ASSIGNMENT NO.

28
INTRODUCTION
PARTNERSHIP DEED

If one needs to understand the partnership deed, before that he/she needs to know how does
the partnership deed come into existence. When two or more people want to start a new
business & to share the profits & losses they come together to form a partnership such written
agreement is known as ‘Partnership Deed’. One can also call it is a ‘Partnership Agreement’.
And when such business gets registered by its own name the same is called as a ‘Partnership
Firm’.
Partnership Deed is a written Partnership Agreement. It is basically made when two or more
people want to start a new business they come together under the mutual understanding with
the only purpose to do business & share profits & losses in the decided manner.
Key Points to Remember While Drafting Partnership Deed:
1.Number of members In a Partnership, there is a minimum requirement for two members.
Previously there was a limitation on the number of partners as follows:
a. Banking business-Less than or equal to ten
b. Non-Banking business- Less than or equal to twenty

If there are more partners than the given above then it becomes illegal to continue the
business of the partnership. 2. Minimum capital requirement: There's no limitation on the
requirement of capital at the beginning of the business. Partners can start of the business with
as much as minimum capital they want. The calculation of stamp duty also depends on the
amount of capital which has been put by partners. 3. The name should be different: While
deciding a name for the firm the care has been taken that it should not indicate any
undesirable intention, it should be simple & easy.
WHAT FACTORS ARE NEEDED TO FORM A PARTNERSHIP DEED?
A Partnership Deed is mainly formed on the basis of the following five factors which are
given as under:
1. A partnership deed is basically said to be a contract between the partners of the business.
Which binds all the partners in a legal relationship between the partners.
2. The minimum requirement for forming a partnership is of two members & there is a
limitation of ten in case of banking & twenty in case of non-banking business.
3. All partners should have a mutual understanding for doing a business.
4. The ratio for profits & losses should be decided among all the partners well in advance.
5. All partners should maintain the relationship as a principal-agent. Every partner is
answerable for the actions of other partners.
 PARTNERSHIP DEED

This DEED OF PARTNERSHIP is made at New Delhi on this 1st day of June, 2020.
BETWEEN
Mr. Rao Shivaji Kapoor R/o 555, Vasant Kunj, New Delhi-110070
And
Mr. Akhilesh Yadav s/o Mr. Mulayam Yadav, R/o 315, Sarita Viahr, New Delhi-110025,
hereinafter called the partners of the first part and Second Part respectively.

WHEREAS Mr. Rao Shivaji Kapoor the owner of a company named M/s Rao Paints
registered under the provisions of the Companies Act 1956 and having its registered office at
328, Jasola Vihar, New Delhi-110025.

WHEREAS the Party of First Part due to his illness is unable to run the business on his own
and by virtue of this partnership deed dated 1st June 2020 (first june two thousand twenty)
the Parties of First and Second Part mutually agree to carry on the business of manufacturing
and marketing paints, colors and varnishes etc. under the name and style of M/s Surya Paints.

NOW THIS DEED WINTESSETH AS UNDER: -

1. The Partnership shall come into effect from the date of execution of this deed and shall be
for an indefinite period unless it is determined.
2. That the name and style of the Partnership shall remain same.
3. That the business of the Partnership Firm hereby formed shall be that of manufacturing and
marketing of paints, colors and varnishes etc., as hereto before.
4. The parties may, however, with their mutual consent embark upon a new line or lines of
business and may open branch or branches or new factory.
5. That further finance required for the purpose of business of the firm shall be contributed by
the parties in such rate as may be mutually agreed upon. Interest at the rate of 10% or at a rate
as may be mutually agreed upon between the parties from time to time shall be allowed on
the capital standing to his/her credit for the time being in the books of the partnership.

6. That the final Profits & Losses shall be divided between and borne by parties hereto in the
following proportions: 50% of share in Profits and Losses by each of the partner.
7. That the partners will be paid a Salary of Rs.50,000/- per month (Rupees fifty thousand)
for the services rendered to the rim and they will also be entitled to a bonus @ 12% on their
salary.

8. That each partner shall: -

(a) Diligently attend to the business of the Partnership and devote his necessary time and
attention thereto.
(b) Punctually pay his separate debts and indemnify the other partner and the Assets of the
firm against the same and all expenses therefore.
(c) Upon every reasonable request inform the other Partner of all letters, accounts, writings
and such other things which shall come to her/his hands or knowledge concerning the
business of the Partnership.

9. That neither Partner shall without the consent of the others: -

a) Lend any of the money or deliver upon credit any of the goods of the firm to any person or
persons whom the other Partners shall have previously in writing forbidden her/him to trust.
(b) Raise or advance any loan in the name of or on behalf of the firm.
(c) Assign, charge or transfer her/his shares in assets or profits of the firm.

10. That it will always remain open to the parties hereto to amend, annul or change any term
or terms of this Deed of Partnership in the course of its business and in that event of
amending, annulling or changing any term or terms of this deed of Partnership no fresh deed
shall be required to be executed.
11. That without prejudice to the above terms and conditions the parties hereto in all other
matters shall be governed by the provisions of Indian Partnership Act, 1932.
12. That all the disputes or differences arising out of it and connected with the Partnership
shall be referred to the arbitrator in accordance with the Indian Arbitration Act.
 IN WITNESS WHRE OF, the parties of the first and Second parts here have put their
respective hands on this DEED OF PARTNERSHIP on the day, month and year first
mentioned above.

1. MR. RAO SHIVAJI KAPOOR

(PARTY TO FIRST PART)

2. MR. AKHILESH YADAV

(PARTY TO SECOND PART)

WITNESSES:

(1) AMANULLAH KHAN

S/O SAMIULLAH KHAN
R/O 123, SUKHDEV VIHAR,
NEW DELHI-110025

(2) ARUN KUMAR SINGHANIA

S/O VASUDEV SINGHANIA
R/O 421, JASOLA VIHAR,
NEW DELHI-110025.