Can firm pay commission based on net profit to non partner ?
This query is : Resolved
23 May 2016
Hello everyone,
M/S AB is a firm. Mr Z has good contacts and he can get business to the firm. But he don't want commission on transaction wise he want a specified % of net profit without being a partner.
Firm is planning to enter into MOU for the Same.
Is firm steps correct ????
M/S AB is a firm. Mr Z has good contacts and he can get business to the firm. But he don't want commission on transaction wise he want a specified % of net profit without being a partner.
Firm is planning to enter into MOU for the Same.
Is firm steps correct ????
23 May 2016
Sharing of profit to other than a partner of the firm under the nomenclature '% of net profit' is against Indian Partnership Act,1932.
23 May 2016
sharing the figure of profit with a non member/partner is not a prudent policy.
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