Multiple choice

Each partner is a principal as well as an agent of other partners.

  1. The above statement is correct.

  2. The above statement is not correct in case of unregistered partnerships.

  3. The above statement is incorrect.

  4. The above statement is correct only in case of registered partnerships.
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A Correct answer
Explanation

In partnership law, each partner acts as both an agent (can bind the firm through actions) and a principal (can be bound by other partners' actions). This dual relationship is fundamental to partnership and applies regardless of registration status. The statement correctly captures this essential characteristic of partnerships.

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