1. What's the partnership?

Partnership is an agreement between two or more people to share the profits of a firm. The business may be carried out jointly by all partners or by any partner representing the others. A partnership may be for a fixed period of time or may be limited to a specific project or may be dissolved at will.

2. What are the necessary elements needed to form a partnership?

1. An agreement must be entered between two or more persons.

2. The agreement must be to share the profits of the firm.

3. All or any of the partners together, on behalf of the others, must carry on the business.

3. Who could be partners?

The partners must be major (above the age of 18), should be healthy and should not be disqualified from entering the contract by law.

4. What is the scope of liability for partnerships?

Each partner, together with all other partners and also individually, shall be liable for all the acts / activities of the firm during the course of the business while it is a partner. This means that if a loss or injury is caused to a third party or a penalty is levied during the course of business, all partners will be held liable even if the injury or loss is caused by one of the partners.

5. What are the different types of Partnership firms?

1. Partnership by will A partnership is a partnership where no provision has been made for a contract between the partners for the duration of their partnership or the establishment of their partnership.
2. Particular partnership A particular partnership is when a person becomes a partner with another individual in a particular business enterprise or for a particular business venture or undertaking, such as the construction of a road, the laying of a railway line, etc. This type of partnership shall come to an end upon completion of the task for which it was initially established.

6. What are the Kinds/Types of Partners?

Active partner He is the one who is present at every step in the workings of the partnership. It plays the most important role and is mainly responsible for all the work.

Sleeping partner He is one who does not participate actively in the partnership process. They're not known to the public. They're working in the background.

Nominal partner He's only a name partner. That's because he doesn't play a part in the Firm’s  work. He is not interested in working, nor does he share the profit.

Profit partner When a partner is entitled to profits only, as agreed by all the other partners. He is not liable for any kind of loss.

Minor Partner He is one who is under the age of 18 years and is entitled to the benefits of the partnership only. There are restrictions such as not being able to participate or intervene in the business operations.

Other partners Generally speaking, including a silent partner. They do not want to be known to the outside world. They're going to sit back and work.

7. How to register a partnership?

The application form, together with the fees, must be submitted to the Registrar of Firms of the State in which the firm is situated. All partners or their agents must sign the application.

8. Is it necessary to register a partnership?

The Indian Partnership Act, 1932 governs the partnership. Registration of a partnership firm shall be optional and at the discretion of the partners.

Registration of a partnership firm may take place at any time – before starting a business or at any time during the continuation of the partnership.

It is always advisable to register a firm as registered firms enjoy special rights which are not available to unregistered firms.

9. what are the duties as a partner in a firm?

1. Carry on the business.

2. be just and faithful to each partner.

3. Disclose true accounts of the firm.

4. Furnish full information of all things affecting the firm.

10. What are the limitations as a partner?

1. Submit a dispute relating to the business to arbitration.

2. Open a bank account on behalf of the firm in your own name.

3. Compromise or relinquish any claim or portion of a claim of the firm.

4. Withdraw a suit or proceeding filed on behalf of the firm.

5. Enter into partnership with an outsider on behalf of the firm.

6. Acquire or transfer immovable property belonging to the firm.

7. Admit any liability in a suit or proceeding against the firm.

11. Can a new partner be admitted to a partnership?

A partner may nominate a successor to take his place in the event of the death or retirement of the partner. The manner in which a new partner or successor is introduced is based on the provisions of the partnership act. A new partnership document is required once the new partner has been admitted to the firm.

12. Can a firm become a partner in another firm?

A partnership firm can not become a partner of another firm because it is not a legal entity. The partners may, however, be partners in another firm in their individual capacity.