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Company Law on Partnership firm


harshit mehta   04 December 2020

harshit mehta

 4 likes  81 points

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If co.law 2013 does not apply on partners form of business so how come section 464(illegal association)
tells the limit of persons in partnership or association?
or does co law 2013 apply on partnership firms?
JATINDER KUMAR

JATINDER KUMAR (Accountant)     06 December 2020

JATINDER KUMAR
Accountant 
 263 likes  3647 points

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Company Law is not applicable on Partnership Firms but maximum partners limit is 50 in partnership firm
2 Like
Chirag

Chirag (Professional)     07 December 2020

Chirag
Professional 
 78 likes  951 points

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Here, Companies Act is not regulating Partnership form of business, while this section is just elaborating that if the No of Partners exceeds 50 or In any unicorparted AOP and If such AOP/Firm is carrying on or having it's object towards profit oriented activity then it's mandatory to register itself as company under this act, here, your query is also reasonable that how Companies act, can even provide no of partners, while Indian Partnership act, 1932 is not providing it, see only one reason being, Contemporena exposition can't be applied for act dated back in 1932 with no significant changes while Companies act is dynamic and according to modern need of Society, So, simply if there are more than 50 partners (Professional Firms are not in it), Then it's impossible all are actually involved in business, while they had infused capital and are sleeping one, If limit is not at there, Partnership firm which can easily escape itself with Deposit Regulations ,Investors Protection, Governance Requirments, No Reporting or filing any FS (Except IT/GST),can make 1000-2000 or even more person(s) as partner and then dupe crores, and such Regulatory authority RBI/SEBI/MCA can't do anything in it, that's why it seems there is a limit prescribed under companies act... Hope it helps.. thnx

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