Partnership Deed
This Deed of Partnership is made and entered into at____, this ____day of _______, 20__, amongst 1] Mr/Mrs/Miss_____________________, age___ years, Indian Inhabitant of _______________________________, (hereinafter referred to as the ‘Partner of First Part” for the sake of brevity); 2] Mr/Mrs/Miss_______________, age_____ years, Indian inhabitant of___________________________(hereinafter referred to as the ‘Partner of Second Part’ for the sake of brevity) and 3] Mr/Mrs/Miss______________________, age______ years, Indian Inhabitant of __________________________(hereinafter referred to as the ‘Partner of Third Part’ for the sake of brevity);
Whereas, the Partners hereto desire to carry on the business of___________ at________ and at such other places as mutually agreed by and between them, on the terms and conditions as set out herein below;
Now It Is Hereby Agreed By and Between The Partners As Follows:-
(1) The partners hereto hereby agree to carry on the business of ___________, in partnership under the name and style of M/s.______________.
(2) The said partnership shall commence on ____________and shall continue for a period of_____________ years. After the expiry of the said period all the partners hereto shall be entitled to extend the term of partnership for such period and such further periods as may be mutually agreed upon and for such proposed extension/s a written consent of all the partners hereto shall be treated as sufficient. However, in the event of such extension, a due notice thereof shall be given to the Registrar of Partnership Firms, ___________(Name of the State). Moreover, any proposed extension of term shall be subject to the terms and conditions set out herein.
(3) The business of partnership (hereinafter referred to as the ‘Said firm’) shall be ______________ and such other ancillary and complementary business as may be agreed to by and between them in future.
(4) The place of business of the ‘Said Firm’ shall be at___________________. Furthermore, the partners hereto may by mutual consent set up offices/branches at other places.
(5) The ‘Partner of First Part’ and the ‘Partner of Second Part’ hereby agree to contribute to the ‘Said Firm’ the immovable properties as are described in the Schedule appended hereto and for the purposes of capital contribution the said property is valued at Rs__________/- & Rs__________/- respectively and these sums shall be shown in their respective accounts as capital contribution on the credit side. Besides, the Partners of First, Second and Third Part have agreed to contribute the following amounts towards their respective shares in the initial capital of the ‘Said Firm’, which sums shall be proportionate to their respective shares in the profit & loss from the business of the ‘Said Firm’.
| (a) | Partner of First Part | Rs_______/- |
| (b) | Partner of Second Part | Rs_______/- |
| (c) | Partner of Third Part | Rs______/- |
| Total | Rs______/- |
Besides, the Partners hereto hereby agree to contribute such further sums towards the Partnership Capital, as may be required from time to time.
(6) The net profit & loss of the ‘Said Firm’ shall be apportioned amongst the partners as set out herein below:-
| (a) | Partner of First Part | ___% |
| (b) | Partner of Second Part | ___% |
| (c) | Partner of Third Part | ___% |
The net profit means the remainder of the amount left after deducting from the Gross Profits of the concerned year, the varied expenses incurred for the management of the partnership business, such as the rent paid for the place of business, salaries and wages paid to the employees and workers, commissions/s paid to the agents and brokers as well as all other expenses of business which are eligible for deduction under the Income-Tax Act.
(7) The accounting year of the ‘Said Firm’ shall be from the 1st day of April to 31st Day of March.
(8) At the end of the accounting year, the accounts concerning the business carried on by the ‘Said Firm’ in the preceding year shall be finalised in the form of Profit & Loss A/c and Balance Sheet, wherein the assets and liabilities of the ‘Said Firm’ and receipts and outgoings shall be elaborately described and the said accounts shall be signed by all the partners. Moreover, if found expedient of if any statute so mandates, the accounts shall be audited through a Chartered Accountant.
(9) Partner of the First part shall act as the Managing or Working Partner and discharge all the duties concerning the day-to-day business of the ‘Said Firm’. However, all the policy decisions, as mentioned herein below, shall be taken with the concurrence of the remaining partners. For performing these duties, the Managing Partner shall be paid a salary/emoluments of the sum not exceeding Rs._____/- per month.
(10) The Managing Partner shall have the right—
(a) To sign on behalf of the ‘Said Firm’, all such documents, papers and instruments concerning its affairs as are assented to by the remaining partners.
(b) To represent the ‘Said Firm’ in any transaction with the third Party.
(c) To represent the ‘Said Firm’ in all court matters and to sign all court documents, deeds and other instruments and further to appoint advocates and/or attorneys and in general to do all such acts, deeds and things as are required to give effect to the before mentioned things.
(d) To purchase and sell all such goods, articles and things as are required for the orderly conduct of partnership business.
(11) The ‘Partner of third Part’ has agreed to act as a dormant partner and he/she shall not be required to look after the day-to-day business of the ‘Said Firm’ and such partner shall not interfere with the ordinary affairs of the ‘Said Firm’. However, ‘Partner of Second Part’ besides the ‘Partner of First Part’ shall have the right to look into the day-to-do business of the ‘Said Firm’.
(12) The books of account and Balance-Sheet of the ‘Said Firm’ shall be maintained in the manner which is generally in vogue for the same or similar type of business. The said books shall be kept at the main place of partnership business or at such other place/places as are mutually agreed to by all partners. Moreover, each partner shall have also the right to inspect the books of accounts and to obtain a copy or extract thereof at his/her own expense.
(13) During the currency partnership business, after the closure of each accounting year Balance-sheet of the ‘Said Firm’ shall be drawn and valuation of its assets and liabilities made as early as possible.
(14) Each Partner shall—
(a) save and except the holidays, devote his/her entire time and attention to the partnership business.
(b) pay regularly his/her individual debts and perform all individual duties and keep indemnified other partners and the partnership assets from the liabilities thereof as well as the litigation of every kind arising therefrom including all the expenses, claims and demands involved therein.
(c) always be devoted and truthful to the other Partners in the matters concerning the business of the ‘Said Firm’ and shall always give them true accounts concerning its affairs.
(15) Without consent of other partners, no partner shall.—
(a) participate directly or indirectly in any other similar business or trade;
(b) appoint any employee, enter into agreement with him or remove any existing employee;
(c) sacrifice or forego any debt or sum or part thereof payable to the Partnership Firm;
(d) save and except the ordinary business transactions, lend, mortgage, sell or otherwise dispose off any part of the partnership property;
(e) transfer his/her share in the partnership business to any third party or create a charge thereon.
(f) stand surety or bailor for any party whatsoever or deliberately do any such act, which could endanger the property of the ‘Said Firm’ and
(g) draw, accept or negotiate any bill of exchange or promissory note on the account of the ‘Said Firm’.
(16) During the term of_____ years, no partner shall have the right to dissolve the partnership; However, if any partner desires to retire from the partnership business, he can do so by giving_____ months’ advance notice to other partners.
(17) The partnership shall not terminate on the death of any partner. Nevertheless, the legal heir or representative of any deceased partner shall be admitted to the partnership in the place of the deceased partner.
(18) The rights, powers, duties and liabilities of the partners hereto shall be governed by the Indian Partnership Act, 1932, the Rules made thereunder or any other Act or Regulation for the time being in force.
(19) At the end of______ years’ period, the partnership shall stand dissolved, However, if the partners decide to extend the partnership for such further period as may be decided by them, the partnership shall be deemed to have continued until the end of such further period. If any partner is not interested in remaining as a partner, he shall be deemed to have retired from the partnership at the end of its stipulated period and in such event the consequences shall follow as if he had retired during the subsistence of the partnership. The partnership shall not terminate due to insolvency or death of any partner.
(20) On the dissolution of the partnership an account shall be prepared setting out the loss and assets & liabilities of the ‘Said Firm’. After the individual share of each partner is determined, the same shall be defrayed from the sale of partnership properties or any part thereof.
(21) If any dispute arises amongst the partners hereto concerning the interpretation of the Partnership Deed or regarding the distribution/apportionment of profit and loss or any other like matter, the same shall be referred to the Arbitral Tribunal of a sole Arbitrator or if the partners do not concur in such appointment, to the Arbitral Tribunal of two or more arbitrators, one arbitrator to be appointed by each disputing partner and the said Arbitration proceedings shall be governed by the Arbitration Act for the time being in force.
(22) The partners hereto shall as expeditiously as possible register the said Partnership Firm under the provisions of Indian Partnership Act, 1932 and shall also register the ‘Said Firm’ under the Income-Tax Act, 1961 or shall give an intimation thereof to the concerned Authorities.
And Now the Partners above named do hereby set and subscribe their respective hands to this writing on the day and year mentioned herein above.
Mr/Mrs/Miss____________
Partner of First Part in the
presence of
Witness:-
Sd/-
(Partner of First Part)
Mr/Mrs/Miss____________
Partner of Second Part in the
presence of
Witness
Sd/-
(Partner of Second Part)
Mr/Mrs/Miss_____________
Partner of Third Part in the
presence of
Witness:-
Sd/-
(Partner of Third Part)
SCHEDULE
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