SEBI & IPA

Securities and Exchange Board of India & Indian Partnership Act .

Presented by:
Vanshika Dharmani 11
Dhruti Jain 20
Mukti Jain 25
Tanvi Kodi 33
Diksha Makhija 39
Introduction to SEBI
❏ SEBI is a statutory body and a market regulator, which controls the
securities market in India.
❏ SEBI is run by its board of members. The board consists of a Chairman and
several other whole time and part time members. The chairman is
nominated by the union government.
❏ The others include two members from the finance ministry, one member
from Reserve Bank of India and five other members are also nominated by
the Centre.
❏ The headquarters of Sebi is situated in Mumbai and the regional offices
are located in Ahmedabad, Kolkata, Chennai and Delhi.
History of SEBI:
➔ The Securities and Exchange Board of
India (SEBI) is the regulatory body
for securities and commodity market
in India under the ownership of
Ministry of Finance within the
Government of India. It was
established on 12 April 1988 as an
executive body and was given
statutory powers on 30 January 1992
through the SEBI Act, 1992.
SEBI protectis the interests of investors investing in securities along with
regulating the securities market. SEBI also regulates how the stock
market and mutual funds function.

Objectives of SEBI:
Following are some of the objectives of the SEBI:
1. Investor Protection
Objectives
2. Preventing the fraudulent practices and malpractices
of
3. To develop a code of conduct for the financial intermediaries

4. To maintain a balance between statutory regulations and self SEBI

regulation.
Powers of SEBI:
1.To regulate and approve by-laws of stock
exchanges
2.Inspect the books of accounts of recognized
Powers
stock exchanges and call for periodical returns of
3.Inspect the books of financial
Intermediaries. SEBI
4.compel certain companies to get listed on
one or more stock exchanges
5.To handle the registration of brokers
SEBI has the following functions:
Functions
of
Protective
Function SEBI

Functions

Regulatory Development
Function Function
Definition of
Partnership Section 4
➔ The Indian Partnership Act
defines a partnership as
“Partnership is the relation
between persons who have
agreed to share the profits of a
business carried on by all or
any one of them acting for
all”.
 In a partnership firm, two or more
people come together to carry out a
business for the purpose of earning
profits and sharing those profits.

According to Section 12 of the Indian

Meaning Partnership Act, a partnership must be
formed for the purpose of carrying a
of business that is legal in nature.

IPA:
Types of Partnerships:
A partnership is divided into different types depending on the state and where the business operates.
Here are some general aspects of the five most common types of partnerships.

General Partnership
A general partnership comprises two or more owners to run a business. In this partnership, each partner
represents the firm with equal right. All partners can participate in management activities, decision
making, and have the right to control the business. Similarly, profits, debts, and liabilities are equally
shared and divided equally.

Limited Partnership
In this partnership, includes both the general and limited partners. The general partner has unlimited
liability, manages the business and the other limited partners. Limited partners have limited control over
the business (limited to his investment). They are not associated with the everyday operations of the firm.
In most of the cases, the limited partners only invest and take a profit share. They do not have any
interest in participating in management or decision making. This non-involvement means they do not
have the right to compensate the partnership losses from their income tax return.
Limited Liability Partnership
In Limited Liability Partnership (LLP), all the partners have limited liability. Each partner is
guarded against other partners legal and financial mistakes. A limited liability partnership is almost
similar to a Limited Liability Company (LLC) but different from a limited partnership or a general
partnership.

Partnership at Will
Partnership at Will can be defined as when there is no clause mentioned about the expiration of a
partnership firm. Under section 7 of the Indian Partnership Act 1932, the two conditions that have to
be fulfilled by a firm to become a Partnership at Will are:

The partnership agreement should have not any fixed expiration date.
No particular determination of the partnership should be mentioned.
Therefore, if the duration and determination are mentioned in the agreement, then it is not a
partnership at will. Also, initially, if the firm had a fixed expiration date, but the operation of the firm
continues beyond the mentioned date that it will be considered as a partnership at will.
Association of two or more persons: There
must be at least two persons to form a
partnership. However, section 464 of the
Companies Act, 2013 lays down that where
the firm is carrying any business, the number
of partners should not exceed 50 (It can be
increased upto 100).

Agreement between persons: According to

Section 5 of Partnership Act, the members of a
Hindu Joint Family carrying on a business, or ESSENTIALS
the co-owners of a business are not ‘partners’
because HUF and co-ownership are created
OF
by operation of law and not by contract. PARTNERSHIP
:
Business: Partnership can be formed only for the purpose of carrying on some business.
Section 2(b) of Partnership Act says that the term ‘business’ includes every trade,
occupation or profession. Thus, an association created primarily for charitable, religious and
social purposes are not regarded as partnership. Similarly, when two or more persons agree to
share the income of a joint property, it does not amount to partnership; such relationship is
termed as co-ownership.

Sharing of Profits: The division of profits is an essential condition of the existence of a

partnership. The sharing of profits is only a prima facie evidence of the existence of
partnership, and this is not the conclusive test of it.

Business carried on by all or any of them acting for all: The underlying or cardinal
principle which governs partnership is the mutual agency relationship amongst the partners. It
means each partner is the agent of the firm as well as of the other partners. The business of
the firm may be carried on by all the partners or by any of them acting for all.
 Types of Partners: Here we will look at six types of partners we come
across on a regular basis. This list is not exhaustive, the Partnership Act does not restrict any unique
kind of partnership that the partners want to define for themselves. Let us take a look at some of the
important types of partners.

Active Partner/ Dormant Partner/

Nominal Partner
Managing Partner Sleeping Partner

Partner by Partners in profit

Minor Partner
Estoppel only