- The law
relating to a partnership firm is contained in the Indian Partnership Act,
1932.
- Under Section
58 of the Act, a firm may be registered at any time ( not merely at the
time of its formation but subsequently also ) by filing an application
with the Registrar of Firms of the area in which any place of business
of the firm is situated or proposed to be situated.
- Application
shall contain:-
- name of the
firm
- place or
principal place of business
- names of any
other places where the firm carries on business.
- date on
which each partner joined the firm
- name in full
and permanent address of partners.
- duration of
the firm
- Application
shall be signed and verified by all the partners or their duly
authorized agents.
- Application
shall be accompanied by prescribed fee as well as the following
documents:
- Prescribed
Registration Form for Incorporation of a Company. (Form
No. 1 and Specimen
of Affidavit)
- certified
true copy of the Partnership deed entered into.
- ownership
proof of the principal place of business
- Name of the
firm should not contain any words which may express or imply the
approval or patronage of the government except where the government has
given its written consent for the use of such words as part of the
firms name.
- Under Section
59 of the Act, when the Registrar of Firms is satisfied that the
provisions of section 58 have been duly complied with, he shall record
an entry of the statement in the Register of Firms and issue a
Certificate of Registration.
- penalty for
furnishing false particulars (Section 70)
Any person who signs any statement, amending statement,
notice or intimation under this Chapter containing any particular which he
knows to be false or does not believe to be true or containing particulars
which he knows to be incomplete or does not believe to be complete, shall be
punishable with imprisonment which may extend to three months, or with a fine
or with both.
- Any
alterations, subsequent to Registration shall be notified to the
registrar:-
- Change in
firm name and principal place of business (Section 60) shall require
sending of a new application form along with the prescribed fee, duly
signed and verified by all the partners.
- Change
relating to opening and closing of branches. (Section 61)
When a registered firm
discontinues business at any place or begins to carry on business at any
place, such place not being its principal place of business, any partner or
agent of the firm may send intimation thereof to the Registrar.
- Change in the
name and permanent address of any partner (Section 62)
When any partner in a
registered firm alters his name or permanent address, an intimation of the
alteration may be sent by any partner or agent of the firm to the Registrar
- Change in the
constitution of the firm and its dissolution [Section 63(1)]
when change occurs in the
constitution of the firm, any of the new, continuing or the outgoing partner,
while when a registered firm is dissolved , any person who was a partner
immediately before the dissolution or the agent of any such partner or person
specially authorized on his behalf, may give notice of such a change to the
Registrar, specifying the date thereof.
- Under Section
63(2), when a minor who has been admitted to the benefits of
partnership in a firm attains majority and elects to become or not to
become a partner, he or his agent specially authorized in this behalf,
may give notice to the Registrar that he has or has not become a
partner.
- Accordingly,
the various forms prescribed under the Indian Partnership Act, 1932,
for the alterations in the registered partnership firm are:-
a. Form No. II :- For change
of principle place of business & change in the name of the firm.
b. Form No. III :- For change
of the other then principle place of business.
c. Form No. IV :- For change
of name of the partners & permanent address of the partners.
d. Form No. V :- For change
of constitution of forms & addition or retirement of partner.
e. Form No.VI :- For
dissolution of the firm
f. Form No. VII :- For minor
partner attains the age of majority.
- Partnership
Act, 1932 does not provide for compulsory registration of firms. It is
optional for partners to set the firm registered and there are no
penalties for non-registration.
However, Section 69 of the Act which deals
with the effects of non-registration denies certain rights to an unregistered
firm. Under the Act :-
- A partner of
an unregistered firm cannot file a suit in any court against the firm
or other partners for the enforcement of any right arising from a
contract or right conferred by the Partnership Act unless the firm is
registered and the person suing is or has been shown in the Register of
Firms as a partner in the firm.
- No suits to
enforce a right arising from a contract shall be instituted in any
Court by or on behalf of a firm against any third party unless the firm
is registered and the persons suing are or have been shown in the
Register of Firms as partners in the firm.
- An
unregistered firm or any of its partners cannot claim a set off (i.e.
mutual adjustment of debts owned by the disputant parties to one
another) or other proceedings in a dispute with a third party.
Hence, every firm finds it advisable to get itself registered sooner or
later.
- However,
non-registration of a Partnership firm shall not affect:-
- The rights of
third parties to sue the firm and/or its partners.
- The firms or partners
in the firms which have no place of business in the territories to
which this Act extends, or whose places of business in the said
territories are situated in areas to which the act does not apply.
- any suit or
claim or set-off not exceeding one hundred rupees in value which, in
the Presidency-towns, is not of a kind specified in Section 19 of the
Presidency Small Cause Courts Act, 1882 (15 of 1882), or outside the
Presidency- towns, is not of a kind specified in the Second Schedule to
the Provincial small Cause Courts Act, 1887 (9 of 1887), to any
proceeding in execution or other proceeding incidental to or arising
from any such suit or claim.
- the
enforcement of any right to sue for the dissolution of a firm or for
accounts of a dissolved firm, or any right or power to realise the
property of a dissolved firm.
- the powers of
an official assignee, receiver or Court under the Presidency-towns
Insolvency Act, 1909 (3 of 1909), or the Provincial Insolvency Act,
1920 (5 of 1920), to realise the property of an insolvent partner.
- Rectification
of mistakes (Section 64 of the Act)
- The Registrar
shall have power at all times to rectify any mistake in order to bring
the entry in the Register of Firms relating to any firm into conformity
with the documents relating to that firm filed under this Act.
- On
application made by all the parties who have signed any document
relating to a firm filed under this Act, the Registrar may rectify any
mistake in such document or in the record or note thereof made in the
Register of Firms.
- Inspection of
Register and filed documents (Section 66 of the Act:)
- The Register
of Firms shall be open to inspection by any person on payment of such
fee as may be prescribed.
- All
statements, notices and intimations filed under this Act shall be open
to inspection, subject to such conditions and on payment of such fee as
may be prescribed.
- Grant of
copies (Section 67 of the Act)
The Registrar shall on application furnish to any person, an payment of
such fee as may be prescribed, a copy, certified under his hand, of any
entry or portion thereof in the Register of Firms.
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