“PROJECT

REPORT ON
Kinds of Partnerships and Partners under The Indian
Partnership Act, 1932
IN PARTIAL FULFILLMENT FOR THE REQUIREMENTS OF THE COURSE
B.COM LL.B. (HONS.) IN THE SUBJECT
OF
BUSINESS LAWS-I

UNIVERSITY INSTITUTE OF LEGAL STUDIES,

PANJAB UNIVERSITY

SUBMITTED TO- SUBMITTED BY-

MS. PREETI BANSAL DINKAR JAIN
UILS,PU,CHD. 212/20
B.COM LL.B. SEC-D
SEMESTER - VII
 ACKNOWLEDGEMENT

I would like to express my special thanks of gratitude to my teacher Ms. Preeti Bansal who gave me the
golden opportunity to do this project on the topic “Kinds of Partnerships and Partners under The Indian
Partnership Act, 1932”. While doing research on this project, I came to know about a lot of things related
to this topic.
Finally, I would also like to thank my friends who helped me a lot in finalizing this project within the limited
time frame.

Dinkar Jain

B.COM LL.B.

Section-D

212/20
 Contents
Sr. No. Particulars Page No.
1 Introduction 1
2 Types of Partnerships- On the basis of duration 2-5
3 Types of Partnerships- On the basis of tenure 5
4 Types of Partnerships- On the basis of nature 5-6
5 Types of Partnerships- On the basis of registration 6
6 Kinds of partners 7-10
7 Conclusion 10
 Table of Cases
A
Abott v. Abott (1936) 3 All ER 823……………………………..………………………………..…….4
Arunachalam & Co. v. M. Sadasivam, AIR 1985 Mad. 354………........……………………………...2,3

Banarsi Das v. Seth Kanshiram, AIR 1963 SC 1165……………………………………………………3

Byrne v. Reid (1902) 2 Ch. 735…………………………………………………………...…………….8

D
Deoki Prasad v. Anar Dai Poddar, AIR 1999 Pat. 122………………………………………………….4
Dharam Vir v. Jagan Nath, AIR 1968 Punj. 84………………………………………………….……..12
K
Kangamal v. Theatre Abirami, Partnership Concern, 2009 (4) CTC 593…………………………..…..2

K. Jaggaiah v. Kokumanu AIR 1984 AP 149……………………………………………………..……5

K.T. Chettiar v. E.M.I. Muthappa AIR 1961 SC 1225…………………………………………...…….4

M
Mohribibi v. Dharmodas Ghose 1903 ILR 30 CAL 539………………………………...…………….11
M.O.H. Uduman v. M.O.H. Aslum, AIR 1991 SC 1020...……………………………...…………….2,3
Moss v. Elphick (1910) 1 KB 486………………………………………………………..……………..3

Mulchand v. Manekchand (1906) 8 Bom LR 8…………………………………………………………8

Munton v.Rutherford 12 Mich. 418……………………………………………………...……………..11

M/s. P.P.M. Sankaralinga Nadar Sons v. Dr. D Rajkumar 2009 (2) LW 404 (Mad.)……………….…10
P
Pigott v. Bagley, Mc Cl. & Y. 569……………………………….………………………………….….8
R
Rabindra Nath Dey v. Dilip Kumar Dey, AIR 2001 Cal. 172…………………….…….…………...…4
Ram Dass v. Mukut Dhari, AIR 1952 VP 1……………………………….……………………………5
Rashik Lal v. ITC, AIR 1998 SC 401……………………………………………….…….......………..1

Senaji Kapurchand v. Pannaji Devichand, AIR 1930 PC 300………………………….………………5

 Abstract:

The Indian Partnership Act of 1932 is a pivotal piece of legislation governing partnerships in India. This Act
defines and regulates the formation, operation, and dissolution of partnerships within the country. Under this
legal framework, partnerships can take various forms, and partners can assume different roles and
responsibilities. This project explores the different kinds of partnerships and partners as defined by the Indian
Partnership Act, 1932. The Act recognizes two types of partnerships, namely Partnership at will and Particular
Partnership. S. 7 which provides for partnership-at-will reads as follows: “Where no provision is made by
contract between the partners for the duration of their partnership or for the determination of their partnership,
the partnership is 'partnership at will'.” S. 7 which provides for particular partnership reads as follows
“particular partnership between partners whereby they engage in particular adventures or undertaking.”
Further, partners under the Indian Partnership Act, 1932, can assume various roles, each with distinct rights
and responsibilities. The Act recognizes Actual or Ostensible Partner, Dormant Partner or Sleeping Partner,
Nominal Partner, Sub-Partner, Working Partner, Partner only in Profits, Incoming Partner, Outgoing or
Retiring Partner, Partner by Estoppel or Partner by Holding Out, Minor Partner. Understanding the various
kinds of partnerships and the roles of partners is essential for entrepreneurs and investors seeking to engage in
business ventures within India. The Indian Partnership Act, 1932, not only provides the legal framework for
partnerships but also safeguards the interests of partners and promotes the smooth functioning of businesses
across the nation. It is imperative for those considering partnerships to carefully assess their roles,
responsibilities, and liabilities under this legislation to make informed and strategic decisions.

Keywords: Partnership, Partners, Partnership at will, Particular partnership, Indian Partnership Act, 1932
 Introduction

The term 'partner' is linked to various other words. The Latin word "partitionem," which meaning "portion or
division," is thought to be the source of the word. The French word "parcener," which meaning "joint heir" or
"one that shares or has a part with another," is likewise related to the English "partner." The word "to part"
can also imply "to divide" or "to share," which is another way to decompose it.

A partnership is a type of commercial organisation in which two or more people come together to run a
business together. This increases the potential for profit and innovation by enabling the pooling of resources
and the distribution of labour among the partners. Additionally, there is the assurance that the partners rather
than a single person will bear the obligation in the event of a loss. In terms of time and legalities, forming or
dissolving a partnership is far less complicated than, say, incorporating or winding up a corporation under the
corporation Act, 2013. The partnership agreements, which in large part regulate the parties' interactions and
the firm's operations, are freely created and modified by the parties. In a similar vein, daily management and
legal compliance are easier with this corporate structure than with others. S. According to Section 4 of the Act,
a "partnership" is a relationship between people who have agreed to split the profits from a firm that all of
them, or any one of them, act as agents for. Individually, those who have formed a partnership with one another
are referred to as partners; together, they are referred to as a "firm," and the name under which they conduct
business is referred to as the "firm name."

This definition of a partnership is broader than the one found in the Indian Contract Act of 1872 in that it
include the crucial component of "mutual agency," which was missing from the earlier definition. Partnership
is defined as "the relation existing between persons carrying on business in common with a view to profits" in
the English Partnership Act of 1890. Simply said, a partnership is a relationship between two persons who
decide to pool their resources, talents, or labour in a business in exchange for a share of the earnings. "A
compendious way of describing the individuals constituting the firm" is how one person has defined a firm.
After examining S. The following five characteristics of a partnership can be deduced from Section 4 of the
Act: a valid agreement, two or more people who wish to become partners, the purpose of carrying on a
business, the motivation of earning and sharing profits, and mutual agency, which requires that all partners
carry out the firm's business or that any partner act on behalf of all. In simple words, if two people agree to
combine money, skill or labour in a business and to share profits thereof, their relationship is called
partnership. A firm has been described as "a compendious way of describing the individuals constituting the
firm".1

1
Rashik Lal v. ITC, AIR 1998 SC 401
1|Page
 Kinds of Partnerships
S. 5 states that partnership is not created by status. It makes it clear that relation of partnership can arise out of
a contract only. Partnerships are considered to be a versatile organisation model as they allow for a lot of
freedom in operations as per the partnership agreements. These agreements cater for purpose, scope, operations
and determination of partnerships.

The different kinds of partnerships under the Act can be studied under the following heads-

1) On the basis of Duration

a) Partnership-at-will [S.7]
S. 7 which provides for partnership-at-will reads as follows: "Where no provision is made by contract
between the partners for the duration of their partnership or for the determination of their partnership, the
partnership is 'partnership at will'."2

Thus, a partnership is deemed to be a 'partnership-at-will if the partnership agreement makes no provision

for:
(a) its duration, or
(b) its determination (coming to and end of partnership).

Whether the partnership is at will or not depends on the contract between the partners. If the agreement does
not expressly indicate the nature of partnership, then an inference may be drawn from the terms of the
agreement. Hence, the provision regarding the duration of partnership or its determination, in the partnership
contract, may be either express or implied. It has to be seen whether the various terms of agreement are
consistent with a partnership at will or not. If the partnership agreement makes a provision for its duration, or
where a provision is made for its determination, it is not a partnership at will. But if the duration of partnership
has been fixed but the partnership is made to continue thereafter without specifying any fixed duration for the
same, then subsequently it becomes a partnership at will.3

If an agreement between the partners contemplates that the partnership would continue 'till there are two
partners', it is not a partnership at will.4 The Madras High Court has observed that S. 7 makes it clear that two
conditions must be satisfied for holding that a partnership is a partnership at will5:

(a) There should be no provision in the contract between the parties for the duration of the partnership; and

2
Section 7, The Indian Partnership Act, 1872
3
Arunachalam & Co. v. M. Sadasivam, AIR 1985 Mad. 354.
4
M.O.H. Uduman v. M.O.H. Aslum, AIR 1991 SC 1020.
5
Kangamal v. Theatre Abirami, Partnership Concern, 2009 (4) CTC 593
2|Page
(b) There should be no provision for the determination of the partnership.

Accordingly, the partners are not legally bound to continue in partnership for any specified period, the
partnership-at-will would stand dissolved on exercise of discretion of one partner. Now, S. 32(1)(c) of the Act
provides that in a partnership-at-will, a partner may retire by giving a notice to all the other partners of his
intention to retire. Further, as per S. 43, such a firm may be dissolved by any partner giving notice in writing
to all the other partners of his intention to dissolve the firm.6

Although a partnership at will could be dissolved by a mere notice but that does not debar a partner from filing
a suit for dissolution. In such a case, the service of the summons is deemed to be the communication of notice
for dissolution and the fir stands dissolved when the summons are served.7

When the partnership is not at will, neither a person can retire nor can he seek dissolution of the partnership
firm, J by giving a notice to the other partners to that effect. When a partnership is created for three years but
the business of the firm is continued thereafter also without specifying the duration of the extended term, then
during the extended time it becomes a partnership at will and the same can be dissolved by a notice.8

In Moss v. Elphick,9 an agreement between the two partners provided that the partnership shall be terminated
by mutual arrangement only. One of the partners sought the dissolution of the firm by a notice to the other
partner contending that it was a partnership at will. It was held that the partnership was not at will and the
same could not, therefore, be terminated by notice It was observed by Fletcher J. that in this case in effect the
partnership was "for the joint lives of the parties, unless terminated by mutual agreement. There is, therefore,
a specific provision as to the duration of the partnership in the partnership agreement, and it is in that sense a
partnership for a fixed, ie defined, term."

In M.O.H. Uduman v. M.O.H. Aslum,10 the partnership deed contained a clause to the effect that "the
partnership shall continue between the remaining partners unless all the partners 'mutually agree' to determine
the relationship". Considering this clause, the Apex Court held that the partnership was not 'at-will and that it
could not be dissolved by a partner by giving notice to the remaining partners. It is thus stated that full effect
has to be given to the intention of the parties to be gathered from the conjoint reading all the parts in the
partnership deed.

6
The firm is dissolved as from the date mentioned in the notice as to the date of dissolution or, if no date is so mentioned, as
from the date of the commission of the notice.
7
Banarsi Das v. Seth Kanshiram, AIR 1963 SC 1165; S.A. Pareira Vishnu Yeshwant, AIR 1981 Goa 57, Arunachalam & Co. v. M.
Sadasivam, AIR 1985 Mad. 354.
8
Arunachalam & Co. v. M. Sadasivam, AIR 1985 Mad. 354.
9
(1910) 1 KB 486
10
AIR 1994 SC 1020
3|Page
In Abott v. Abott,11 the partnership agreement between a father and his five sons inter alia provided that the
death or retirement of any partner shall not terminate the partnership, and if any partner shall do or suffer any
act which would be ground for the dissolution of the partnership by the court, then he shall be considered as
having retired. One of them contended that since no duration had been mentioned, it was a partnership at will
and sought the dissolution of the same through a notice. It was held that a single partner could not determine
the partnership by a notice, although he could retire or cease to be a partner allowing the partnership firm to
continue thereafter, and hence it was not a partnership at will and could not be dissolved by a notice by any
one partner.

The question of the construction of the contract also arose before the Supreme Court in K.T. Chettiar v.
E.M.I. Muthappa.12 Here, an agreement between two partners concerning the business of managing agencies
of mills, inter alia provided for carrying on the management in rotation once in four years by the two partners.
It also stated that the partners and their heirs and those getting their rights should carry on the management in
rotation. It was held by the Supreme Court that the intention of the partners could not be to create a partnership
at will, but to have a partnership of some duration, though the duration was not expressly fixed in the
agreement. If the partnership agreement contemplates that the partnership will continue till completion of the
job, i.e., completion of particular venture of a certain construction work it was held that the partnership was
not a partnership at will and it stood dissolved on the completion of the said venture.13

Determination of partnership
When there is a partnership of two partners, absence of one automatically gives room of determination of
partnership under S. 7 of the Act itself. This is the prime difference between partnership made by two partners
or made by more than two partners. Since the partnership of more than two partners cannot automatically
evaporate by virtue of absence of any one, such partnership will have to be treated as partnership-at-will in
absence of any condition of duration or determination.14

b) The Particular Partnership [S. 8]

According to S. 8, there can be 'particular partnership between partners whereby they engage in particular
adventures or undertaking. Thus, persons can be partners in the working out of a coal-mine or the production
of a film because although that may be a single adventure but the same requires a series of transactions and
continuous relationship. Similarly, if a number of bales of yarn are purchased at one time, but the sales are to

11
(1936) 3 All ER 823
12
AIR 1961 SC 1225
13
Deoki Prasad v. Anar Dai Poddar, AIR 1999 Pat. 122.
14
Rabindra Nath Dey v. Dilip Kumar Dey, AIR 2001 Cal. 172
4|Page
go on, profits are to be realized and then distributed amongst a number of persons, there is a carrying on of
business.15

The effect of distinction between a single transaction (also sometimes mentioned as single venture) and the
carrying on of the business has been stated as follows16: "A single venture or transaction finishes immediately
after the purchase and the sale. There is no continuity 'carrying on of the business', in the sense that one or or
more partners continue to have the responsibility and to apply their discretion, in buying, storing, selling and
keeping charge of the money over a length of period. If this length of period, and the scope of the business are
defined with reference to a particular season or to particular quantities of commodity, then we have a particular
partnership. If in the agreement itself the period and the scope are not precisely defined, then we may call it a
general partnership. Either way, it has to be a business, 'carried on' with repetitions of the process of purchasing
and selling, and keeping charge of the commodities and the moneys."

In K. Jaggaiah v. Kokumanu17, the plaintiff and the two defendants joined together and obtained a contract
for the maintenance of a road. There was held to be partnership in the road building activity. Such activity
though arising out of a single contract was spread over a particular period and the firm had to employ certain
workers, supervise the work, prepare the bills and finalise the work and get the approval from the Government
and finally receive the bills, and all that meant carrying on of business.

2) On the basis of Tenure

a) Partnership for a Fixed Term

In this kind of partnership, the collaboration is for a set amount of time, such as 5 years, 2 years, or any other
time period that is defined. After the aforementioned time period expires, the partnership terminates
automatically.

b) Flexible Partnership

Partnerships which are neither for a fixed duration of time nor for any particular venture are called flexible
partnerships.

3) On the basis of Nature

a) General Partnership

Each partner in a general partnership retains the authority to decide how the business will operate and be
managed. It is important to remember that under this kind of partnership, each partner is subject to infinite

15
Senaji Kapurchand v. Pannaji Devichand, AIR 1930 PC 300
16
Ram Dass v. Mukut Dhari, AIR 1952 VP 1
17
AIR 1984 AP 149
5|Page
liability. It means that if one partner makes a financial mistake or suffers a loss, all of the other partner's
assets will be considered in order to fulfil the responsibilities made in the form of debts.

In the absence of an agreement, general partnerships with limited liability are subject to the requirements of
the Indian Partnership Act, 1932.

b) Limited Liability Partnership (LLP)

Limited liability partnerships are corporate forms of company organisation, as opposed to ordinary
partnerships. Each partner's responsibilities in this kind of partnership are capped in proportion to their
involvement in the company. Additionally, the partner's assets or personal property cannot be seized to
satisfy the firm's debts. It is important to note that this organisation is governed by the Limited Liability
Partnership Act of 2008 rather than the Partnership Act of 1932.

In a limited liability partnership, all partners—aside from one—have limited responsibility to the amount of
their capital contributions. It is important to remember that limited liability cannot be granted to any partner
in a partnership.

4) On the basis of Registration

The registration of a firm is not mandatory under Partnership Act, 1932. Both Registered firm and unregistered
firm are valid in the eyes of Law.

a) Unregistered Partnership Firm

An unregistered firm is established when there is execution of agreement between the partners. The partnership
firm which is unregistered allows the partners to carry out business activities as provided in the agreement.

b) Registered Partnership Firm

In order to register a partnership firm, it must be registered with the Register of Firm (RoF) having the requisite
jurisdiction over the place where the Firm is carrying out its business activities. The application of registration
involves the payment of registration fee to RoF, which varies from state to state in accordance with the state
laws. In a partnership, registration of a firm is preferred due to benefits it offers such as filing a suit in the
court.

6|Page
 Kinds of Partners
Because the relation of partnership can arise only out of a contract, the people who are partners in a firm must
be competent to contract. If all partners are minors or if there is only one adult partner, it is not a partnership
at all. Any person who deals or intends to deal with a partnership must know who are the partners in the firm
and to what extent each partner is liable. There are different types of partners-some of which are expressly
mentioned and dealt with under the Act.
(1) Actual or Ostensible Partner
(2) Dormant Partner or Sleeping Partner
(3) Nominal Partner
(4) Sub-Partner
(5) Working Partner
(6) Partner only in Profits
(7) Incoming Partner
(8) Outgoing or Retiring Partner
(9) Partner by Estoppel or Partner by Holding Out
(10) Minor Partner

(1) Actual or Ostensible Partner

He is a partner who actively participates in the management of the company. He is responsible for any
business actions that affect other parties. He has to announce his retirement to the general public. His lunacy
may make him unable of carrying out his responsibilities, which may lead to the firm's demise.

(2) Dormant Partner or Sleeping Partner

An inactive partner is nevertheless responsible for the company's debts and obligations just like any other
partner. Similar to an unidentified principal, if his status as a partner is revealed, he may be held
accountable. He does not need to give notice in order to release himself from responsibility for the actions of
his other partners when he no longer counts as one of them. His insanity is not a reason for the corporation to
be dissolved even if he is incapable of carrying out his responsibilities.

(3) Nominal Partner

A nominal partner is a partner only in name. He does not actually own any of the company's stock; he
merely lends his name to it. Despite not actually owning any of the company's stock, he is nonetheless
responsible for all of the firm's actions as if he were a true partner. His insanity is not a reason for the firm to
be dissolved if he is unable to perform his tasks.

7|Page
(4) Sub-Partner
He is a third party with whom one of the partners has agreed to split the company's revenues. He is not a
legal partner, he has no claims against the company, and he is not responsible for the firm's debts. Since he is
not a partner, there is no need to give the public notice. His insanity is not a reason for the corporation to be
dissolved even if he is incapable of carrying out his responsibilities.

(5) Working Partner

A partner may be given management and control of the company due to his unique qualifications. He often
receives a fixed income in addition to his portion of the earnings, and the other partners will be held
accountable for all of his actions.

(6) Partner only in Profits

He is a partner who only splits gains with you, not losses. Along with the other partners, he is equally
responsible to third parties for all actions of the business. He must publicly announce his retirement. His
insanity is not a reason for the corporation to be dissolved even if he is incapable of carrying out his
responsibilities.

(7) Incoming Partner

He is a person who is accepted as a partner in a business that is already established with the agreement of all
of the current partners or in accordance with an agreement already made between existing partners for the
admission of a new partner under S. 31. According to the justification, the partnership will remain successful
as long as all parties agree to the introduction of a new partner.

In Byrne v. Reid,18 A, B, C and D were four partners and they, in their partnership deed, authorised A to admit
his son, S into partnership when S had attained the age of twenty-one years. After S attained the age of twenty-
one years, A nominated him as a partner in accordance with the partnership deed and he accepted the
nomination, but the other partners refused to recognise him as a partner. It was held that the son on accepting
the nomination had become a partner. It may be noted that a person does not become a partner merely by his
nomination. He has an option to become a partner or not. 19 He becomes a partner when after nomination he
expressly or impliedly agrees to the same.20

8) Outgoing or Retiring Partner

18
(1902) 2 Ch. 735
19
Pigott v. Bagley, Mc Cl. & Y. 569
20
Mulchand v. Manekchand (1906) 8 Bom LR 8
8|Page
A partner can retire from a firm in the following ways:
(a) By the consent of all the other partners,
(b) In accordance with an express agreement between the partners,
(c) By notice to all partners of the intention to retire in case of partnership at will.
Upon retirement, a person ceases to be partner. However, third parties may presume mutual agency between
the outgoing and continuing partners (by doctrine of holding out) until a public notice of retirement is given.
A public notice, as explained in S. 72, must be given upon retirement.

In M/s. P.P.M. Sankaralinga Nadar Sons v. Dr. D Rajkumar, 21 it has been held that under Section 32(2)
of the Act a retired partner can be discharged from his liability only by way of an agreement entered into
between him and the other partners along with third parties so as to discharge him from all the liabilities to the
firm. A partner who leaves a firm in which the rest of the partners continue to carry on the business is an
outgoing partner. There are other methods too whereby a partner may become an outgoing member or leave
the firm, as listed below:By expulsion from the firm, Due to his insolvency, Death of a partner.

(10) Partner by Estoppel or Partner by Holding Out

The rule of agency by Estoppel has been extended to the case of partnership too. Holding out is the application
of the principle of Estoppel which is a rule of evidence wherein a person is prevented or 'estopped' from
denying a statement he made or existence of facts that he makes another person believe. Holding out refers to
course of action or omission that leads others to believe that one possesses an authority which in fact one does
not. Simply put, if a person represents that he is a partner of a particular firm, he is estopped from denying this
representation later on.

S. 28 says that a person is held liable as a partner by holding out if:

(a) He represented himself or knowingly allowed himself to be represented as a partner. However, In case it
is being represented that a person A is a partner in a firm but A is not aware of such a representation, the
question of A's liability under the doctrine of holding out does not arise. The position can be explained by
referring to the case of Munton v.Rutherford22 In that case one Beckwith published a statement in a
newspaper that he and Mrs. Rutherford had formed a partnership. The statement was false and Mrs. Rutherford
did not know about the same. It was held that Mrs. Rutherford was not liable as a partner by estoppel or holding
out.
(b) Such representation may be by spoken or written words, by conduct or by knowingly permitting others to
make such representation by words or conduct.
(c) The other party on the faith of such representation gave credit to the firm.

21
2009 (2) LW 404 (Mad.)
22
12 Mich. 418
9|Page
(10) Minor Partner
To create partnership between a number of persons they must have entered into a contract to the effect and
that the relation of partnership arises from contract and not from status. That obviously implies that all the
essentials of a valid contract are to be satisfied and, therefore, all the partners must be competent to contract.
A minor is competent to contract, his agreement is void and, therefore, he is incapable of becoming a partner
in any partnership firm. In Mohribibi v. Dharmodas Ghose,23 it was held that a minor cannot enter into a
contract and minor's contract is void. If, while creating partnership, a minor is made a full-fledge partner in a
partnership firm, the deed would be invalid and the document cannot be enforced even vis-a-vis other
partners.24 Minor's admission to the benefits of partnership- The agreement by a minor is void, but he is capable
of accepting benefits. In consonance with this position of law, Section 30(1) provides that a minor may not be
a partner in a firm, but with the consent of all the partners for the time being, he may be admitted to the benefits
of partnership. Such an introduction presupposes existence of a valid partnership between persons competent
to contract. However, there can be no partnership firm with just one adult and all other partners being minor.

Conclusion
A partnership is a type of commercial organisation in which two or more people come together to run a
business together. This increases the potential for profit and innovation by enabling the pooling of resources
and the distribution of labour among the partners. S. The definition of a partnership in Section 4 of the Act is
"the relationship between persons who have agreed to share the profit of a business carried on by all or any of
them acting for all." This definition of a partnership is more comprehensive than the one found in the Indian
Contract Act, 1872 because it now also takes into account the crucial concept of "mutual agency," which was
missing from the earlier definition. Individually, those who have formed a partnership with one another are
referred to as partners; together, they are referred to as a "firm," and the name under which they conduct
business is referred to as the "firm name." S. Partnership is not created by status, according to paragraph 5. It
makes it clear that a partnership relationship can only develop as a result of a contract. According to the Act,
there are several different types of partnerships that can be categorised under the following headings: 1) On
the basis of Duration - Partnership-at-Will, The Particular Partnership, 2) On the basis of Tenure - Partnership
for a Fixed Term, Flexible Partnership, 3) On the basis of Nature - General Partnership, Limited Liability
Partnership (LLP), 4) On the basis of Registration - Unregistered Partnership Firm, Registered Partnership
Firm. Additional categories of partners include Actual or Ostensible Partners, Dormant Partners or Sleeping
Partners, Nominal Partners, Sub-Partners, Working Partners, Partners Only in Profits, Incoming Partners,
Outgoing or Retiring Partners, Partners by Estoppel or Partners by Holding Out, and Minor Partners.

23
1903 ILR 30 CAL 539
24
Dharam Vir v. Jagan Nath, AIR 1968 Punj. 84
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 Bibliography
Books referred-
R.K. Bangia, The Indian Partnership Act, 1932 (Allahabad Law Agency, 14th edn., 2022)
Avtar Singh, Law Of Partnership (Eastern Book Company, 11th ed., 2018)

Websites referred-
www.lexology.com – Accessed on October 24, 2023
www.mondaq.com – Accessed on October 24,2023
www.legalbites.com – Accessed on October 24,2023
www.blogipleaders.com – Accessed on October 24,2023
www.lawbhoomi.com – Accessed on October 24, 2023

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