Business Law - Registration and Dissolution of a Firm

Description

Chapter 3: The Indian Partnership Act, 1932

UNIT – 3: REGISTRATION AND DISSOLUTION OF A FIRM

After studying this unit, you would be able to understand -

1. Be aware of mode of getting a firm registered with the authorities.

2. Understand the effect of registration of a firm upon the rights of partners’ inter-se and the rights of the third parties.

3. Note the effect of non-registration on rights of partners and the third parties.

4. Learn the various circumstances when a firm is dissolved.

5. The consequences and the effects of the dissolution upon rights and liabilities of various parties.

SUMMARY

Registration of a firm is effected by the Registrar of Firms by recording in the Register of Firms an entry of the statement relating to registration furnished to him. The Act does not make registration of the firm compulsory, yet the effect of the rules relating to the consequences of non-registration is such as practically necessitates the registration of the firm at one time or other. Certain disabilities have been imposed on partners of an unregistered firm seeking to enforce certain claims in the Civil Courts. A firm which is not registered is not able to enforce its claim against third parties in the Civil Courts; and any partner who is not registered is not able to enforce his claim either against third parties or against the fellow partners. An unregistered partner may, however, sue for the dissolution of the firm or for accounts only if the firm is already dissolved.

Dissolution of a firm means the breaking up or extinction of the relationship which subsisted between all the partners of the firm under various circumstances contemplated by Act. A partnership can be dissolved only in accordance with the manner prescribed under the Act.

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