Partnership

“Partnership firm is a business entity created by persons who have agreed to share profit or loss of business. Partnership is a good choice of business entity for small enterprises wherein two or more persons decides to contribute to a business and share the profit or loss. In India, Partnership are widely prevalent because of its ease of formation and minimal regulatory compliance. Hence, Partnership are most prevalent type of business entity wherein a group of people are involved. In terms of the Indian Partnership Act, 1932, the only criterion to commence business as a Partnership is the finalisation and execution of a Partnership Deed between the Partners. There are no penalties for non-registration of Partnership firm, and a Partnership firm can even be registered after formation. However, unregistered Partnership firm have certain rights denied in Section 69 of the Partnership Act, which deals with the effect of non-registration of Partnership firm.