Registration of partnership
Partnership comes into existence by an agreement between two or more persons called partners. The Indian Partnership Act, 1932 makes provision for registration of firms but registration is not compulsory in India. As registration is not compulsory, unregistered firm is not treated as an illegal association. Registration of partnership arises because it safeguards the legitimate rights and obligations of parties in case of disputes and disagreements.
Registration of partnership firm in India is a simple process and it may be effected at any time by sending certain information by post or delivery to the Register of Firms of a locality.
A statement in prescribed form giving details about the firms duly signed by the partners with a nominal amount of Rs. 3 as registration fees is submitted to the register of firms. The statement submitted to the registrar of the firms contains the following information with regard to the firm:
- The name of the firm.
- The names and addresses of the partners of the firm along with their date of joining to the firm.
- The names of the places where the business of the firm is carried on.
- The principal place of business of the firm.
- The object of the partnership.
- The duration of the partnership.
The statement containing the above information must be signed and verified by all the partners or their agents authorized. On receipt of the signed statement and requisite fees the registrar enter all these particulars in its register and get the firm registered. Though registration of firm is not compulsory, yet it is desirable because it gives a reliable evidence of existence to the firm. Non-registration does not invalidate the transaction of the firm and there is no penalty for non-registration.