Question

Explain the types of a partnership firm?

Answer 1

Introduction: -On the basis of duration the nature of the partnership, it can be divided into the following types.

1. Partnership at will and particular partnership: -When there is no provision in the partnership agreement for the duration of the partnership is called 'Partnership at will'. A partnership may be dissolved by any partner by giving notice in writing to all partners of his intention (aim).

Some partnership firms formed for some specific object or for a particular period the partnership is called a "particular partnership". Such a partnership comes to an end on the completion of the venture or on the expiry of the period.

2. General and Limited Partnership: -In a partnership when the liability of partners is unlimited is called a general partnership. There are two types of partners, general partner, and the special partner. The general partner's liability is unlimited whereas special partner's liability is limited.

3. Registered and unregistered Partnership: -Initially it is not compulsory to get the partnership registered under the Indian Partnerships Act, 1932, except in Maharashtra State. In Maharashtra State registration of partnership, the firm is compulsory since April 1985. A partnership that works according to the partnership Act is called a Registered Partnership.

When a partnership is established for general purpose, it may not be registered then it is called an unregistered partnership.