Partnership

                                       Partnership

 As per partnership ordinance of 1980, a partnership is a            relationship which subsists among persons caring on a
 business in common with the motive of making profit

Accordingly the following features are surfaced in a partnership

- The aim of making profits 

- Collective relationship 

-to act in unison (To act for a common aim )

Rules and regulation affective partnership 

 Unlike the case of sole trade with regard to partnerships there are 
 no few rules and regulations which are directly influencing them.

- Partnership ordinance 1890

- Fraud prevention ordinance 1840

- Limited partnership ordinance of 1907 (Not applicable to srilanka)

- Business names ordinance of 1918

- Other rules and regulation (case decision garner vs murrey)

 Fraud prevention ordinance of 1840

if in any partnership starting capital were to be rupees one thousand (rs  1,000/-)or more it has been emphasized that should be carried out on a written agreement . in this instance although it could be carried out without written agreement it would not be possible to any relief from court in the absence of a written agreement 

Commencement of a partnership

as partnership in a relationship between a few persons it could be started up in any of the following ways.

- By verbal agreement among partners 

- By coming into a written agreement

- By implying or by the behavior of partners 

partnership agreements 

a partnership agreements is a written or verbal agreement which takes into a consideration all the facts relating to carry on the partnership business. the agreement could be maintained either as a written agreement or verbal agreement. if the agreement were to be written agreement the following facts should be include in it.

By the fraud protection ordinance of 1840 if the starting capital of any partnership were to be more than rs 1,000/= it should be compulsory conducts on a written agreement 

- The names of the partners 

- The names of address of partners 

- The objectives of the partnership 

- The main business activities of the partnership 

- The duration of the partners 

- The principal place of business of the partnership 

- How the partners should contribute to the capital 

- Weather interest is getting accumulated to the capital or not

- Weather interest is due on drawing or not 

- Payment of interest on loans granted by the partners to the partnership 

- The steps to be taken when a new partner joins the partnership 

- The duties and rights of partners 

- Payments of salaries to the partners 

- Settlements of disputes 

- Method of dissolution of the partnership 

once signed in the presence of a notary by all partners,it become an agreement 

section 24 of partnership ordinance of 1890

In the following two main situation section 24 applies to a partnership 

- In the situation where the partnership is carried on with out an agreement 

- In the situation where there is a partnership agreement but existence when it is silence regarding certain facts (when it is not mentioned in a partnership or agreement 

contents of section 24 of the ordinance

- The partners should equally contribute towards the capital 

- The profit and loss should be equally distributed

- All the partners should participate in the activities of the partnership and they should not draw a salary of the same 

- If a partner besides his capital contribution were to give a loan to the partnership he should have right to get an interest of at least 5%

- The accounting books of the partnership could be checked by all the partners at any time 

 - That the partnership accounting books should be maintained and kept at the head office