Becoming partner

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

31 March 2015 Suppose....
Is possible. ...
In partnership firm to become partner without contribute capital in any kind...but get equal profit sharing ratio

CS,CA F,Numrologi TusharSampat

CS,CA F,Numrologi TusharSampat (Expert)
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31 March 2015 mostly it is will not accepted by existing partners.

Querist : Anonymous

Querist : Anonymous (Querist)

31 March 2015 If they agree ..Is possible

CMA. CS. Sanjay Gupta

CMA. CS. Sanjay Gupta (Expert)
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01 April 2015 If agreed by all partners and contained in partnership deed then only its possible as there is no provision restricting the same.

CS ( Dr.) Rajeev Babel

CS ( Dr.) Rajeev Babel (Expert)
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01 April 2015 Reference is invited to the definition given in the Partnership Act, 1932. Para 1 of Section 4 of the said Act reads as under, " Partnership" is the relation between persons who have agreed to share the profits of a business carried on by all or any of them acting for all." If we analyse the said definition, the following characteristics stands out: (i) Association of two or more persons, (ii) Agreement, (iii) Business, (iv) Sharing of profit ( profit also includes the sharing of losses) and (v) Mutual Agency. So what ever, the terms and conditions are settled between the partners ( as mentioned in the Deed)the Partnership is governed by that Deed. The Act do not prescribe it mandatorily to contribute any capital. There may be partnership without introducing any capital. For example: Two person agreed to share the profits for teaching some students. In that business it may be possible, that none of them have contributed any capital ( in rupee terms). However, in practical terms there are some remote chances of running a business without the capital. It is also to be mention here that capital does not mean only the contribution in terms of money, it may be in the form of contributing Land, Building, Intellectual work etc etc. So in the question raised by you, the other person say Mr A ( who is contributing the capital in terms of money)may agree to have the partnership with the person say Mr B ( who is not contributing capital in money terms) when Mr A satisfies himself that the inclusion of Mr B in the partnership will be the value addition in the business on account of the some attributes associated with the name of Mr B ( the attributes may be like, a very resourceful person, a very renowned personality, having business ideas etc etc.

CS,CA F,Numrologi TusharSampat

CS,CA F,Numrologi TusharSampat (Expert)
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01 April 2015 Rajeev sir request you to also post your conclusion based on the said refrence you provided above.

CS ( Dr.) Rajeev Babel

CS ( Dr.) Rajeev Babel (Expert)
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01 April 2015 Dear Tishar ji, Greetings. To sum up, they may enter into the partnership. In the Deed, it may be mentioned so. Regards. Rajeev Babel.

CS,CA F,Numrologi TusharSampat

CS,CA F,Numrologi TusharSampat (Expert)
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01 April 2015 Very thankful to you sir for responding and conluding the same.

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