Multiple choice

Under section 10, every partner has a duty to indemnify the firm for any loss caused to the firm by his _____ in the conduct of the business of firm.

  1. negligence

  2. wrongful act

  3. fraud

  4. All of the above
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

Section 10 of the Indian Partnership Act, 1932 specifically provides that every partner must indemnify the firm for any loss caused by their fraud in conducting business. The section is limited to fraud and does not extend to negligence or wrongful acts generally. The narrow scope is intentional to protect firms from willful misconduct while allowing for ordinary business risks taken in good faith.

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