit/Loss sharing ratio
• Location of the firm

11. RIGHTS OF A PARTNER
• Right to take part in the partnership business.
• Right to be consulted in partnership business &
freedom to express his views before any
decision is taken by other partners.
• Right to have access, inspect and take copy of
any book of accounts of the firm.
• In absence of any agreement to the contrary,
partners are entitled to share equally
the profits and losses of the firm.

12. RIGHTS OF A PARTNER
• Right to do all acts necessary to protect the firm
from losses.
• To receive interest on a capital.
• Every partner has right to retire:
1. With consent of all partners.
2. In accordance with the terms.
3. By giving notice to all partners.

13. DUTIES OF A PARTNER
• To attend diligently to his duties in the conduct
of the business.
• Not to carry a business which competes to the
present business of the firm.
• To be faithful to each other.
• To render true accounts and full information.
• To contribute towards the losses
sustained by the firm.

14. Meinhard v. Salmon
Facts:
• Salmon – owner of 20 year lease on a hotel,
defendant.
• Meinhard – formed partnership with Salmon,
investor, plaintiff.
• Gery – third party, owner of the leased hotel.
• After 20 years, defendant entered
into a new lease with the third party
and resigned from the existing without
informing the plaintiff.

15. Meinhard v. Salmon
Issue:
• Meinhard argued the new opportunity belonged
to the partnership.
• Salmon argued any interest in the new lease
could not belong to the partnership.
Provisions:
• Partners have right to be consulted.
• Partners owe fiduciary duties.
• Duty of communication.
• Duty of loyalty.

16. LIMITED LIABILITY
PARTNERSHIPS

17. SALIENT FEATURES
The LLP:
• is a corporate body with a perpetual succession.
• must have either the word “limited liability
partnership” or the acronym “LLP”.
• shall not be regulated by the law relating to
partnership.
• has no limit on the maximum number of partner.
• shall be registered with the ROC
under the companies act, 1956

18. • The liability of the partner is limited.
• shall maintain proper books of account.
• Inspector may be appointed by the central
government to investigate the affairs.
• The property of the LLP shall be treated as the
property of the partner.
• A partner of LLP can freely transfer his
economic interest either in or in a part of third
person.
• LLPS can now electronically file
their return.

19. INSOLVENCY LAW

20. FEATURES
Contained in 2 enactments:
• The Presidency Towns Insolvency Act
• The Provincial Insolvency Act
A person is be judged as insolvent when he:
• is a ‘debtor’,
• is competent to form contract,
• has committed an ‘act of insolvency’.

21. ACTS OF INSOLVENCY
• Where debtor makes a transfer either in India or
elsewhere for the benefit of his creditors.
• If debtor makes any transfer of his property with
the intention to defraud or delay creditors.
• If he has given notice to any of his creditors that
he has/is likely to suspend the payment of his
debts.
• If debtor is imprisoned in the
execution of any decree of a court
for the payment of money.

22. ACTS OF INSOLVENCY
If the debtor:
• Leaves or stays out of India
• Leaves his usual place of business or otherwise
absents himself
• Hides himself so as to deprive his creditors or
means of communicating him.

23. REFERENCES
• Elements Of Mercantile Law by
N.D.Kapoor
• Legal Environment Of Business(Text
Book)