DISSOLUTION OF

PARTNERSHIP
MODES AND CONSEQUENCES

Radhika Aggarwal 20158

INTRODUCTION

• Partnership is the relation between persons who have agreed to share the profits of a business
carried on by all or any of them acting for all.

I. Existence of an agreement between the persons who want to be partners.

II. The purpose of the partnership should be carrying on of business.

III. The motive for the creation of partnership should be earning and sharing profits.

IV. The business of the firm should be carried on by all of them or any of them acting for all, i.e., in
mutual agency
TYPES OF PARTNERS

• Working partner
• Sleeping partner
• Nominal partner
• Partner by estoppel
• Secret partner
• Partner by holding out
TYPES OF PARTNERSHIP

• Partnership at will
• Particular partnership
• Partnership for a fixed time period
• General partnership
MODES OF DISSOLUTION

• Death of a partner.

• Retirement of a partner.

• Bankruptcy of a partner.

• Expiry of the partnership period.

• Expulsion of a partner
CONSEQUENCES

• Liability for acts done before retirement.

• Liability for acts done after retirement.

• Liability of an expelled partner.

• Liability after insolvency

• Revocation of continuing guarantee.

• Rights of an outgoing partner-

i. Right to carry on competing business.

ii. Restriction on competing business.

iii. Right to share subsequent profits.