Partnership Firm Registration

Two or more people when come together with a common idea of business by infusing the sources and funds together with the common goal of earning profit is termed as Partnership. Partnership Firm is one of the common forms of business in India as it does not require stringent procedure to be followed and avails the flexibility in administration to the Partners. The formation of Partnership Firm shall be with mutual consent of Partners to the business. The firm shall be formed and registered by following the procedure prescribed in this regards under Indian Partnership Act, 1932.

Registering a firm under the Partnership Act (hereinafter called the Act) is not mandatory as in the case of setting up a company. However, it is always advisable to get your firm registered at Registrar of Firms/Department of Industries of the Town/City where you are planning to set up the business. This ensures that you get a legal proof of the firm's existence. Apart from that, the Act provides various benefits and rights to every partner - filing a suit in case of disputes, settling claims against third/external parties, etc. In case of any disputes, a court of law would first check the terms and conditions under which the partnership was formed. Registration of Partnership Deed takes care of this.

The Partnership Firm is best suitable for starting any business having small scale of operations and requires flexibility in operations. Also, where the business idea involves higher risk of discontinuation or failure of products, can be started with Partnership Firm, which afterwards can be converted into any other form of business with the stability and growth of the business.