Conversion of proprietorship into partnership
MUHAMMED (Practising Cost Accountant) (34 Points)
03 June 2015MUHAMMED (Practising Cost Accountant) (34 Points)
03 June 2015
CA CMA CS Ram Pavan Kumar Melam
(CA)
(6980 Points)
Replied 05 June 2015
Can be done. Recitals of the deed may specify past business model of oral partnership. Terms of the deed wrt incurring liabilities does not hold a partner from incurring liabilities and on doing so the other partners as well liabile for the acts of such partner. The terms of the deed are a contract of behaviour / conduct among the partners and outsiders may not have notice of the terms of the contract and can approach not only on the partner who incurs such liability but on any partner / firm for the liabilities of the firm.