Where a Partnership Firm Is Constituted for a Fixed Period

f. Mandatory Electronic Identification Number for Designated Partners – In India, the Designated Partner Identification Number (DPIN) has recently been made mandatory. This number is allocated to existing and future partners. A person must have an NDP with only one number, even if they have several such partnerships. The classification of the company on the basis of liability takes into account the nature of the liability of the partners concerned, whether unlimited or limited. On the basis of liability, the partnership may be a general partnership or a limited partnership. Dissolution of companies When the relationship between all the partners of the company ends, it is called dissolution of the company. Section 39 of the Indian Partnership Act provides that «the dissolution of the company between all the partners of a company shall be called the dissolution of a company». This implies the complete rupture of the partnership relationship between all partners. The dissolution of the company is different from the dissolution of the company.

The dissolution of a partnership simply entails a change in the relationship between the partners; while the dissolution of the company is equivalent to a complete closure of the company. If one of the partners dies, retires or becomes insolvent, but the other partners still agree to continue the activities of the partnership, then this is the dissolution of the partnership and not the dissolution of the partnership. The dissolution of the company changes the mutual relations of the partners. But in the event of dissolution of the company, all relations and affairs of the company end. With the dissolution of the company, the commercial activity of the company ceases to exist, since its business is increased by the sale of assets and by the settlement of liabilities and the execution of shareholders` claims. The dissolution of the company between all the partners of a company is called the dissolution of the law firm. The dissolution of a partnership may take place as follows: · Dissolution without intervention of the Court. · Dissolution by the court. Dissolution without judicial intervention:- 1. By agreement (p.40) A partnership may be dissolved at any time with the consent of all the partners, whether the partnership takes place at will or for a certain period. A partnership may be terminated in accordance with the terms of the deed or separate agreement. 2.

Mandatory dissolution (§ 41): In the event that one of the following events occurs, it becomes mandatory for the Company to exclude: (i) Insolvency of the Partners In the event that all but one of the Partners become insolvent. — Illegal business In the event that the business operates more than one business that may have become illegal, the best idea seems to be that the business will not dissolve like other lawful transactions unless all of them are linked in such a way that the termination of one business would cripple others, e.B. A and B charter a vessel, go to a foreign port and receive cargo as part of the joint venture. War broke out between England and the country where the port was located before the ship arrived at the port and continued until after the scheduled time for loading. The partnership between A and B is dissolved 3. Dissolution upon the occurrence of a possible event (p.42) A company may be dissolved if one of the following conditional events occurs (i) Expiration of the measured period A company founded for a term is of course not exempt from dissolution for any of the other possible reasons before the end of the term. The contract may expressly provide that the partnership decides in certain circumstances, but even in the absence of such an express clause, an implied provision on when the partnership will determine may be drawn from the contract and the nature of the transaction. It is clear from the provision of this Article that, if the firm is constituted for a certain period, it shall be dissolved at the end of that period, unless there is evidence to the contrary between the partners. (ii) When performing a specific task, a partnership established for the performance of contracts with certain persons in a given season would be terminated after the conclusion of the contracts. In Basantlal Jalan v.

Chiranjilal, if the company was formed for a certain obligation to supply certain quantities of grain and the contract was terminated prematurely after the delivery of part of the goods, it was found that the company was not terminated and was dissolved only with the final sale of the assets. (iii) Death of the partner If the charter of the company did not provide that the death of a partner the company dissolved after the death of a partner. Fixed, is automatically dissolved upon the death of a partner. The continuation of the company after such a death would not be synonymous with the continuation of the previous partnership. (iv) Insolvency of the Partner In the absence of a contract to the contrary, the insolvency of one of the Partners may dissolve the Company. The rule also applies if the partnership has been established for a certain period of time and the term has not yet expired or has been established for a particular partnership and has not yet been concluded. (v) Withdrawal of the Partner The withdrawal of one of the Partners dissolves the Partnership on the 4th. Dissolution by termination (p.43) In the case of a company at will, a Partner may dissolve it by informing the other Partners duly signed by him in writing of the dissolution. The notification must be very clear and secure. A notice of termination once given cannot be withdrawn without the consent of other partners, was held in banarsidas v.

Kanshi Ram. In cases where a partner has announced the dissolution at a time when the dissolution gives him an advantage over the other partners, he may be held in the firm until the completion of the ongoing transactions. Dissolution by a court (S 44) The court may order the dissolution of the company for the following reasons: — (i) Insanity of the partner At the request of a partner, the court may order the dissolution of the company if a partner has acquired an unhealthy spirit. . . .