Purpose: To define and amend the law relating to partnerships in India.
Commencement: Effective from 1st October 1932, except Section 69 effective from 1st October 1933.
Chapter I: Preliminary
Section 1: Short title, extent, and commencement of the Act.
Section 2: Definitions of key terms like "act of a firm," "business," "third party," etc.
Section 3: Application of provisions of the Indian Contract Act, 1872 to partnerships.
Chapter II: The Nature of Partnership
Section 4: Defines partnership, partners, firm, and firm name.
Section 5: Partnership arises from contract, not from status.
Section 6: How to determine the existence of a partnership.
Section 7: Partnership at will - no fixed duration.
Section 8: Particular partnership - limited to specific ventures.
Chapter III: Relations of Partners to One Another
Section 9: General duties of partners.
Section 10: Duty to indemnify for loss caused by fraud.
Section 11: Rights and duties can be defined by contract.
Section 12: Conduct of business managed by mutual agreement.
Section 13: Mutual rights and liabilities.
Section 14 to 17: Property of the firm, application of property, personal profits, and changes in the firm.
Chapter IV: Relations of Partners to Third Parties
Section 18: Partner as an agent of the firm.
Section 19 to 21: Implied authority and extension or restriction of authority.
Section 22 to 24: Binding acts, admissions, and notices effective to the firm.
Section 25 to 30: Liabilities of partners, transfer of interest, and minors' involvement.
Chapter V: Incoming and Outgoing Partners
Section 31 to 32: Introduction and retirement of a partner.
Section 33: Expulsion of a partner.
Section 34 to 38: Insolvency, liability of deceased partner's estate, competitive business post-exit, and guarantee revocation.
Chapter VI: Dissolution of a Firm
Section 39: Definition of dissolution.
Section 40 to 44: Methods of dissolution - by agreement, compulsory, contingencies, court.
Section 45 to 51: Post-dissolution liabilities, rights, and settlement of accounts.
Section 52 to 55: Rescinded partnerships, use of firm name, and goodwill sale.
Chapter VII: Registration of Firms
Section 56 to 59: Exemptions, registrar appointments, application for registration.
Section 60 to 65: Recording alterations, changes, dissolution, and rectifications.
Section 66 to 69: Register inspection, effect of non-registration.
Chapter VIII: Supplemental
Section 72: Mode of giving public notice.
Section 74: Savings clause ensuring prior rights and obligations are unaffected by the Act.
Schedules
Schedule I: Details on maximum fees related to the filing and inspection of partnership documents.
State Amendments
Notable amendments in different states like Goa, Karnataka, Maharashtra, Rajasthan, and others, which adjust fees, registration processes, and specific provisions of the Act.
Important Notes:
Partnership requires consensus and mutual agreement for introduction or retirement of partners.
Rights and liabilities are significantly influenced by the registration status of the firm.
Partners act as agents and have certain implied authorities unless restricted by agreement.
Dissolution procedures and the rights of outgoing partners are well-defined, ensuring fair settlement.
Registration processes include detailed steps and required forms/documents, with variations across states.