partnersip act

8/9/2019 Partnersip Act

http://slidepdf.com/reader/full/partnersip-act 1/37

Partnership Act, 1932

Preamble

CHAPTER I

Preliminary

CHAPTER - II

The Nature ! Partnership

CHAPTER-III

Relati"ns "! Partners t" "ne An"ther

CHAPTER - I#

Relati"ns ! Partners T" Thir$ Parties

CHAPTER - #

Inc"min% An$ ut%"in% Partners

CHAPTER - #I

&iss"luti"n ! A 'irm

CHAPTER - #II

Re%istrati"n ! 'irms

CHAPTER - #III

(upplemental

(CHE&)*E

+a imum 'ees

APPEN&I I

APPEN&I II

APPEN&I III

Preamble

THE PARTNER(HIP ACT, 1 932



I "! 1932

.th April, l932

An Act t" $e/ne an$ amen$ the la0 relatin% t" partnership

hereas it is e pe$ient t" $e/ne an$ amen$ the la0 relatin% t" partnership

It is hereby enacte$ as !"ll"0s4-

CHAPTER I

Preliminary

1 (h"rt title, e tent an$ c"mmencement4

516 This Act may be calle$ the Partnership Act 1932

526 It e ten$s t" the 0h"le "! Pa7istan

536 It shall c"me int" !"rce "n the 1st $ay "! ct"ber, 1932, e cept secti"n 89,0hich shall c"me int" !"rce "n tile 1st $ay "! ct"ber, 1933

2 &e/niti"ns4

In this Act, unless there is anythin% repu%nant in the sub ect "r c"nte t, -

5a6 an :act "! a /rm: means any act "r "missi"n by all the partners, "r by anypartner "r a%ent "! the /rm 0hich %i;es rise t" a ri%ht en!"rceable by "r a%ainst the/rm

5b6 :business: inclu$es e;ery tra$e, "ccupati"n an$ pr"!essi"n

5c6 :prescribe$: means prescribe$ by rules ma$e un$er this Act

5$6 :thir$ party: use$ in relati"n t" a /rm "r t" a partner therein means any pers"n0h" is n"t a partner in the /rm an$



5e6 e pressi"ns use$ but n"t $e/ne$ in this Act an$ $e/ne$ in the C"ntract Act,1.<2 5I "! 1.<26, shall ha;e the meanin%s assi%ne$ t" them in that Act

3 Applicati"n "! pr";isi"ns "! Act I "! 1.<24

The unrepeale$ pr";isi"ns "! the C"ntract Act, 1.<2, sa;e in s" !ar as they areinc"nsistent 0ith the e press pr";isi"ns "! this Act, shall c"ntinue t" apply t" /rms

CHAPTER - II

The Nature ! Partnership

= &e/niti"n "! :partnership:, :partner:, :/rm: an$ :/rm name:

>:Partnership: is the relati"n bet0een pers"ns 0h" ha;e a%ree$ t" share the pr"/ts"! a business carrie$ "n by all "r any "! them actin% !"r all

Pers"ns 0h" ha;e entere$ int" partnership 0ith "ne an"ther are calle$ in$i;i$ually:partners: an$ c"llecti;ely :a /rm:, an$ the name un$er 0hich their business iscarrie$ "n is calle$ the /rm name:

Illustrati"ns4

516 A an$ ? buy 1@@ bales "! c"tt"n, 0hich they a%ree t" sell "n their "int acc"untA an$ ? are partners in respect "! such c"tt"n

526 A an$ ? buy 1@@ bales "! c"tt"n, a%reein% t" share the c"tt"n bet0een them A

an$ ? are n"t partners536 A an$ ? a%ree t" 0"r7 t"%ether as carpenters A is t" recei;e all the pr"/ts an$pay a salary t" ?,-A ? are n"t partners

5=6 A an$ ? enter int" a :partnership a%reement 0hereby A is t" ha;e n" share ineither the pr"/ts "r the l"ss "! the business - A an$ ? are n"t partners

5B6 A an$ ? are "int "0ners "! a ship This, by itsel! $"es n"t ma7e them partners

B Partnership n"t create$ by status4

The relati"n "! partnership arises !r"m c"ntract an$ n"t !r"m status

an$, in particular, the members "! a Hin$u un$i;i$e$ !amily carryin% "n a !amilybusiness as such, "r a ?urmese ?u$$hist husban$ an$ 0i!e carryin% "n business assuch are n"t partners in such business



8 +"$e "! $eterminin% e istence "! partnership4

In $eterminin% 0hether a %r"up "! pers"ns is "r is n"t a /rm, "r 0hether a pers"n is"r is n"t a partner in a /rm, re%ar$ shall be ha$ t" the real relati"n bet0een theparties, as sh"0n by all rele;ant !acts ta7en t"%ether

E planati"n 1 The sharin% "! pr"/ts "r "! %r"ss returns arisin% !r"m pr"perty by pers"ns h"l$in% a "int "r c"mm"n interest in that pr"perty $"es n"t "! itsel! ma7e such pers"nspartners

E planati"n 2

The receipt by a pers"n "! a share "! the pr"/ts "! a business, "r "! a paymentc"ntin%ent up"n the earnin% "! pr"/ts "r ;aryin% 0ith the pr"/ts earne$ bybusiness, $"es n"t "! itsel! ma7e him a partner 0ith the pers"ns carryin% "n thebusiness

8A Act n"t t" apply t" certain, relati"nships4

N"thin% c"ntaine$ in this Act shall apply t" a relati"nship create$ by any a%reementbet0een a ban7in% c"mpany an$ a pers"n "r %r"up "! pers"ns pr";i$in% !"r sharin%"! pr"/t an$ l"sses arisin% !r"m "r relatin% t" the pr";isi"n by the ban7in% c"mpany"! /nance t" such pers"n "r %r"up "! pers"ns

E planati"n -

'"r the purp"ses "! this secti"n, :ban7in% c"mpany: an$ :/nance: shall ha;e thesame meanin% as in the ?an7in% Tribunals r$inance, 19.=

< Partnership at 0ill4

here n" pr";isi"n is ma$e by c"ntract bet0een the partners !"r the $urati"n "!their partnership, "r !"r the $eterminati"n "! their partnership, the partnership is:partnership at 0ill:

. Particular Partnership4A pers"n may bec"me a partner 0ith an"ther pers"n in particular a$;entures "run$erta7in%s

CHAPTER-III

Relati"ns "! Partners t" "ne An"ther



9 eneral $uties "! partners4

Partners are b"un$ t" carry "n the business "! the /rm t" the %reatest c"mm"na$;anta%e, t" be ust an$ !aith!ul t" each "ther, an$ t" ren$er true acc"unts an$ !ull

in!"rmati"n "! all thin%s aDectin% the /rm t" any partner "r his le%al representati;e

1@ &uty t" in$emni!y !"r l"ss cause$ by !rau$4

E;ery partner shall in$emni!y the /rm !"r any l"ss cause$ t" it by his !rau$ in thec"n$uct "! the business "! the /rm

11 &eterminati"n "! ri%hts an$ $uties "! partners by c"ntract bet0een the partners4

516 (ub ect t" the pr";isi"ns "! this Act, the mutual ri%hts an$ $uties "! the partners"! a /rm may be $etermine$ by c"ntract bet0een the partners, an$ such c"ntractmay be e press "r may be implie$ by a c"urse "! $ealin%

(uch c"ntract may be ;arie$ by c"nsent "! all the partners, an$ such c"nsent maybe e press "r may be implie$ by a c"urse "! $ealin%

526 A%reements in restraint "! tra$e4 N"t0ithstan$in% anythin% c"ntaine$ in secti"n2< "! the C"ntract Act, 1.<2, I "! 1.<2 such c"ntracts may pr";i$e that a partnershall n"t carry "n any business "ther than that "! the /rm 0hile he is a partner

12 The c"n$uct "! the business4(ub ect t" c"ntract bet0een the partners-

5a6 e;ery partner has a ri%ht t" ta7e part in the c"n$uct "! the business

5b6 e;ery partner is b"un$ t" atten$ $ili%ently t" his $uties in the c"n$uct "! thebusiness

5c6 any $iDerence arisin% as t" "r$inary matters c"nnecte$ 0ith the business maybe $eci$e$ by a ma "rity "! the partners, an$ e;ery partners shall ha;e the ri%ht t"e press his "pini"n be!"re the matter is $eci$e$, but n" chan%e may be ma$e in thenature "! the business 0ith"ut the c"nsent "! all the partners an$

5$6 e;ery partner has a ri%ht t" ha;e access t" an$ t" inspect an$ c"py any "! the

b""7s "! the /rm

13 +utual ri%hts an$ liabilities4

(ub ect t" c"ntract bet0een the partners -

5a6 a partner is n"t entitle$ t" recei;e remunerati"n !"r ta7in% part in the c"n$uct "! the business



5b6 the partners are entitle$ t" share e ually in the pr"/ts earne$, an$ shallc"ntribute e ually t" the l"sses sustaine$ by the /rm

5c6 0here a partner is entitle$ t" interest "n the capital subscribe$ by him suchinterest shall be payable "nly "ut "! pr"/ts

5$6 a partner ma7in%, !"r the purp"ses "! the business, any payment "r a$;ancebey"n$ the am"unt "! capital he has a%ree$ t" subscribe, is entitle$ t" interestthere"n at the rate "! si per cent per annum

5e6 the /rm shall in$emni!y a partner in respect "! payments ma$e an$ liabilitiesincurre$ by him-

5i6 in the "r$inary an$ pr"per c"n$uct "! the business, an$

5ii6 in $"in% such act, in an emer%ency, !"r the purp"se "! pr"tectin% the /rm !r"ml"ss, as 0"ul$ be $"ne by a pers"n "! "r$inary pru$ence, in his "0n case, un$ersimilar circumstances an$

5!6 a partner shall in$emni!y the /rm !"r any l"ss cause$ t" it by his 0ill!ul ne%lect inthe c"n$uct "! the business "! the /rm

1= The pr"perty "! the /rm4

(ub ect t" c"ntract bet0een the partners, the pr"perty "! the /rm inclu$es allpr"perty an$ ri%hts an$ interests in pr"perty "ri%inally br"u%ht int" the st"c7 "! the/rm, "r ac uire$, by purchase "r "ther0ise, by "r !"r the /rm, "r !"r the purp"sesan$ in the c"urse "! the business "! the /rm, an$ inclu$es als" the %""$0ill "! thebusiness

)nless the c"ntrary intenti"n appears, pr"perty an$ ri%hts an$ interests in pr"pertyac uire$ 0ith m"ney bel"n%in% t" the /rm are $eeme$ t" ha;e been ac uire$ !"rthe /rm

1B Applicati"n "! the pr"perty "! the /rm4

(ub ect t" c"ntract bet0een the partners, the pr"perty "! the /rm shall be hel$ an$use$ by the partners e clusi;ely !"r the purp"ses "! the business

18 Pers"nal pr"/ts earne$ by partners4

(ub ect t" c"ntract bet0een the partners,-

5a6 i! a partner $eri;es any pr"/t !"r himsel! !r"m any transacti"n "! the /rm, "r!r"m the use "! the pr"perly "r business c"nnecti"n "! the /rm "r the /rm name, heshall acc"unt !"r that pr"/t an$ pay it t" the /rm



5b6 i! a partner carries "n any business "! the same nature as an$ c"mpetin% 0iththat "! the /rm, he shall acc"unt !"r an$ pay t" the /rm all pr"/ts ma$e by him inthat business

1< Ri%hts an$ $uties "! partners a!ter a chan%e in the /rm4(ub ect t" c"ntract bet0een the partners, -

5a6 0here a chan%e "ccurs in the c"nstituti"n "! a /rm, the mutual ri%hts an$ $uties"! the partners in the rec"nstitute$ /rm remain the same as they 0ere imme$iatelybe!"re the chan%e, as !ar as may be

5b6 a!ter the e piry "! the term "! the /rm, an$4 0here a /rm c"nstitute$ !"r a / e$term c"ntinues t" carry "n business a!ter the e piry "! that term, the mutual ri%htsan$ $uties "! the partners remain the same as they 0ere be!"re the e piry, s" !ar asthey may be c"nsistent 0ith the inci$ents "! partnership at 0ill an$

5c6 0here a$$iti"nal un$er ta7in%s are carrie$ "ut4 0here a /rm c"nstitute$ t" carry"ut "ne "r m"re a$;entures "r un$erta7in%s carries "ut "ther a$;entures "run$erta7in%s, the mutual ri%hts an$ $uties "! the partners in respect "! the "thera$;entures "r un$erta7in%s are the same as th"se in respect "! the "ri%inala$;entures "r un$erta7in%s

CHAPTER - I#

Relati"ns ! Partners T" Thir$ Parties

1. Partner t" be a%ent "! the /rm4-- (ub ect t" the pr";isi"ns "! this Act, a partneris the a%ent "! the /rm !"r the purp"ses "! the business "! the /rm

19 Implie$ auth"rity "! partner as a%ent "! the /rm4

516 (ub ect t" the pr";isi"ns "! secti"n 22, the act "! partner 0hich is $"ne t" carry"n, in the usual 0ay, business "! the 7in$ carrie$ "n by the /rm, bin$s the /rm

The auth"rity "! a partner t" bin$ the /rm c"n!erre$ by this secti"n is calle$ his:implie$ auth"rity:

526 In the absence "! any usa%e "r cust"m "! tra$e t" the c"ntrary, the implie$auth"rity "! a partner $"es n"t emp"0er him t" -

5a6 submit a $ispute relatin% t" the business "! the /rm t" arbitrati"n,

5b6 "pen a ban7in% acc"unt "n behal! "! the /rm in his "0n name,

5c6 c"mpr"mise "r relin uish any claim "r p"rti"n "! a claim by the /rm,



5$6 0ith$ra0 a suit "r pr"cee$in% /le$ "n behal! "! the /rm,

5e6 a$mit any liability in a suit "r pr"cee$in% a%ainst the /rm,

5!6 ac uire imm";eable pr"perty "n behal! "! the /rm,

5%6 trans!er imm";eable pr"perty bel"n%in% t" the /rm, "r

5h6 enter int" partnership "n behal! "! the /rm

2@ E tensi"n an$ restricti"n "! partner>s implie$ auth"rity4

The partners in a /rm may, by c"ntract bet0een the partners, e ten$ "r restrict theimplie$ auth"rity "! any partner

N"t0ithstan$in% any such restricti"n, any act $"ne by a partner "n behal! "! the/rm 0hich !alls 0ithin his implie$ auth"rity bin$s the /rm, unless the pers"n 0ith0h"m he is $ealin% 7n"0s "! the restricti"n "r $"es n"t 7n"0 "r belie;e that partnert" be a partner

21 Partner>s auth"rity in an emer%ency4

A partner has auth"rity, in an emer%ency, t" $" all such acts !"r the purp"se "!pr"tectin% the /rm !r"m l"ss as 0"ul$ be $"ne by a pers"n "! "r$inary pru$ence, inhis "0n case, actin% un$er similar circumstances, an$ such acts bin$ the /rm

22 +"$e "! $"in% act t" bin$ /rm4

In "r$er t" bin$ a /rm, an act "r instrument $"ne "r e ecute$ by a partner "r "therpers"n "n behal! "! the /rm shall be $"ne "r e ecute$ in the /rm name, "r in any"ther manner e pressin% "r implyin% an intenti"n t" bin$ the /rm

23 EDect "! a$missi"ns by a partner4

An a$missi"n "r representati"n ma$e by a partner c"ncernin% the aDairs "! the /rmis e;i$ence a%ainst the /rm, i! it is ma$e in the "r$inary c"urse "! business

2= EDect "! n"tice t" actin% partner4

N"tice t" a partner 0h" habitually acts in the business "! the /rm "! any matterrelatin% t" the aDairs "! the /rm "perates as n"tice t" the /rm, e cept in the case "! a !rau$ "n the /rm c"mmitte$ by "r 0ith the c"nsent "! that partner



2B *iability "! a partner !"r acts "! the /rm4

E;ery partner is liable, "intly 0ith all the "ther partners an$ als" se;erally, !"r allacts "! the /rm $"ne 0hile he is a partner

28 *iability "! the /rm !"r 0r"n%!ul acts "! a partner4

here, by the 0r"n%!ul act "r "missi"n "! a partner actin% in the "r$inary c"urse "!the business "! a /rm, "r 0ith the auth"rity "! his partners, l"ss "r in ury is cause$t" any thir$ party, "r any penalty is incurre$, the /rm is liable there!"r t" the samee tent as the partner

2< *iability "! /rm !"r misapplicati"n by partners4

here --

5a6 a partner actin% 0ithin his apparent auth"rity recei;es m"ney "r pr"perty !r"m athir$ party an$ misapplies it, "r

5b6 a /rm in the c"urse "! its business recei;es m"ney "r pr"perty !r"m a thir$party, an$ the m"ney "r pr"perly is misapplie$ by any "! the partners 0hile it is inthe cust"$y "! the /rm, the /rm is liable t" ma7e %""$ the l"ss

2. H"l$in% "ut4

516 Any "ne 0h" by 0"r$s sp"7en "r 0ritten "r by c"n$uct represents himsel!, "r7n"0in%ly permits himsel! t" be represente$, t" be a partner in a /rm, is liable as apartner in that /rm t" any "ne 0h" has "n the !aith "! any such representati"n%i;en cre$it t" the /rm, 0hether the pers"n representin% himsel! "r represente$ t"be a partner $"es "r $"es n"t 7n"0 that the representati"n has reache$ the pers"ns" %i;in% cre$it

526 here a!ter a partner>s $eath the business is c"ntinue$ in the "l$ /rm name, thec"ntinue$ use "! that name "r "! the $ecease$ partner>s name as a part there"!shall n"t "! itsel! ma7e his le%al representati;e "r his estate liable !"r any act "! the/rm $"ne a!ter his $eath

29 Ri%hts "! trans!eree "! a partner>s Interest4 516 A trans!er by a partner "! hisinterest in the /rm, either abs"lute "r by m"rt%a%e, "r by the creati"n by him "! achar%e "n such interest, $"es n"t entitle the trans!eree, $urin% the c"ntinuance "!the /rm, t" inter!ere in the c"n$uct "! the business, "r t" re uire acc"unts, "r t"inspect the b""7s "! the /rm, but entitles the trans!eree "nly t" recei;e the share "! pr"/ts "! the trans!errin% partner, an$ the trans!eree shall accept the acc"unt "!pr"/ts a%ree$ t" by the partners



526 I! the /rm is $iss"l;e$ "r i! the trans!errin% partner ceases t" be n partner, thetrans!eree is entitle$ as a%ainst the remainin% partners t" recei;e the share "! theassets "! the /rm t" 0hich the trans!errin% partner is entitle$, an$, !"r the purp"se"! ascertainin% that share, t" an acc"unt as !r"m the $ate "! the $iss"luti"n

3@ +in"rs a$mitte$ t" the bene/ts "! partnership4

516 A pers"n 0h" is min"r acc"r$in% t" the la0 t" 0hich he is sub ect may n"t be apartner in a /rm, but, 0ith the c"nsent "! all the partners !"r the time bein%, he maybe a$mitte$ t" the bene/ts "! partnership

526 (uch min"r has a ri%ht t" such share "! the pr"perty an$ "! the pr"/ts "! the /rmas may be a%ree$ up"n, an$ he may ha;e access t" an$ inspect an$ c"py any "!the acc"unts "! the /rm

536 (uch min"r>s share is liable !"r the acts "! the /rm, but the min"r is n"tpers"nally liable !"r any such act

5=6 (uch min"r may n"t sue the partners !"r an acc"unt "r payment "! his share "!the pr"perty "r pr"/ts "! the /rm, sa;e 0hen se;erin% his c"nnecti"n 0ith the /rm,an$ in such case the am"unt "! his share shall be $etermine$ by a ;aluati"n ma$eas !ar as p"ssible in acc"r$ance 0ith the rules c"ntaine$ in secti"n =.

Pr";i$e$ that all the partners actin% t"%ether "r any partner entitle$ t" $iss"l;e the/rm up"n n"tice t" "ther partners may elect in such suit t" $iss"l;e the /rm, an$thereup"n the C"urt shall pr"cee$ 0ith the suit as "ne !"r $iss"luti"n an$ !"rsettlin% acc"unts bet0een the partners, an$ the am"unt "! the share "! the min"rshall be $etermine$ al"n% 0ith the shares "! the partners

5B6 At any time 0ithin si m"nths "! his attainin% ma "rity, "r "! his "btainin%7n"0le$%e that he ha$ been a$mitte$ t" the bene/ts "! partnership, 0hiche;er$ate is later, such pers"n may %i;e public n"tice that he has electe$ t" bec"me "rthat he has electe$ n"t t" bec"me a partner in the /rm, an$ such n"tice shall$etermine his p"siti"n as re%ar$s the /rm4

Pr";i$e$ that, i! he !ails t" %i;e such n"tice, he shall bec"me a partner in the /rm"n the e piry "! the sai$ si m"nths

586 here any pers"n has been a$mitte$ as a min"r t" the bene/ts "! partnership ina /rm, the bur$en "! pr";in% the !act that such pers"n ha$ n" 7n"0le$%e "! sucha$missi"n until a particular $ate a!ter the e piry "! si m"nths "! his attainin%ma "rity shall lie "n the pers"ns assertin% that !act

5<6 here such pers"n bec"mes a partner,-5a6 his ri%hts an$ liabilities as a min"rc"ntinue up t" the $ate "n 0hich he bec"mes a partner, but he als" bec"mespers"nally liable t" thir$ parties !"r all acts "! the /rm $"ne since he 0as a$mitte$t" the bene/ts "! partnership, an$

5b6 his share in the pr"perty an$ pr"/ts "! the /rm shall be the share t" 0hich he0as entitle$ as a min"r



5.6 here such pers"n elects n"t t" bec"me a partner, -

5a6 his ri%hts an$ liabilities shall c"ntinue t" be th"se "! a min"r un$er this secti"nup t" the $ate "n 0hich he %i;es public n"tice

5b6 his share shall n"t be liable !"r any acts "! the /rm $"ne a!ter the $ate "! the

n"tice, an$5c6 he shall be entitle$ t" sue the partners !"r his share "! the pr"perty an$ pr"/ts inacc"r$ance 0ith sub-secti"n 5=6

596 N"thin% in sub-secti"n 5<6 an$ 5.6 shall aDect the pr";isi"ns "! secti"n 2.

CHAPTER - #

Inc"min% An$ ut%"in% Partners

31 Intr"$ucti"n "! a partner4 516 (ub ect t" c"ntract bet0een the partners an$ t"the pr";isi"ns "! secti"n 3@, n" pers"n shall be intr"$uce$ as a partner int" a /rm0ith"ut the c"nsent "! all the e istin% partners

526 (ub ect t" the pr";isi"ns "! secti"n 3@, a pers"n 0h" is intr"$uce$ as a partnerint" a /rm $"es n"t thereby bec"me liable !"r any act "! the /rm $"ne be!"re hebecame a partner

32 Retirement "! a partner4516 A partner may retire --5a6 0ith the c"nsent "! all the "ther partners,

5b6 in acc"r$ance 0ith an e press a%reement by the partners, "r

5c6 0here the partnership is at 0ill, by %i;in% n"tice in 0ritin% t" all the "therpartners "! his intenti"n t" retire

526 A retirin% partner may be $ischar%e$ !r"m any liability t" any thir$ party !"r acts"! the /rm $"ne be!"re his retirement by an a%reement ma$e by him 0ith such thir$party an$ the partners "! the rec"nstitute$ /rm, an$ such a%reement may beimplie$ by a c"urse "! $ealin% bet0een such thir$ party an$ the rec"nstitute$ /rma!ter he ha$ 7n"0le$%e "! the retirement

536 N"t0ithstan$in% the retirement "! a partner !r"m a /rm, he an$ the partnersC"ntinue t" be liable as partners t" thir$ parties !"r any act $"ne by any "! them0hich 0"ul$ ha;e been an act "! the /rm i! $"ne be!"re the retirement, until publicn"tice is %i;en "! the retirement4

Pr";i$e$ that a retire$ partner is n"t liable t" any thir$ party 0h" $eals 0ith the /rm0ith"ut 7n"0in% that he 0as a partner



5=6 N"tices un$er sub-secti"n 536 may be %i;en by the retire$ partner "r by anypartner "! the rec"nstitute$ /rm

33 E pulsi"n "! a partner4

516 A partner may n"t be e pelle$ !r"m a /rm by any ma "rity "! the partners, sa;ein the e ercise in %""$ !aith "! p"0ers c"n!erre$ by c"ntract bet0een the partners

526 The pr";isi"ns "! sub-secti"ns 526, 536 an$ 5=6 "! secti"n 32 shall apply t" ane pelle$ partner as i! he 0ere a retire$ partner

3= Ins"l;ency "! a partner4 516 here a partner in a /rm is a$ u$icate$ an ins"l;enthe ceases t" be a partner "n the $ate "n 0hich the "r$er "! a$ u$icati"n is ma$e,

0hether "r n"t the /rm is thereby $iss"l;e$526 here un$er a c"ntract bet0een the partners the /rm is n"t $iss"l;e$ by thea$ u$icati"n "! a partner as an ins"l;ent, the estate "! a partner s" a$ u$icate$ isn"t liable !"r any act "! the /rm an$ the /rm is n"t liable !"r any act "! theins"l;ent, $"ne alter the $ate "n 0hich the "r$er "! a$ u$icati"n is ma$e

3B *iability "! estate "! $ecease$ partner4

here un$er a c"ntract bet0een the partners the !arm is n"t $iss"l;e$ by the $eath"! a partner, the estate "! a $ecease$ partner is n"t liable !"r any act "! the /rm

$"ne a!ter his $eath

38 Ri%hts "! "ut%"in% partner t" carry "n c"mpetin% business4

516 An "ut%"in% partner may carry "n a business c"mpetin% 0ith that "! the /rman$ he may a$;ertise such business, but, sub ect t" c"ntract t" the c"ntrary, hemay n"t--

5a6 use the /rm name,

5b6 represent himsel! as carryin% "n the business "! the /rm, "r

5c6 s"licit the cust"m "! pers"ns 0h" 0ere $ealin% 0ith the /rm be!"re he cease$ t"be a partner

526 A%reements in restraint "! tra$e4 A partner may ma7e an a%reement 0ith hispartners that "n ceasin% t" be a partner he 0ill n"t carry "n any business similar "that "! the /rm 0ithin a speci/e$ peri"$ "r 0ithin speci/e$ l"cal limits an$,



n"t0ithstan$in% anythin% c"ntaine$ in secti"n 2< "! the C"ntract Act, 1.<2, I "!1.<2 such a%reement shall be ;ali$ i! the restricti"ns imp"se$ are reas"nable

3< Ri%ht "! "ut%"in% partner in certain cases t" share subse uent pr"/ts4

here any member "! a /rm has $ie$ "r "ther0ise cease$ t" be a partner, an$ thesur;i;in% "r c"ntinuin% partners carry "n the business "! the /rm 0ith the pr"perty"! the /rm 0ith"ut any /nal settlement "! acc"unts as bet0een them an$ the"ut%"in% partner "r his estate, then, in the absence "! a c"ntract t" the c"ntrary,the "ut%"in% partner "r his estate is entitle$ at the "pti"n "! himsel! "r hisrepresentati;es t" such share "! the pr"/ts ma$e since he cease$ t" be a partner asmay be attributable t" the use "! his share "! the pr"perty "! the /rm "r t" interestat the rate "! si per cent per annum "n the am"unt "! his share in the pr"perty "!the /rm4

Pr";i$e$ that 0here by c"ntract bet0een the partners an "pti"n is %i;en t"

sur;i;in% "r c"ntinuin% partners t" purchase the interest "! a $ecease$ "r "ut%"in%partner, an$ that "pti"n is $uly e ercise$, the estate "! the $ecease$ partner, "r the"ut%"in% partner "r his estate, as the case may be, is n"t entitle$ t" any !urther "r"ther share "! pr"/ts but i! any partner assumin% t" act in e ercise "! the "pti"n$"es n"t in all material respects c"mply 0ith the terms there"!, he is liable t"acc"unt un$er the !"re%"in% pr";isi"ns "! this secti"n

3. Re;"cati"n "! c"ntinuin% %uarantee by chan%e in /rm4

A c"ntinuin% %uarantee %i;en t" a /rm, "r t" a thir$ party in respect "! thetransacti"ns "! a /rm, is, in the absence "! a%reement t" the c"ntrary, re;"7e$ as t"!uture transacti"ns !r"m the $ate "! any chan%e in the c"nstituti"n "! the /rm

CHAPTER - #I

&iss"luti"n ! A 'irm

39 &iss"luti"n "! a /rm4 The $iss"luti"n "! partnership bet0een all the partners "! a/rm is calle$ the :$iss"luti"n "! the /rm:

=@ &iss"luti"n by a%reement4 A /rm may be $iss"l;e$ 0ith the c"nsent "! all thepartners "r in acc"r$ance 0ith a c"ntract bet0een the partners

=1 C"mpuls"ry $iss"luti"n4 A /rm is $iss"l;e$ -



5a6 by the a$ u$icati"n "! all the partners "r "! all the partners but "ne as ins"l;ent,"r

5b6 by the happenin% "! any e;ent 0hich ma7es it unla0!ul !"r the business "! the/rm t" be car$e$ "n "r !"r the partners t" carry it "n in partnership4

Pr";i$e$ that, 0here m"re than "ne separate a$;enture "r un$erta7in% is carrie$ "nby the /rm, the ille%ality "! "ne "r m"re shall n"t "! itsel! cause the $iss"luti"n "!the /rm in respect "! its la0!ul a$;entures an$ un$erta7in%s

=2 &iss"luti"n "n the happenin% "! certain c"ntin%encies4 (ub ect t" c"ntractbet0een the partners a /rm is $iss"l;e$-

5a6 i! c"nstitute$ !"r a / e$ term, by the e piry "! that term

5b6 i! c"nstitute$ t" carry "ut "ne "r m"re a$;entures "r un$erta7in%s, by thec"mpleti"n there"!

5c6 by the $eath "! a partner an$

5$6 by the a$ u$icati"n "! a partner as an ins"l;ent

=3 &iss"luti"n by n"tice "! partnership at 0ill4 516 here the partnership is at 0ill,the /rm may be $iss"l;e$ by any partner %i;in% n"tice in 0ritin% t" all the "therpartners "! his intenti"n t" $iss"l;e the /rm

526 The /rm is $iss"l;e$ as !r"m the $ate menti"ne$ in the n"tice as the $ate "!$iss"luti"n "r, i! n" $ate is s" menti"ne$, as !r"m the $ate "! the c"mmunicati"n "!

the n"tice

== &iss"luti"n by the C"urt4 At the suit "! a partner, the C"urt may $iss"l;e a /rm"n any "! the !"ll"0in% %r"un$s, namely4-

5a6 that a partner has bec"me "! uns"un$ min$, in 0hich case the suit may bebr"u%ht as 0ell by the ne t !rien$ "! the partner 0h" has bec"me "! uns"un$ min$as by an "ther partner

5b6 that a partner, "ther than the partner suin%, has bec"me in any 0aypermanently incapable "! per!"rmin% his $uties as partner

5c6 that a partner, "ther than the partner suin%, is %uilty "! c"n$uct 0hich is li7ely t"aDect pre u$icially the carryin% "n "! the business, re%ar$ bein% ha$ t" the nature "! the business

5$6 that a partner, "ther than the partner suin%, 0ill!ully "r persistently c"mmitsbreach "! a%reements relatin% t" the mana%ement "! the aDairs "! the /rm "r thec"n$uct "! its business, "r "ther0ise s" c"n$ucts himsel! in matters relatin% t" the



business that it is n"t reas"nably practicable !"r the "ther partners t" carry "n thebusiness in partnership 0ith him

5e6 that a partner, "ther than the partner suin%, has in any 0ay trans!erre$ the0h"le "! his interest in the /rm t" a thir$ party, "r has all"0e$ his share t" bechar%e$ un$er the pr";isi"n "! rule =9 "! r$er I "! the 'irst (che$ule t" the C"$e"! Ci;il Pr"ce$ure, 19@., # "! 19@. "r has all"0e$ it t" be s"l$ in the rec";ery "!arrears "! lan$-re;enue "r "! any $ues rec";erable as arrears "! lan$-re;enue $ueby the partner,

5!6 that the business "! the /rm cann"t be carrie$ "n sa;e at a l"ss "r

5%6 "n any "ther %r"un$ 0hich ren$ers it ust an$ e uitable that the /rm sh"ul$ be$iss"l;e$

=B *iability !"r acts "! partners $"ne a!ter $iss"luti"n4 516 N"t0ithstan$in% the$iss"luti"n "! a /rm, the partners c"ntinue t" be liable as such t" thir$ parties !"rany act $"ne by any "! them 0hich 0"ul$ ha;e been an act "! the /rm i! $"nebe!"re the $iss"luti"n, until public n"tice is %i;en "! the $iss"luti"n4

Pr";i$e$ that the estate "! a partner 0h" $ies, "r 0h" is a$ u$icate$ an ins"l;ent,"r "! a partner 0h", n"t ha;in% been 7n"0n t" the pers"n $ealin% 0ith the /rm t"be a partner, retires !r"m the /rm, is n"t liable un$er this secti"n !"r acts $"ne alterthe $ate "n 0hich he ceases t" be a partner

526 N"tices un$er sub-secti"n 516 may be %i;en by any partner

=8 Ri%ht "! partners t" ha;e business 0"un$ up a!ter $iss"luti"n4 n the $iss"luti"n"! a /rm e;ery partner "r his representati;e is entitle$, as a%ainst all the "therpartners "r their representati;es, t" ha;e the pr"perty "! the /rm applie$ inpayment "! the $ebts an$ liabilities "! the /rm, an$ t" ha;e the surplus $istribute$am"n% the partners "r their representati;es acc"r$in% t" their ri%hts

=< C"ntinuin% auth"rity "! partners !"r purp"ses "! 0in$in% up4 A!ter the $iss"luti"n"! a /rm the auth"rity "! each partner t" bin$ the /rm, an$ the "ther mutual ri%htsan$ "bli%ati"ns "! the partners, c"ntinue n"t0ithstan$in% the $iss"luti"n, s" !ar asmay be necessary t" 0in$ up the aDairs "! the /rm an$ t" c"mplete transacti"nsbe%un but un/nishe$ at the time "! the $iss"luti"n, but n"t "ther0ise4

Pr";i$e$ that the /rm is in n" case b"un$ by the acts "! a partner 0h" has beena$ u$icate$ ins"l;ent but this pr";is" $"es n"t aDect the liability "! any pers"n 0h"has a!ter the a$ u$icati"n represente$ himsel! "r 7n"0in%ly permitte$ himsel! t" berepresente$ as a partner "! the ins"l;ent



=. +"$e "! steelement "! acc"unts bet0een partners4 In settlin% the acc"unts "! a/rm a!ter $iss"luti"n, the !"ll"0in% rules shall, sub ect t" a%reement by the

partners, be "bser;e$4-5a6 *"sses, inclu$in% $e/ciencies "! capital, shall be pai$ /rst "ut "! pr"/ts, ne t "ut"! capital, an$, lastly, i! necessary, by the partners in$i;i$ually in the pr"p"rti"ns in0hich they 0ere entitle$ t" share pr"/ts

5b6 The assets "! the /rm, inclu$in% any sums c"ntribute$ by the partners t" ma7eup $e/ciencies "! capital, shall be applie$ in the !"ll"0in% manner an$ "r$er4-

5i6 in payin% the $ebts "! the /rm t" thir$ parties

5ii6 in payin% t" each partner ratably 0hat is $ue t" him !r"m the /rm !"r a$;ancesas $istin%uishe$ !r"m capital

5iii6 in payin% t" each partner ratably 0hat is $ue t" him "n acc"unt "! capital an$

5i;6 the resi$ue, i! any, shall be $i;i$e$ am"n% the partners in the pr"p"rti"ns in0hich they 0ere entitle$ t" share pr"/ts

=9 Payment "! /rm>s $ebts an$ "! separate $ebts4 here there are "int $ebts $ue!r"m the /rm, an$ als" separate $ebts $ue !r"m any partner, the pr"perty "! the/rm shall be applie$ in the /rst instance in payment "! the $ebts "! the /rm, an$, i!there is any surplus, then the share "! each partner shall be applie$ in payment "!his separate $ebts "r pai$ t" him The separate pr"perty "! any partner shall beapplie$ /rst in the payment "! his separate $ebts, an$ the surplus 5i! any6 in thepayment "! the $ebts "! the /rm

B@ Pers"nal pr"/ts earne$ a!ter $iss"luti"n4 (ub ect t" c"ntract bet0een thepartners, the pr";isi"ns "! clause 5a6 "! secti"n 18 shall apply t" transacti"ns by anysur;i;in% partner "r by the representati;es "! a $ecease$ partner, un$erta7en a!terthe /rm is $iss"l;e$ "n acc"unt "! the $eath "! a partner an$ be!"re its aDairs ha;ebeen c"mpletely 0"un$ up4

Pr";i$e$ that 0here any partner "r his representati;e has b"u%ht the %""$0ill "!

the /rm, n"thin% in this secti"n shall aDect his ri%ht t" use the /rm nameIllustrati"n -

516 A an$ ? carry "n business in partnership The /rm h"l$s leaseh"l$ !"r thepurp"ses "! the business A $ies, ?e!"re the aDairs "! the /rm are c"mpletely 0"ul$up, the lease e pires an$ ? rene0s it The rene0e$ lease is partnership pr"perty



526 A, ? an$ C are partners A a%rees t" ta7e lease in his "0n name, but in !act !"rpartnership purp"ses, an$ $ies be!"re the lease is e ecute$ The representati;es "!A can n"t $eal 0ith the lease 0ith"ut the c"nsent "! ? an$ C4-

B1 Return "! premium "n premature $iss"luti"n4 here a partner has pai$ apremium "n enterin% int" partnership !"r a / e$ term, an$ the /rm is $iss"l;e$be!"re the e pirati"n "! that term "ther0ise than by the $eath "! a partner, he shallbe entitle$ t" repayment "! the premium "r "! such part there"! as may bereas"nable, re%ar$ bein% ha$ t" the terms up"n 0hich he became a partner an$ t"the len%th "! time $urin% 0hich he 0as a partner, unless -

5a6 the $iss"luti"n is mainly $ue t" his "0n misc"n$uct, "r

5b6 the $iss"luti"n is in pursuance "! an a%reement c"ntainin% n" pr";isi"n !"r thereturn "! the premium "r any part "! it

Illustrati"n -

516 A an$ ? entere$ int" partnership as s"licit"rs !"r a term "! se;en years, A payin%a premium "! P"un$ .@@1- t" ?, 0h", be!"re enterin% int" the partnership, 7ne0that A 0as ine perience$ an$ inc"mpetent A!ter the e pirati"n "! t0" years, ?c"mplaine$ that A>s inc"mpetence 0as in uri"us t" the business, an$ calle$ up"nhim t" $iss"l;e the partnership AF thereup"n /les a suit prayin% !"r a $iss"luti"nan$ !"r a return "! a pr"p"rti"nate part "! the premium A is entitle$ t" the return "!a part "! premium pr"p"rti"nate t" the un-e pire$ p"rti"n "! the term4

526 A an$ ? bec"me partner !"r ten years A payin% ? a premium "! p"un$ 1@@@ Auarrel "ccurs at Ghe en$ "! the ei%ht years, b"th parties bein% in 0r"n%, an$ a

$iss"luti"n is $ecree$ A is entitle$ t" a return "! p"un$ 2@@ "! the premium !r"m ?

B2 Ri%hts 0here partnership c"ntract is rescin$e$ !"r !rau$ "r misrepresentati"n4here a c"ntract creatin% partnership is rescin$e$ "n the %r"un$ "! the !rau$ "r

misrepresentati"n "! any "! the parties theret", the party entitle$ t" rescin$ is,0ith"ut pre u$ice t" any "ther ri%ht, entitle$ -

5a6 t" a lien "n, "r a ri%ht "! retenti"n "!, the surplus "r the assets "! the /rmremainin% a!ter the $ebts "! the /rm ha;e been pai$, !"r any sum pai$ by him !"rthe purchase "! a share in the /rm an$ !"r any capital c"ntribute$ by him

5b6 t" ran7 as a cre$it"r "! the /rm in respect "! any payment ma$e by him t"0ar$sthe $ebts "! the /rm an$

5c6 t" be in$emni/e$ by the partner "r partners %uilty "! the !rau$ "rmisrepresentati"n a%ainst all the $ebts "! the /rm



B3 Ri%ht t" restrain !r"m use "! /rm name "r /rm pr"perty4 Alter a /rm is $iss"l;e$,e;ery partner "r his representati;e may, in the absence "! a c"ntract bet0een thepartners t" the c"ntrary, restrain any "ther partner "r his representati;e !r"mcarryin% "n a similar business in the /rm name "r !r"m usin% any "! the pr"perty "!the /rm !"r his "0n bene/t, until the aDairs "! the /rm ha;e been c"mpletely 0"un$

up4Pr";i$e$ that 0here any partner "r his representati;e has b"u%ht the %""$0ill "!the /rm, n"thin% in this secti"n shall aDect his ri%ht t" use the /rm name

B= A%reements in restraint "! tra$e4 Partners may, up"n "r in anticipati"n "! the$iss"luti"n "! the /rm, ma7e an a%reement that s"me "r all "! them 0ill n"t carry "na business similar t" that "! the /rm 0ithin a speci/e$ peri"$ "r 0ithin speci/e$l"cal limits an$ n"t0ithstan$in% anythin% c"ntaine$ in secti"n 2< "! the C"ntractAct, 1.<2, such a%reement shall be ;ali$ i! the restricti"ns imp"se$ are reas"nable

BB (ale "! %""$0ill a!ter $iss"luti"n4 516 In settlin% the acc"unts "! a /rm a!ter$iss"luti"n, the %""$0ill shall, sub ect t" c"ntract bet0een the partners, be inclu$e$in the assets, an$ it may be s"l$ either separately "r al"n% 0ith "ther pr"perty "!the /rm

526 Ri%hts "! buyer an$ seller "! %""$0ill4 here the %""$0ill "! a /rm is s"l$ a!ter$iss"luti"n, a partner may carry "n a business c"mpetin% 0ith that "! the buyer an$he may a$;ertise such business, but, sub ect t" a%reement bet0een him an$ thebuyer, he may n"t-

5a6 use the /rm name,

5b6 represent himsel! as carryin% "n the business "! the /rm, "r

5c6 s"licit the cust"m "! pers"ns 0h" 0ere $ealin% 0ith the /rm be!"re its$iss"luti"n

536 A%reements in restraint "! tra$e4 Any partner may, up"n the sale "! the %""$0ill"! a /rm, ma7e an a%reement 0ith the buyer that such partner 0ill n"t carry "n anybusiness similar t" that "! the /rm 0ithin a speci/e$ peri"$ "r 0ithin speci/e$ l"callimits, an$, n"t0ithstan$in% anythin% c"ntaine$ in secti"n 2< "! the C"ntract Act,

1.<2, I "! 1.<2 such a%reement shall be ;ali$ i! the restricti"ns imp"se$ arereas"nable

CHAPTER - #II

Re%istrati"n ! 'irms



B8 P"0er t" e empt !r"m applicati"n "! this Chapter4 The Pr";incial ";ernment "!any Pr";ince may, by n"ti/cati"n in the " cial a ette, $irect that the pr";isi"ns "! this Chapter shall n"t apply t" that Pr";ince "r t" any part there"! speci/e$ in then"ti/cati"n

B< App"intment "! Re%istrars4 516 The Pr";incial ";ernment may app"intRe%istrars "! 'irms !"r the purp"ses "! this Act, an$ may $e/ne the areas 0ithin0hich they shall e ercise their p"0ers an$ per!"rm their $uties

526 E;ery Re%istrar shall be $eeme$ t" be a public ser;ant 0ithin the meanin% "!secti"n 21 "! the Pa7istan Penal C"$e

B. Applicati"n !"r re%istrati"n4516 The re%istrati"n "! a /rm may be eDecte$ at anytime by sen$in% by p"st "r $eli;erin% t" the Re%istrar "! the area in 0hich any place"! business "! the /rm is situate$ "r pr"p"se$ t" be situate$, a statement in theprescribe$ !"rm an$ acc"mpanie$ by the prescribe$ !ee, statin% -

5a6 the /rm name,

5b6 the place "r principal place "! business "! the /rm

5c6 the names "! any "ther places 0here the /rm carries "n business,

5$6 the $ate 0hen each partner "ine$ the /rm,

5e6 the names in !ull an$ permanent a$$resses "! the partners, an$ 5!6

5!6 the $urati"n "! the /rm

The statement shall be si%ne$ by all the partners, "r by their a%ents speciallyauth"rise$ in this behal!

526 Each pers"n si%nin% the statement shall als" ;eri!y it in the manner prescribe$

536 A /rm name shall n"t c"ntain any "! the !"ll"0in% 0"r$s, namely4-

: ";ernment:, :Jinnah:, :Kuai$-i-A am: "r 0"r$s e pressin% "r implyin% thesancti"n, appr";al "r patr"na%e "! the 'e$eral ";ernment "r any Pr";incial

";ernment "r the Kuai$-i-A am, e cept 0hen the Pr";incial ";ernment si%ni/esits c"nsent t" these "! such 0"r$s as part "! the /rm name by "r$er in 0ritin%

53A6 A /rm name shall n"t c"ntain the name "! the :)nite$ Nati"ns: "r itsabbre;iati"ns thr"u%h the use "! its initial letters "r "! any subsi$iary b"$y set up bythat b"$y unless it has "btaine$ the pre;i"us auth"risati"n "! the (ecretary- eneral"! the )nite$ Nati"ns in 0ritin%

53?6 A /rm name shall n"t c"ntain the name "! the : "rl$ Health r%anisati"n: "rits abbre;iati"ns thr"u%h the use "! its initial letters unless it has "btaine$ thepre;i"us auth"risati"n "! the &irect"r- eneral in 0ritin%



53c6 A /rm name shall n"t c"ntain any 0"r$ 0hich may be $eclare$ by thePr";incial ";ernment, by n"ti/cati"n in the " cial a ette, t" be un$esirable4

Pr";i$e$ that a /rm 0hich has as pa$ "! its name any 0"r$ $eclare$ by thePr";incial ";ernment t" be un$esirable shall, 0ithin "ne m"nth "! such$eclarati"n, alter its name an$ sen$ a statement t" this eDect t" the Re%istrar

B9 Re%istrati"n4 hen the Re%istrar is satis/e$ that the pr";isi"ns "! secti"n B.ha;e been $uly c"mplie$ 0ith, he shall rec"r$ an entry "! the statement in are%ister calle$ the Re%ister "! 'irms, an$ shall /le the statement

8@ Rec"r$in% "! alterati"ns in /rm name an$ principal place "! business4516 henan alterati"n is ma$e in the /rm name "r in the l"cati"n "! the principal place "!business "! a re%istere$ /rm, a statement may be sent t" the Re%istraracc"mpanie$ by the prescribe$ !ee, speci!yin% the alterati"n, an$ si%ne$ an$;eri/e$ in the manner re uire$ un$er secti"n B.

526 hen the Re%istrar is satis/e$ that the pr";isi"ns "! sub-secti"n 516 ha;e been$uly c"mplie$ 0ith, he shall amen$ the entry relatin% t" the /rm in the Re%ister "!'irms in acc"r$ance 0ith the statement, an$ shall /le it al"n% 0ith the statementrelatin% t" the /rm /le$ un$er secti"n B9

81 N"tin% "! cl"sin% an$ "penin% "! branches4 hen a re%istere$ /rm $isc"ntinuesbusiness at any place "r be%ins t" carry "n business at any place, such place n"tbein% its principal place "! business, any partner "r a%ent "! the /rm may sen$intimati"n there"! t" the Re%istrar, 0h" shall ma7e a n"te "! such intimati"n in theentry relatin% t" the /rm in the Re%ister "! 'irms, an$ shall /le the intimati"n al"n%0ith the statement relatin% t" the /rm /le$ un$er secti"n B9

82 N"tin% "! chan%e in name an$ a$$resses "! partners4 hen any partner in are%istere$ /rm alters his name "r permanent a$$ress, an intimati"n "! thealterati"n may be sent by any partner "r a%ent "! the /rm t" the Re%istrar, 0h"shall $eal 0ith it in the manner pr";i$e$ in secti"n 81

83 Rec"r$in% "! chan%es in an$ $iss"luti"n "! a /rm4 516 hen a chan%e "ccurs inthe c"nstituti"n "! a re%istere$ /rm any inc"min%, c"ntinuin% "r "ut%"in% partner,an$ 0hen a re%istere$ /rm is $iss"l;e$ any pers"n 0h" 0as a partner imme$iatelybe!"re the $iss"luti"n, "r the a%ent "! any such partner "r pers"n speciallyauth"rise$ in this behal!, may %i;e n"tice t" the Re%istrar "! such chan%e "r$iss"luti"n, speci!yin% the $ate there"! an$ the Re%istrar shall ma7e a rec"r$ "! then"tice in the entry relatin% t" the /rm in the Re%ister "! 'irms, an$ shall /le then"tice al"n% 0ith the statement relatin% t" the /rm /le$ un$er secti"n B9



526 Rec"r$in% "! 0ith$ra0al "! a min"r4 hen a min"r 0h" has been a$mitte$ t" thebene/ts "! partnership in a /rm attains ma "rity an$ elects t" bec"me "r n"t t"bec"me a partner, an$ the /rm is then a re%istere$ /rm, he, "r his a%ent speciallyauth"rise$ in this behal!, may %i;e n"tice t" the Re%istrar that he has "r has n"tbec"me a partner, an$ the Re%istrar shall $eal 0ith the n"tice in the manner

pr";i$e$ in sub-secti"n 516

8= Recti/cati"n "! mista7e4 516 The Re%istrar shall ha;e p"0er at all times t" recti!yany mista7e in "r$er t" brin% the entry in the Re%ister "! /rms relatin% t" any /rmint" c"n!"rmity 0ith the $"cuments relatin% t" that /rm /le$ un$er this Chapter

526 n applicati"n ma$e by all the parties 0h" ha;e si%ne$ any $"cument relatin%t" the /rm /le$ un$er this Chapter, the Re%istrar may recti!y any mista7e in such$"cument "r in the rec"r$ "r n"te there"! ma$e in the Re%ister "! 'irms

8B Amen$ment "! Re%ister by "r$er "! C"urt4 A c"urt $eci$in% any matter relatin%t" a re%istere$ /rm may $irect that the Re%istrar shall ma7e any amen$ment in theentry in the Re%ister "! 'irms relatin% t" such /rm 0hich is c"nse uential up"n its$ecisi"n an$ the Re%istrar shall amen$ the entry acc"r$in%ly

88 Inspecti"n "! Re%ister an$ /le$ $"cuments4

516 The Re%ister "! 'irms shall be "pen t" inspecti"n by any pers"n "n payment "!such !ee as may be prescribe$

526 All statements, n"tices an$ intimati"ns /le$ un$er this Chapter shall be "pen t"inspecti"n, sub ect t" such c"n$iti"ns an$ "n payment "! such !ee as may beprescribe$

8< rant "! c"pies4The Re%istrar shall "n applicati"n !urnish t" any pers"n, "npayment "! such !ee as may be prescribe$, a c"py, certi/e$ un$er his han$, "! anyentry "r p"rti"n there"! in the Re%ister "! 'irms

8. Rules "! e;i$ence4 516 Any statement, intimati"n "r n"tice rec"r$e$ "r n"te$ inthe Re%ister "! 'irms shall, as a%ainst any pers"n by 0h"m "r "n 0h"se behal! suchstatement, intimati"n "r n"tice 0as si%ne$, be c"nclusi;e pr""! "! any !act thereinstate$



526 A certi/e$ c"py "! an entry relatin% t" a /rm in the Re%ister "! 'irms may bepr"$uce$ in pr""! "! the !act "! the re%istrati"n "! such /rm, an$ "! the c"ntents "!any statement, intimati"n "r n"tice rec"r$e$ "r n"te$ therein

Illustrati"n -

A, ? an$ C are partners in a re%istere$ /rm A retires It 0ill be as necessary !"r A as!"r ? an$ C t" %i;e public n"tice "! his retirement 0hich un$er (ec <2 "! this Act,inclu$es n"tice t" the Re%istrar I! this is n"t $"ne, A 0ill be as much liable !"r theacts "! the c"ntinuin% partners "r "! the /rm as i! A ha$ c"ntinue$ t" be a member"! the /rm An$ "n the "ther han$ the /rm 0ill be liable !"r any act purp"rtin% t" be$"ne by A "n behal! "! the /rm a!ter retirement

89 EDect "! n"n-re%istrati"n4516 N" suit t" en!"rce a ri%ht arisin% !r"m a c"ntract "rc"n!erre$ by this Act shall be institute$ in any C"urt by "r "n behal! "! any pers"nsuin% as a partner in a /rm a%ainst the /rm "r any pers"n alle%e$ t" be "r t" ha;e

been a partner in the /rm unless the /rm is re%istere$ an$ the pers"n suin% is "rhas been sh"0n in the Re%ister "! 'irms as a partner in the /rm

526 N" suit t" en!"rce a ri%ht arisin% !r"m a c"ntract shall be institute$ in any C"urtby "r "n behal! "! a /rm a%ainst any thir$ party unless the /rm is re%istere$ an$ thepers"ns suin% are "r ha;e been sh"0n in the Re%ister "! 'irms as partners in the/rm

536 The pr";isi"ns "! sub-secti"ns 516 an$ 526 shall apply als" t" a claim "! set-"D "r"ther pr"cee$in% t" en!"rce a ri%ht arisin% !r"m a c"ntract, but shall n"t aDect-

5a6 the en!"rcement "! any ri%ht t" sue !"r the $iss"luti"n "! a /rm "r !"r acc"unts"! a $iss"l;e$ /rm, "r any ri%ht "r p"0er t" release the pr"perty "! a $iss"l;e$ /rm,"r

5b6 the p"0ers "! an " cial assi%nee, recei;er "r C"urt un$er the ins"l;ency 'e$eral Territ"ry "! Larachi Act, 19@9M, "r the Pr";incial Ins"l;ency Act, 192@, t" realise thepr"perty "! an ins"l;ent partner

5=6 This secti"n shall n"t apply -

5a6 t" /rms "r t" partners in /rms 0hich ha;e n" place "! business in Pa7istan, "r0h"se places "! business in Pa7istan are situate$ in areas t" 0hich, by n"ti/cati"nun$er secti"n B8, this Chapter $"es n"t apply, "r

5b6 I "! 1..<4 t" any suit "r claim "! set-"D n"t e cee$in% "ne hun$re$ rupees in;alue 0hich, is n"t "! a 7in$ speci/e$ in the (ec"n$ (che$ule t" the Pr";incial (mallCause C"urts Act, 1..<, "r t" any pr"cee$in% in e ecuti"n "r "ther pr"cee$in%inci$ental t" "r arisin% !r"m any such suit "r claim

<@ Penalty !"r !urnishin% !alse particulars4 Any pers"n 0h" si%ns any statement,amen$in% statement, n"tice "r intimati"n un$er this Chapter c"ntainin% any



particular 0hich he 7n"0s t" be !alse "r $"es n"t belie;e t" be true, "r c"ntainin%particulars 0hich he 7n"0s t" be inc"mplete "r $"es n"t belie;e t" be c"mplete,shall be punishable 0ith impris"nment 0hich may e ten$ t" three m"nths, "r 0ith/ne, "r 0ith b"th

<1 P"0er t" ma7e rules4 516 The Pr";incial ";ernment may ma7e rules prescribin%the !ees 0hich shall acc"mpany $"cuments sent t" the Re%istrar "! 'irms, "r 0hichshall be payable !"r the inspecti"n "! $"cuments in the cust"$y "! the Re%istrar "!'irms, "r !"r c"pies !r"m the Re%ister "! 'irms4

Pr";i$e$ that such !ees shall n"t e cee$ the ma imum !ees speci/e$ in (che$ule

Pr";i$e$ !urther that the !ees payable !"r any ser;ice $esire$ "n the same $ay "n0hich an applicati"n !"r the same is ma$e may be $"uble the a!"resai$ ma imum!ees

526 The pr";incial ";ernment, may als" ma7e rules -

5a6 prescribin% the !"rm "! statement submitte$ un$er secti"n B., an$ "! the;eri/cati"n there"!

5b6 re uirin% statements, intimati"ns an$ n"tices un$er secti"ns 8@, 81, 82 an$ 83t" be in prescribe$ !"rm, an$ prescribin% the !"rm there"!

5c6 prescribin% the !"rm "! the Re%ister "! 'irms, an$ the m"$e in 0hich entriesrelatin% t" /rms are t" be ma$e therein, an$ the m"$e in 0hich such entries are t"be amen$e$ "r n"tes ma$e therein

5$6 re%ulatin% the pr"ce$ure "! the Re%istrar 0hen $isputes arise

5e6 re%ulatin% the /lin% "! $"cuments recei;e$ by the Re%istrar

5!6 prescribin% c"n$iti"ns !"r the inspecti"n "! "ri%inal $"cuments

5%6 re%ulatin% the %rant "! c"pies

5h6 re%ulatin% the eliminati"n "! re%isters an$ $"cuments

5i6 pr";i$in% !"r the maintenance an$ !"rm "! an in$e t" the Re%ister "! 'irms an$

5 6 %enerally, t" carry "ut the purp"ses "! this Chapter

536 All rules ma$e un$er this secti"n shall be sub ect t" the c"n$iti"n "! pre;i"us

publicati"n

CHAPTER - #III

(upplemental



<2 +"$e "! %i;in% public n"tice4 A public n"tice un$er this Act is %i;en --

5a6 0here it relates t" the retirement "r e pulsi"n "! a partner !r"m a re%istere$/rm, "r t" the $iss"luti"n "! a re%istere$ /rm, "r t" the electi"n t" bec"me "r n"t t"bec"me a partner in a re%istere$ /rm by a pers"n attainin% ma "rity 0h" 0asa$mitte$ as a min"r t" the bene/ts "! partnership, by n"tice t" the Re%istrar "!'irms un$er secti"n 83, an$ by publicati"n in the " cial a ette an$ in at least "ne;ernacular ne0spaper circulatin% in the $istrict 0here the /rm t" 0hich it relateshas its place "r principal place "! business, an$

5b6 in any "ther case, by publicati"n in the " cial a ette an$ in at least "ne;ernacular ne0spaper circulatin% in the $istrict 0here the /rm t" 0hich it relateshas its place "r principal place "! business

<3 Repeals M Rep by the Repealin% Act, 193. 5I "! 193., ( 2 an$ (che$ule

<= N"thin% in this Act "r any repeal eDecte$ thereby shall aDect "r be $eeme$ t"aDect - 5a6 any ri%ht, title, interest, "bli%ati"n "r liability alrea$y ac uire$, accrue$"r incurre$ be!"re the c"mmencement "! this Act, "r

5b6 any le%al pr"cee$in% "r reme$y in respect "! any such ri%ht, title, interest,"bli%ati"n "r liability, "r anythin% $"ne "r suDere$ be!"re the c"mmencement "!this Act, "r

5c6 anythin% $"ne "r suDere$ be!"re the c"mmencement "! this Act, "r

5$6 any enactment relatin% t" partnership n"t e pressly repeale$ by this Act, "r

5e6 any rule "! ins"l;ency relatin% t" partnership, "r

5!6 any rule "! la0 n"t inc"nsistent 0ith this Act

(CHE&)*E

+a imum 'ees

(ee sub-sec 516 "! (ec <1

&"cument "r act in respect "! 0hich the !ee is payable

+a imum 'ees

Rs

1



2

(tatement un$er (ecti"n B.

B@

(tatement un$er (ecti"n 8@

2@

Intimati"n un$er (ecti"n 81

2@

Intimati"n un$er (ecti"n 82

2@

N"tice un$er (ecti"n 83

2@

Applicati"n un$er (ecti"n 8=

2@

Inspecti"n "! the Re%ister "! 'irms un$er sub-secti"n 516 "! (ecti"n 88

B

Inspecti"n "! $"cuments relatin% t" a /rm un$er sub-secti"n 526 "! (ecti"n 88 "r any"ther $"cument in the cust"$y "! the Re%istrar "! 'irms

B

C"pies !r"m the Re%ister "! 'irms

Rs 2 !"r each 1@@ 0"r$s "r part there"! :



APPEN&I I

(PECI+EN ' R+ ' A PARTNER(HIP &EE&

This a%reement ma$e at Larachi this 1st $ate "! July, 199@, bet0een A?, +uslim,a$ult, resi$in% at Larachi "! the "ne part AN&, C&, +uslim, a$ult, resi$in% atLarachi, "! the "ther part

HEREA( the party "! the ne Part an$ the party "! the ther Part ha;e a%ree$ t"enter int" a partnership business up"n the terms an$ c"n$iti"ns herein c"ntaine$

N"0 there!"re these presents 0itness -An$ it is hereby a%ree$ bet0een the partiesheret" as !"ll"0s4

1 This &ee$ "! Partnership shall c"me int" !"rce 0ith eDect !r"m the /rst $ay "!April, 199@

2 The partnership business shall c"nsist "! sale, purchase an$ manu!acture "! $yesan$ chemicals, an$ all 7in$s "! a%ency business, 0hether manu!acturin% "r"ther0ise, an$O"r such "ther business as may be $eci$e$ by the partners !r"m timet" time

3 The partnership shall be carrie$ "n in the name an$ style "! :A? ("ns:

= The partnership shall be a partnership at 0ill

B The partnership business shall be c"n$ucte$ at Larachi an$O"r at such "therplace "r places as shall be a%ree$ t" by the partners !r"m time t" time

8 ?"th the partners shall initially in;est Rs 1@,@@@ each an$ the am"unts s"

in;este$ by the partners shall !"rm tile capital "! the partnership, an$ the sameshall be use$ as per these present in the partnership business

< 'urther capital, i! any, re uire$ by the partnership shall be "btaine$ !r"m time t"time by the partnership by 0ay "! l"ans hun$ies "r "ther0ise !r"m thir$ parties "npayment "! interest at the mar7et rate, an$ such interest shall be pai$ "ut "! thepartnership !un$s irrespecti;e "! pr"/ts an$ l"sses "! the sai$ business



. The net pr"/ts "! the partnership business shall, a!ter meetin% all the necessaryc"sts, char%es an$ e penses incurre$ in carryin% "n the sai$ partnership business,be $i;i$e$ in the !"ll"0in% pr"p"rti"n4

5a6 A? B@P in the rupee5b6 C& B@P in the rupee

any they shall in the li7e pr"p"rti"n bear all l"sses, inclu$in% l"ss "! capital

9 The pr"/ts an$ l"sses "! the partnership shall be $etermine$ as "n the 3@th $ay"! June each year, an$ the same shall be $istribute$ t", "r rec";ere$ !r"m, thepartners c"ncerne$ in the pr"p"rti"n a!"resai$

1@ It is hereby a%ree$ that each "! the partners shall be entitle$ t" $ra0 Rs 1,@@@5Rupees "ne th"usan$ "nly6 per m"nth !"r his pers"nal e penses 0ith"ut thec"nsent "! the "ther partner, an$ such $ra0in% shall be $ebite$ t" his pers"nalacc"unt, an$ the sum s" $ra0n shall be in part "r !ull satis!acti"n, as the case maybe, "! the share "! the sai$ partner in the pr"/ts "! the sai$ partnership business !"rthat year

PR #I&E& A* A ( that i! in any year, the sum $ra0n as a!"resai$ by the partnershall e cee$ the am"unt "! his share "! the net pr"/ts !"r that year, the sai$ partnershall re!un$ the e cess t" the partnership as s""n as the same shall be ascertaine$"r !r"m his share "! the pr"/ts "! the subse uent year "r years

11 The partners shall "pen "ne "r m"re current acc"unts 0ith any ?an7 "r ?an7s inthe name "! the partnership, an$ the acc"unt "r acc"unts s" "pene$ shall be"perate$ by either partner

12 ?"th the partners shall ha;e !ull p"0er an$ auth"rity t" $ra0 che ues, 0ith$ra0cash thr"u%h si%ne$ che ues, ";er$ra0 !r"m ?an7 "r ?an7s, ta7e l"ans, securecre$its, si%n bills "! e chan%e an$ any "ther le%al instrument "r instruments,en$"rse hun$ies, app"int att"rney "r att"rneys !"r an$ t" c"mmence, c"ntinue,

$e!en$, c"mp"un$ "r settle any suit, pr"secuti"n "r any le%al pr"cee$in% !"r "ra%ainst the partnership,

PR #I&E& A* A ( that in each such case, the appr";al "r rati/cati"n "! the "therpartner shall in;ariably be "btaine$



13 All partnership m"ney, bills, n"tes, che ues an$ "ther securities recei;e$ by thepartnership shall, as an$ 0hen recei;e$, be pai$ an$ $ep"site$ in the ?an7 "r?an7s t" the cre$it "! the /rm>s acc"unt, e cept such sums as are imme$iatelyre uire$ t" meet the current e penses

1= The acc"unts "! the sai$ partnership shall be pr"perly maintaine$ an$ 7ept atthe " ce "! the partnership, an$ shall be ma$e up an$ prepare$ at the cl"se "!each year en$in% "n the 3@th $ay "! June an$ the (ame shall be si%ne$ by b"th thepartners

1B N"ne "! the partners heret" shall ple$%e the cre$it "! the sai$ business "! thepartnership, e cept in the usual an$ re%ular c"urse "! business, "r %i;e cre$it t" "rc"n$uct any business !"r any "ther /rm, c"mpany "r pers"n

18 The m"ney c"nstitutin% the net pr"/ts ma$e "n such yearly acc"unt asa!"resai$, a!ter $e$uctin% all the e penses, salaries, 0a%es, ta es, etc , may be0ith$ra0n by each partner respecti;ely entitle$ theret" acc"r$in% t" his respecti;eshare as herein be!"re pr";i$e$ 5less such sums as may ha;e been pre;i"usly$ra0n "n acc"unt by such partner6

1< In the e;ent "! any partner $esirin% t" retire, !"r any reas"n 0hats"e;er, !r"mthe sai$ partnership, he shall %i;e a pre;i"us n"tice "! three m"nths t" that eDect

n such n"tice bein% recei;e$ by the /rm, the acc"unt b""7s "! the /rm shall bebr"u%ht up-t"-$ate an$ a balance-sheet as at the en$ "! the peri"$ "! the sai$n"tice shall be ma$e up The "ut%"in% partner shall be pai$ his share "! the netpr"/ts as "n the $ate "! retirement an$ shall be re uire$ t" pay all his $ues "r$ebts, i! any, t" the /rm, an$ a!ter all the claims an$ $ues "! an$O"r a%ainst the /rmare satis/e$, he shall be $eeme$ t" be !ree !r"m the partnership, an$ the "therpartners shall be $eeme$ t" be !ree !r"m the partnership, an$ the "ther partnersshall be entitle$ t" c"ntinue the business "! the partnership as the s"le pr"priet"rthere"! The partner thus %"in% "ut shall be entitle$ t" the ri%hts "! the %""$0ill "!the /rm t" the e tent "! his share in the partnership

1. In the e;ent "! $eath "! either "! the partners "ccurrin% $urin% the currency "!the sai$ partnership, the sur;i;in% partner shall be entitle$ t" c"ntinue an$ carry "nthe sai$ business in partnership 0ith the le%al heirs, success"rs "r le%alrepresentati;e "! the $ecease$ partner, an$ i! such heirs, success"rs "r le%alrepresentati;es "! the $ecease$ partner $eci$e n"t t" carry "n the sai$ business inpartnership, then the sur;i;in% partner may carry "n the sai$ business as the s"lepr"priet"r there"! in the same name an$ style, a!ter 0"r7in% "ut an$ payin% the$ues an$ claims "! the $ecease$ partner t" his heirs, success"rs "r le%al



representati;es, as the case may be, 0h" shall ha;e !ull p"0er t" inspect acc"untsan$ "btain such in!"rmati"n as may be necessary !"r ascertainin% that the share "!the $ecease$ has been pr"perly 0"r7e$ "ut an$ pai$ The share "! the $ecease$shall inclu$e his share in the %""$0ill "! the /rm

19 Any $ispute "r uesti"n 0hich may arise in the business "! the sai$ partnershipin c"nnecti"n 0ith any matter bet0een the partners "r the sur;i;in% partner an$the heirs, success"rs "r le%al representati;es "! the $ecease$ partner, 0hether$urin% the currency "! this A%reement "r a!ter the terminati"n there"!, relatin% t" "rarisin% "ut "! the business "! the partnership "r "! this A%reement (uch arbitrati"nshall be hel$ at Larachi, an$ shall be %";erne$ by the pr";isi"ns "! the Arbitrati"nAct !"r the time bein% in !"rce in Pa7istan, an$ the Arbitrati"n A0ar$ shall bebin$in% "n the parties t" the $ispute

IN ITNE(( HERE ' the parties heret" ha;e hereunt" set an$ subscribe$ theirrespecti;e han$s an$ seals the $ay an$ year /rst herein ab";e 0ritten

(I NE& (EA*E& AN& &E*I#ERE& by the 0ithin name$

A?, in the presence "! QQQQQQQQQQQQQQQQ

5(i%nature "! A?6

(I NE& (EA*E& AN& &E*I#ERE& by the 0ithin

C&, in the presence "! QQQQQQQQQQQQQQQQQQQname$

5(i%nature "! C&6

APPEN&I II

(PECI+EN ' R+ ' A &I(( *)TI N &EE&

THI( &EE& ma$e at Larachi this 1st $ay "! +arch, 199@, bet0een A? "! Larachi,+uslim a$ult, resi$in% at Larachi "! the 'irst Part an$ C&, +uslim a$ult, resi$in% atLarachi "! the "ther part

HEREA( the party "! the 'irst Part an$ the party "! the ther Part ha;e entere$int" a Partnership business in $yes an$ chemicals un$er a &ee$ "! Partnership$ate$ the 1st $ay "! January, 19..

AN& HEREA( the sai$ Partnership 0as a partnership at 0ill



AN& HEREA( "n acc"unt "! $isputes bet0een the partners, it has been $eci$e$ byan$ bet0een the partners that the sai$ partnership shall be $iss"l;e$ "n the termsan$ c"n$iti"ns hereina!ter appearin%4

N THI( &EE& ITNE(( as !"ll"0s41 The sai$ partnership entere$ int" un$er the &ee$ "! Partnership $ate$ the 1st$ay "! January, 19.. is hereby $iss"l;e$ 0ith eDect !r"m the $ate "! this &ee$

2 The party "! the 'irst Party hereby a%rees an$ un$erta7es t" n"ti!y the $iss"luti"n"! the partnership t" the Re%istrar "! 'irms an$ als" %i;e n"tice there"! in a l"calne0spaper, 0ithin 21 $ays !r"m the $ate "! the e ecuti"n here"!

3 The assets an$ liabilities "! the partnership, ha;e been assesse$ an$ the /nalbalance-sheet an$ pr"/t an$ l"ss acc"unt ha;e been ta7en t" the mutualsatis!acti"n "! b"th the parties heret"

= n the $iss"luti"n "! the partnership, the assets an$ liabilities "! the /rm as perthe balance-sheet a!"resai$ t"%ether 0ith the st"c7s, securities %""$0ill, tenancyri%hts an$ all "ther assets "! the /rm ha;e been all"tte$ an$ assi%ne$ t" the party"! the 'irst Part, 0h" has pai$ t" the party "! the ther Part a sum "! Rs5Rupees "nly, the receipt 0here"! the party "! the ther part herebyac7n"0le$%es6 in part-payment "! his share in the net $i;isible assets "! the /rm

an$ has %i;en t" the party "! the ther Part a Pr"miss"ry N"te !"r a sum "! Rs5Rupees "nly6 payable "n 1st &ecember 199@ 0ith interest at 1@ per centannum bein% the balance "! his share in the assets "! the /rm

B The party "! the ther part hereby releases, %rants, assi%ns an$ c"n;eys A** hisshare, ri%ht, title an$ interest in the sai$ partnership business an$ pr"perties,inclu$in% the %""$0ill an$ tenancy ri%hts there"! T H *& the same int" the party"! the 'irst Part abs"lutely

8 The party "! the 'irst Part hereby c"n;enants 0ith the party "! the ther Part thathe shall $ischar%e all the liabilities an$ "bli%ati"n "! the partnership an$ shalleDecti;ely in$emni!y an$ c"ntinue t" in$emni!y the party "! the ther Part a%ainstclaims an$ e penses in respect there"!



< The party "! the ther Part shall n"t, !"r a peri"$ "! B years !r"m the $ate here"!,en%a%e himsel! $irectly "r in$irectly in the business "! $yes an$ chemicals 0ithin ara$ius "! 2 miles !r"m the premises "! the partnership sh"p

. )nless repu%nant t" the c"nte t "r meanin% there"!, the e pressi"ns :the party"! the 'irst Part: an$ :the party "! the ther Part: shall inclu$e their respecti;eheirs, representati;es, success"rs an$ assi%ns

IN ITNE(( HERE ' the parties heret" ha;e hereunt" set an$ subscribe$ theirrespecti;e han$s an$ seals the $ay an$ year /rst herein ab";e 0ritten

(I NE& (EA*E& AN&&E*I#ERE& by the 0ithin name$

A? in the presence "!4

5(i%nature "! A?6(I NE& (EA*E& AN&&E*I#ERE& by the 0ithin name$

C& in the presence "!4

5(i%nature "! C&6

APPEN&I III

THE C NTRACT ACT5I ' 1.<26

CHAPTER l

5(s 239- 2886

' PARTNER(HIP

239 :Partnership $e/ne$:4 :Partnership: is the relati"n 0hich subsists bet0eenpers"ns 0h" ha;e a%ree$ t" c"mbine their pr"perty, lab"ur "r s7ill in s"mebusiness, an$ t" share the pr"/ts there"! bet0een them

:'irms $e/ne$:4 Pers"ns 0h" ha;e entere$ int" partnership 0ith "ne an"ther arecalle$ c"llecti;ely a :/rm:

Illustrati"ns

5a6 A an$ ? buy 1@@ bales "! c"tt"n, 0hich they a%ree t" sell !"r their "int acc"untA an$ ? are partners in respect "! such c"tt"n



5b6 A an$ ? buy 1@@ bales "! c"tt"n, a%reein% t" share it bet0een them A an$ H aren"t partners

5c6 A a%rees 0ith ?, a %"l$smith, t" buy an$ !urnish %"l$ t" ?, t" be 0"r7e$ up byhim an$ s"l$, an$ that they shall share in the resultin% pr"/t "r l"ss A an$ ? arepartners

5$6 A an$ ? a%ree t" 0"r7 t"%ether as carpenters, but that A shall recei;e all pr"/tsan$ shall pay 0a%es t" ? A an$ ? are n"t partners

5e6 A an$ ? are "int "0ners "! a ship This circumstances $"es n"t ma7e thempartners

2=@ *en$er n"t a partner by a$;ancin% m"ney !"r share "! pr"/t4 A l"an t" a pers"nen%a%e$ "r ab"ut t" en%a%e in any tra$e "r un$erta7in% up"n a c"ntract 0ith suchpers"n that the len$er shall recei;e interest at a rate ;aryin% 0ith the pr"/ts "r thathe shall recei;e a share "! the pr"/ts, $"es n"t, "! itsel!, c"nstitute the len$er apartner, "r ren$er him resp"nsible as such

2=1 Pr"perty le!t in business by retirin% partner, "r $ecease$ partner>srepresentati;e4 In the absence "! any c"ntract t" the c"ntrary, pr"perty le!t by aretirin% partner, "r the representati;e "! a $ecease$ partner, t" be use$ in thebusiness is t" be c"nsi$ere$ a l"an 0ithin the meanin% "! the last prece$in% secti"n

2=2 (er;ant "r a%ent remunerate$ by share "! pr"/ts n"t a partner4 N" c"ntract !"r

the remunerati"n "! a ser;ant "r a%ent "! any pers"n, en%a%e$ in any tra$e "run$erta7in%, by a share "! the pr"/ts "! such tra$e "r un$erta7in% shall, "r itsel!,ren$er such ser;ant "r a%ent resp"nsible as a partner therein, n"r %i;e him theri%hts "! a partner

2=3 i$"0 "r chil$ "! $ecease$ partner recei;in% annuity "ut "! pr"/ts n"t apartner4 N" pers"n, bein% a 0i$"0 "r chil$ "! a $ecease$ partner "! a tra$er an$recei;in% by 0ay "! annuity a pr"p"rti"n "! the pr"/ts ma$e by such tra$er in hisbusiness, shall, by reas"n "nly "! such receipt, be $eeme$ t" be partner "! suchtra$er, "r be sub ect t" any liabilities incurre$ by him

2== Pers"n recei;in% p"rti"n "! pr"/ts !"r sale "! %""$0ill n"t a partner4 N" pers"nrecei;in%, by 0ay "! annuity "r "ther0ise, a p"rti"n "! the pr"/ts "! any business, inc"nsi$erati"n "! the sale by him "! the %""$0ill "! such business, shall by reas"n"nly "! such receipt, be $eeme$ t" be a partner "! the pers"n carryin% "n suchbusiness, "r be sub ect t" his liabilities



2=B Resp"nsibility "! pers"n lea$in% an"ther t" belie;e him a partner4 A pers"n0h" has, by 0"r$s sp"7en "r 0ritten "r by his c"n$uct, le$ an"ther t" belie;e thathe is a partner in a particular /rm is resp"nsible t" him as partner in such /rm

2=8 *iability "! pers"n permittin% himsel! t" be represente$ as a partner4 Any "nec"nsentin% t" all"0 himsel! t" be represente$ as a partner is liable, as such, t" thir$pers"ns 0h", "n the !aith there"!, %i;e cre$it t" the partnership

2=< +in"r partner n"t pers"nally liable but his share is4 A pers"n 0h" is un$er thea%e "! ma "rity acc"r$in% t" the la0 t" 0hich he is sub ect may be a$mitte$ t" thebene/ts "! the partnership, but cann"t be ma$e pers"nally liable !"r any "bli%ati"n"! the /rm but the share "! such min"r in the pr"perty "! the /rm is liable !"r the"bli%ati"ns "! the /rm

2=. *iability "! min"r partner "n attainin% ma "rity4 A pers"n 0h" has beena$mitte$ t" the bene/ts "! partnership un$er the a%e "! ma "rity bec"mes, "nattainin% that a%e, liable !"r all "bli%ati"ns incurre$ by the partnership since he 0ass" a$mitte$, unless he %i;es public n"tice 0ithin a reas"nable time, "! hisrepu$iati"n "! the partnership

2=9 Partner>s liability !"r $ebts "! partnership4 E;ery partner is liable !"r all $ebts

an$ "bli%ati"ns incurre$ 0hile he is a partner in the usual c"urse "! business by "r"n behal! "! the partnership but a pers"n 0h" is a$mitte$ as a partner int" ane istin% /rm $"es n"t thereby bec"me liable t" the cre$it"rs "! such /rm !"ranythin% $"ne be!"re he became a partner

2B@ Partner>s liability t" thir$ pers"n !"r ne%lect "r !rau$ "! c"-partner4 E;erypartner is liable t" ma7e c"mpensati"n t" thir$ pers"ns in respect "! l"ss "r $ama%earisin% !r"m the ne%lect "r !rau$ "! any partner in the mana%ement "! the business"! the /rm

2B1 Partner>s p"0er t" bin$ c"-partners4 Each partner 0h" $"es any act necessary!"r, "r usually $"ne in, carryin% "n the business "!

such a partnership as that "! 0hich he is a member bin$s his c"-partners t" thesame e tent as i! he 0ere their a%ent $uly app"inte$ !"r that purp"se

E cepti"n4 I! it has been a%ree$ bet0een the partners that any restricti"n shall beplace$ up"n the p"0er "! any "ne "! them, n" act $"ne in c"ntra;enti"n "! such



a%reement shall bin$ the /rm 0ith respect t" pers"ns ha;in% n"tice "! sucha%reement

Illustrati"ns

5a6 A an$ ? tra$e in partnership, A resi$in% in En%lan$, an$ ? in Pa7istan A $ra0s a

bill "! e chan%e in the name "! the /rm ? has n" n"tice "! the bill, n"r, is he at allintereste$ in the transacti"n The /rm is liable "n the bill, pr";i$e$ the h"l$er $i$n"t 7n"0 "! the circumstances un$er 0hich the bill 0as $ra0n

5b6 A, bein% "ne "! a /rm "! s"licit"rs an$ att"rneys, $ra0s a bill "! e chan%e in thename "! the /rm 0ith"ut auth"rity The "ther partners are n"t liable "n the bill

5c6 A an$ ? carry "n business in partnership as ban7ers A sum "! m"ney is recei;e$by A "n behal! "! the /rm A $"es n"t in!"rm ? "!

such receipt, an$ a!ter0ar$s A appr"priates the m"ney t" his "0n use Thepartnership is liable t" ma7e %""$ the m"ney

5$6 A an$ ? are partners A 0ith the intenti"n "! cheatin% ?, %"es t" a sh"p an$purchases articles "n behal! "! the /rm, such as mi%ht be use$ in the "r$inaryc"urse "! the partnership business an$ c"n;erts them t" his "0n separate use,there bein% n" c"llusi"n bet0een him an$ the seller The /rm is liable !"r the price"! the %""$s

2B2 Annulment "! c"ntract $e/nin% partners, ri%hts an$ "bli%ati"ns4 herepartners ha;e by c"ntract re%ulate$ an$ $e/ne$, as bet0een themsel;es, theirri%hts an$ "bli%ati"ns, such c"ntract can be annulle$ "r altere$ "nly by c"nsent "!all "! them, 0hich c"nsent must either be e presse$, "r be implie$ !r"m a uni!"rmc"urse "! $ealin%

Illustrati"ns

A, ? an$ C, inten$in% t" enter int" partnership, e ecute 0ritten articles "!a%reement, by 0hich it is stipulate$ that the net pr"/ts arisin% !r"m the partnershipbusiness shall be e ually $i;i$e$ bet0een them A!ter0ar$s they carry "n thepartnership business !"r many years A recei;in% "ne-hal! "! the net pr"/ts an$ the"ther hal! bein% $i;i$e$ e ually bet0een ? an$ C All parties 7n"0 "! an$ ac uiescein this arran%ement This c"urse "! $ealin% superse$es the pr";isi"n in the articlesas t" the $i;isi"n "! pr"/ts

2B3 Rule $eterminin% partners> mutual relati"ns, 0here n" c"ntract t" c"ntrary4 Inthe absence "! any c"ntract t" the c"ntrary the relati"ns "! partners t" each "therare $etermine$ by the !"ll"0in% rules4-

516 all partners are "int "0ners "! all pr"perty "ri%inally br"u%ht int" thepartnership st"c7, "r b"u%ht 0ith m"ney bel"n%in% t" the partnership, "r ac uire$!"r the purp"ses "! the partnership business All such pr"perty is calle$ partnership



pr"perty The share "! each partner in the partnership pr"perty is the ;alue "! his"ri%inal c"ntributi"n, increase$ "r $iminishe$ by his share "! pr"/ts "r l"ss

526 all partners are entitle$ t" share e ually in the pr"/ts "! the partnershipbusiness, an$ must c"ntribute e ually t"0ar$s the l"sses sustaine$ by thepartnership

536 each partner has a ri%ht t" ta7e part in the mana%ement "! the partnershipbusiness

5=6 each partner is b"un$ t" atten$ $ili%ently t" the business "! the partnership, an$is n"t entitle$ t" any remunerati"n !"r actin% in such business

5B6 0hen $iDerences arise as t" "r$inary matters c"nnecte$ 0ith the partnershipbusiness, the $ecisi"n shall be acc"r$in% t" the "pini"n "! the ma "rity "! thepartners but n" chan%e in the nature "! the business "! the partnership can bema$e, e cept 0ith the c"nsent "! all the partners

586 n" pers"n can intr"$uce a ne0 partner int" a /rm 0ith"ut the c"nsent "! all thepartners

5<6 i! !r"m any cause 0hats"e;er any member "! a partnership ceases t" be s", thepartnership is $iss"l;e$ as bet0een all the "ther members

5.6 unless the partnership has been entere$ int" !"r a / e$ term, any partner mayretire !r"m it at any time

596 0here a partnership has been entere$ int" !"r a / e$ term, n" partner can,$urin% such term, retire e cept 0ith the c"nsent "! all the partners, n"r can he bee pelle$ by his partners !"r any cause 0hate;er, e cept by "r$er "! C"urt

51@6 partnerships, 0hether entere$ int" !"r a / e$ term "r n"t, are $iss"l;e$ by the$eath "! any partner

2B= hen C"urt may $iss"l;e partnership4 At the suit "! a partner the C"urt may$iss"l;e the partnership in the !"ll"0in% cases4-

516 0hen a partner bec"mes "! uns"un$ min$

526 0hen a partner, "ther than the partner suin%, has been a$ u$icate$ an ins"l;entun$er any la0 relatin% t" ins"l;ent $ebt"rs

536 0hen a partner, "ther than the partner suin%, has $"ne any act by 0hich the0h"le interest "! such partner is le%ally trans!erre$ t" a thir$ pers"n

5=6 0hen any partner bec"mes incapable "! per!"rmin% his part "! the partnershipc"ntract

5B6 0hen a partner, "ther than the partner suin%, is %uilty "! %r"ss misc"n$uct in theaDairs "! the partnership "r t"0ar$s his partners

586 0hen the business "! the partnership can "nly be carrie$ "n at a l"ss



2BB &iss"luti"n "! partnership by pr"hibiti"n "! business4 A partnership is in allcases $iss"l;e$ by its business bein% pr"hibite$ by la0

2B8 Ri%hts an$ bli%ati"ns "! partners in partnership c"ntinue$ a!ter e piry "! term!"r 0hich it 0as entere$ int"4 I! a partnership entere$ int" !"r a / e$ term bec"ntinue$ a!ter such term has e pire$, the ri%hts an$ "bli%ati"ns "! the partners0ill, in the absence "! any a%reement t" the c"ntrary, remain the same as they0ere at the e pirati"n "! the term, s" !ar as such ri%hts an$ "bli%ati"ns can beapplie$ t" a partnership $iss"l;able at the 0ill "! any partner

2B< eneral $uties "! partners4 Partners are b"un$ t" carry "n the business "! thepartnership !"r the %reatest c"mm"n a$;anta%e, t" be ust an$ !aith!ul t" each"ther, an$ t" ren$er true acc"unts an$ !ull in!"rmati"n "! all thin%s aDectin% thepartnership t" any partner "r his le%al representati;es

2B. Acc"unt t" /rm "! bene/t $eri;e$ !r"m transacti"n aDectin% partnership4 Apartner must acc"unt t" the /rm !"r any bene/t $eri;e$ !r"m a transacti"n aDectin%the partnership

Illustrati"ns

5a6 A, ? an$ C are partners in tra$e C, 0ith"ut the 7n"0le$%e "! A an$ ?, "btains!"r his "0n s"le bene/t a lease "! the h"use in 0hich the partnership business is

carrie$ "n A an$ ? are entitle$ t" participate i! they please, in the bene/t "! thelease

5b6 A, ? an$ C carryin% "n business t"%ether in partnership as merchants tra$in%bet0een ?"mbay an$ *"n$"n &, a merchant in *"n$"n, t" 0h"m they ma7e theirc"nsi%nments, secretly all"0s C a share "! the c"mmissi"n 0hich he recei;es up"nsuch c"nsi%nments, in c"nsi$erati"n "! C>s usin% his in uence t" "btain thec"nsi%nments !"r him C is liable t" acc"unt t" the /rm !"r the m"ney s" recei;e$by him

2B9 bli%ati"ns, t" /rm, "! partner carryin% "n c"mpetin% business4 I! a partner,0ith"ut the 7n"0le$%e an$ c"nsent "! the "ther partners carries "n any businessc"mpetin% "r inter!erin% 0ith that "! the /rm, he must acc"unt t" the /rm !"r allpr"/ts ma$e in such business, an$ must ma7e c"mpensati"n t" the /rm !"r any l"ss"ccasi"ne$ thereby



28@ Re;"cati"n "! c"ntinuin% %uarantee by chan%e in /rm4 A c"ntinuin% %uarantee,%i;en either t" a /rm "r t" a thir$ pers"n, in respect "! the transacti"ns "! a /rm, is,in the absence "! a%reement t" the c"ntrary, re;"7e$ as t" !uture transacti"ns byany chan%e in the c"nstituti"n "! the /rm t" 0hich, "r in respect "! the transacti"ns"! 0hich, such %uarantee 0as %i;en

281 N"n-liability "! $ecease$ partner>s estate !"r subse uent "bli%ati"n4 The estate"! a partner 0h" has $ie$ is n"t, in the absence "! an e press a%reement, liable inrespect "! any "bli%ati"n incurre$ by the /rm a!ter his $eath

282 Payment "! partnership $ebts an$ "! separate $ebts4 here there are "int$ebts $ue !r"m the partnership, an$ als" separate $ebts $ue !r"m any partner, thepartnership pr"perty must be applie$ in the /rst instance in payment "! the $ebts "! the /rm, an$, i! there is any surplus, then the share "! each partner must be applie$

in payment "! his separate $ebts "r pai$ t" him The separate pr"perty $ebts, an$the surplus 5i! any6 in the payment "! the $ebts "! the /rm

283 C"ntinuance "! partners> ri%hts an$ "bli%ati"ns a!ter $iss"luti"n4 A!ter a$iss"luti"n "! partnership, the ri%hts an$ "bli%ati"ns "! the partners c"ntinue in allthin%s necessary !"r 0in$in% up the business "! the partnership

28= N"tice "! $iss"luti"n4 Pers"ns $ealin% 0ith a /rm 0ill n"t be aDecte$ by a$iss"luti"n "! 0hich n" public n"tice has been %i;en, unless they themsel;es ha$n"tice "! such $iss"luti"n

28B in$in% up by C"urt "n $iss"luti"n "r a!ter terminati"n4 here a partner isentitle$ t" claim a $iss"luti"n "! partnership, "r 0here a partnership has terminate$,the C"urt may, in the absence "! any c"ntract t" the c"ntrary, 0in$ up the business"! the partnership, pr";i$e !"r the payment "! its $ebts an$ $istribute the surplusacc"r$in% t" the shares "! the partners respecti;ely

288 *imite$ liability partnerships, inc"rp"rate$ partnerships an$ "int-st"c7c"mpanies4 E tra"r$inary partnerships, such as partnerships 0ith limite$ liability,inc"rp"rate$ partnerships an$ "int st"c7 c"mpanies, shall be re%ulate$ by the la0!"r the time bein% in !"rce relatin% theret"

partnersip act

Documents