Partnership Firm Registration In India

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Partnership Firm Registration Process

It is very easy and simple to register a Partnership Firm Registration with the below mentioned steps.

Our experts will help you in understanding your business structure.

Step 1

Our experts will help you in picking up the right company name.

Step 2

Our experts will draft the partnership deed according to the requirements.

Step 3

What is a Partnership Firm?

A Partnership Firm is an organization that is formed with two or more persons to run a business and divide the profits thereof in an agreed ratio. Each member of a group is called a partner and collectively known as a partnership firm. The Partnership firms are governed by an Indian Partnership Act, 1932. The firm is easy to form and the compliance is minimal as compared to companies. Incorporation of Partnership in India are governed by the Indian Partnership Act, 1932 and as per the act a partnership deed may be registered or unregistered.

Benefits of Partnership Firm :

There are many benefits that can be taken into account for starting or running a partnership business. The given list shows some advantages of a partnership firm:-

Less compliance -

In terms of compliance, the requirements are very less which makes it popular among people. In Partnership Firms, it is not essential to file any annual returns, and the financial statements of a partnership firm would not be made publicly available. At the same time, the accounts of a registered partnership firm are not required to be audited.

Easy to start -

Generally a partnership can be started with an unregistered deed of the partnership within 2-4 business days. Furthermore, having registered for the same has its own perks. The main benefit of having a registered firm will allow you to book lawsuits in courtrooms against other business associates or the business in the firm for the administration of rights addressed in the Partnership Act.

Budget-friendly -

In comparison to LLP, a general partnership is much more reliable to start. Even for the long term purposes, it is still inexpensive as the compliance requirements are very minimal. It doesn’t require an auditor.

Documents Required to register a Partnership Firm :

There are a number of documents that are required for the registration of the Partnership deed.

Here is the list of documents:-
Form No. 1 - Application for registration under Partnership Act
Affidavit mentioning intention to become a partner
Lease or rental agreement of the property/building where the business is set up
Address proof of the partners which includes PAN card, Aadhar card, Voter ID, driving licence.

Partnership Registration Process:

The registration of partnership deed can be done orally or in written format. However, an oral agreement is of no use when the firm has to deal with tax. Some necessary characteristic of a partnership deed is:-

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Frequently Asked Questions

A. An application form with fees needs to be submitted to the Registrar of Firms of the State in which the firm is situated. The application is required to be signed by all the partners or by their agents.

A. The registration of a Partnership Firm in India can normally take 12 to 14 working days. Moreover, the time required to issue a certificate of incorporation may vary as per the regulations of the concerned state. It is also subject to Government processing time which varies from state to state.

A. The scope of liability is not much as every partner is jointly liable with  all of the other partners and also individually, for  all the activities of the firm, during the course of the business while he/she is a partner. It means if a loss or injury happens to any third party or a penalty is levied during the course of a business then all partners will be held liable even if the loss or injury was caused by one of the partners.

A. In case if the partners of a firm want to end the partnership they can do by dissolving the partnership through notice, if it is a partnership of will. The partnership can be dissolved by following the terms laid out in the partnership deed.

A. If the partnership agreement is not registered or the objective of the business is illegal, then court may deem the partnership is invalid and dissolve the partnership.

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