The Dissolution Of A Partnership Firm By Agreement

If a partnership company is at its leisure, each of the partners of that company could dissolve it by sending a message to the other partners. In the communication, the partner must indicate in writing the reasons for the dissolution of the company. In this type of dissolution, the termination is effective from the date of issue if it does not have a predefined date of dissolution of the entire company and the company is therefore dissolved once after the date of receipt of the notification. As regards a partnership, there are two types of dissolution: technical (see paragraph 53.81) and general (see paragraph 53.82). The dissolution of a partnership company means the cessation of the activity under the name of this partnership company. In this case, all liabilities are settled definitively by selling assets or transferring them to a given partner, with the payment of all existing accounts with the partnership company. If a partner has been guilty of a fault, the other partners can persuade the court to dissolve the company. The misconduct of a partner gives a bad reputation to the company and damages the reputation of the company. The fault may be commercial or otherwise. If a partner is jailed for theft, it also impacts the company`s good reputation, although it has nothing to do with the business. 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 partnership between all the partners of a company is called the dissolution of a company.” It implies the total elimination of the partnership relationship between all partners.

The dissolution of the partnership is different from that of the company. The dissolution of a partnership company involves only a change in the partner`s relationship; while the dissolution of the business is equivalent to a complete closure of the business. If one of the partners dies, retires or becomes insolvent, but the remaining partners still agree to continue the activities of the partnership enterprise, it is the dissolution of the partnership and not the dissolution of the enterprise. The dissolution of the partnership changes the mutual relations between the partners. But in the event of dissolution of the company, all the relations and affairs of the company end. With the dissolution of the company, the activity of the company ceases to exist, because its business is terminated by the sale of assets and the payment of debts and the exemption of the debts of the partners. The dissolution of the partnership between all the partners of a company is called the dissolution of the company. The dissolution of a partnership may be done as follows: · Dissolution without intervention by the Court of Justice. · Dissolution by the court.

Dissolution without intervention of the Court:- 1. By agreement (s.40) A partnership company may be dissolved at any time with the agreement of all partners, whether the partnership is carried out at will or for a fixed period. A partnership may be dissolved in accordance with the terms of the partnership deed or the separate agreement. 2. Forced dissolution (§ 41): – If any of the following events occurs, it becomes mandatory for the company to dissolve: (i) insolvency of the partners If all the partners or all the partners except one become insolvent. (ii) Illegal operations In the event that the company operates more than one activity that is likely to be illegal, it would appear that the business will not dissolve internally, unless one of them is linked in such a way that the interruption of one business would paralyze the others, for example.B. A and B charter a vessel; to travel to foreign ports and receive cargo on the Joint Undertaking. .

This article was written by: SignEx