Partnership Firm Deed

  Partnership Firm Registration in India Although registering a partnership firm is optional under the Indian Partnership Act, 1932, it is highly recommended as it provides legal recognition and helps avoid disputes. The registration process involves: Choosing a Unique Name for the Firm Drafting the Partnership Deed Filing the Registration Application with the Registrar of Firms Paying the Required Fees Receiving the Certificate of Registration

  Key Elements of a Partnership Deed: Name and Address of the Firm and Partners Nature of Business Capital Contribution by Each Partner Profit and Loss Sharing Ratio Roles and Responsibilities of Partners Duration of Partnership Dispute Resolution Mechanism Dissolution Procedure

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 how to draft the following clause in a partnership deed 12. Dissolution of the Partnership Firm Defines how the firm will be  closed  if partners decide to  dissolve  it. 💡  Example Clause: "The partnership shall be dissolved upon mutual agreement of all partners, and the assets and liabilities shall be settled accordingly." 📌  Tip:  Also mention  how assets will be divided  in case of dissolution.

 how to draft the following clause in a partnership deed 10. Dispute Resolution This clause explains how disputes between partners will be resolved. 💡  Example Clause: "In case of any dispute, the partners shall first attempt to resolve it  mutually . If unresolved, the dispute shall be referred to  arbitration  under the Arbitration and Conciliation Act, 1996." 📌  Tip:  Arbitration helps in  quick resolution  without going to court.

 how to draft the following clause in a partnership deed 9. Expulsion of a Partner Defines the grounds on which a  partner can be removed  from the firm. 💡  Example Clause: "A partner can be expelled for misconduct, fraud, or repeated violation of partnership terms, with the consent of  all other partners ." 📌  Tip:  Expulsion should be done  in good faith  to be legally valid.

 how to draft the following clause in a partnership deed 8. Retirement or Resignation of a Partner This clause sets the rules for  when and how  a partner can exit the firm. 💡  Example Clause: "A partner may retire by giving  three months' written notice  to all partners." 📌  Tip:  Mention  how the retiring partner’s capital will be settled .

 how to draft the following clause in a partnership deed 7. Admission of a New Partner Defines the  process for adding new partners  in the future. 💡  Example Clause: "A new partner may be admitted only with the  unanimous consent  of all existing partners." 📌  Tip:  Mention the  capital contribution and profit-sharing  terms for new partners.

 fees for registration

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  How to Register a Partnership Firm in Rajasthan? To register a partnership firm in Rajasthan, follow these steps: Prepare a Partnership Deed  – Draft a legally sound document specifying firm details, capital, profit-sharing ratio, and rights & duties of partners. Fill Application Form  – Submit Form 1 to the  Registrar of Firms, Rajasthan , along with required documents. Pay Government Fees  – A nominal registration fee is required. Verification and Approval  – The registrar verifies the documents and issues a  Certificate of Registration .

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  10.  Suitability Partnership Firm : Best for small businesses and family-run enterprises. LLP : Suitable for professional services, small to medium-sized businesses, and startups that do not require heavy investment. Private Limited Company : Ideal for startups and businesses looking for scalability, external funding, and strong legal protection.

  9.  Ease of Raising Funds Partnership Firm : Difficult to raise capital as it relies on partner contributions and loans. LLP : Easier than a partnership firm, but cannot raise equity from the public. Private Limited Company : Easiest among the three; can raise equity from investors, venture capitalists, and banks.

  8.  Continuity and Perpetual Existence Partnership Firm : Dissolves upon the death or insolvency of a partner (unless specified in the deed). LLP : Has  perpetual succession , meaning it continues to exist regardless of partner changes. Private Limited Company : Has  perpetual succession  and continues even if shareholders change.

  7.  Compliance Requirements Entity Type Compliance Level Partnership Firm Low LLP Moderate Private Limited Company High Partnership Firm : Requires minimal compliance; needs to file income tax returns. LLP : Needs to file annual returns and statements of accounts with MCA. Private Limited Company : Requires compliance with the Companies Act, including annual returns, financial statements, board meetings, and statutory audits.

  6.  Taxation Partnership Firm : Taxed at a  flat rate of 30%  + cess & surcharge. LLP : Taxed at a  flat rate of 30%  + cess & surcharge. Private Limited Company : Taxed at  22% (for domestic companies opting for lower tax rate under Section 115BAA) or 25% (if turnover exceeds Rs. 400 crores) .

  2.  Governing Law Partnership Firm : Governed by the  Indian Partnership Act, 1932 . LLP : Governed by the  Limited Liability Partnership Act, 2008 . Private Limited Company : Governed by the  Companies Act, 2013 .

 registration with registrar of firms

 partnership deed draft