Partnership and Business Law

Option (1) is incorrect: Z cannot sue A, B, C and X jointly. Option (2) is incorrect: Z can sue either A, B and C or A, B and X. Option (3) is correct:  Every partner is liable jointly with all the other partners and also severally, for all acts of the firm done, while he is a partner. Z can sue either A, B and C or A, B and X. Option (4) is incorrect: Z cannot sue A and B only.

Option (1) is correct: A public notice is not required in case of insolvency and death of a partner.

Option (1) is incorrect: Under Section 44 of the Partnership Act, either a partner or a court itself can ask for dissolution of firm in case of misconduct by a partner. Option (2) is incorrect: Under Section 44 of the Partnership Act, either a partner or a court itself can ask for dissolution of firm in case of insanity of partner. Option (3) is correct: The completion of venture is a contingent event, which results in dissolution of a firm. All other options are the cases when a court orders for dissolution of firm. Option (4) is incorrect: Under Section 44 of the Partnership Act, either a partner or a court itself can ask for dissolution of firm, in case of persistent breach of agreement by a partner.

Option (4) is correct: The reconstitution of a firm does not take place when there is a change in the profit sharing ratio.

Option (1) is incorrect: The dissolution of partnership between all the partners of a firm is called the dissolution of a firm. Option (2) is correct: A change in relations between the partners is called dissolution of partnership.

Option (1) is incorrect: In the absence of any usage or custom of trade to the contrary, a partner has implied authority to buy or sell goods on account. Option (2) is incorrect: In the absence of any usage or custom of trade to the contrary, a partner has implied authority to borrow money for the purposes of the firm. Option (3) is correct: Under Section 19(2) of the Act, the implied authority of a partner does not empower him to enter into partnership on behalf of the firm. Option (4) is incorrect: In the absence of any usage or custom of trade to the contrary, a partner has implied authority to engage a lawyer to defend actions against the firm.

Option (1) is correct: An outgoing partner does not have a right to use the name of the firm. The other rights are available to him unless there is a contract to contrary.

Option (4) is correct: All the options are correct and this is on partners will on how to proceed. There is no such law that D being C’s father, who has murdered B, can join the firm. It completely depends on existing partner’s (A) will.

Option (1) is correct: Since the existence of a sleeping partner is not known to the outside world, so it is not necessary for to give a public notice of his retirement. In all the other cases, a public notice is required.

Under the Indian Partnership Act, when persons enter into a partnership, they are collectively called a 'firm'. A 'partner' refers to an individual member, while 'firm' refers to all members collectively.

The general duties of partners include both carrying on business to the greatest common advantage and being just and faithful to each other. These are complementary obligations under Section 9.

Section 4 of the Indian Partnership Act defines partnership as the relation between persons who have agreed to share the profits of a business carried on by all or any of them acting for all. This is the foundational definition.

The object of the agreement is unlawful so where a businessman enters into an agreement with a Chartered Accountant to pay him fees and commission for the tax saved by so arranging the accounts as to conceal the true income of the business. Any dispute between the businessman and the Chartered Accountant on the fee and commission is to be settled by arbitration. The agreement is void. 

Preliminary decree can be passed in a suit of partition, partnership, for possession and mesne profits.