A Partnership is defined, as the relation between persons who have agreed to share profits of the business carried on by all or any of them acting for all. A partnership firm is a popular form of business that is owned, managed and controlled by 2 or more people for common objective. Partnership firms are prevalent amongst small and medium sized businesses because they are relatively easy to set up and the number of statutory compliances required to be adhered are comparatively lesser as compared to LLP’s and company form of business.
Partnerships in India are governed by Indian Partnership Act, 1932. As per the Act, registration of partnership is not compulsory and its entirely at the discretion of the partners. However, an unregistered firm, may not be able to enjoy the benefits which a registered entity have been bestowed with. If the partners are interested in getting their firm registered then this registration can be done before starting the business or anytime during the continuance of the partnership.
Although registration is optional, but every firm must have a partnership deed which is its charter document containing the rights and obligations of the partners including the profit sharing ratio.
Our team can assist you in drafting a Partnership deed amongst the partners and in registering a partnership firm in India.
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