Click to Download : Partnership Deed Format in word
Partnership Deed
This indenture of partnership is made on [Date, Month, Year] by and amongst:
- [First Partner’s Name], [Son/Daughter] of [Mr. Father’s Name], residing at [Address Line 1, Address Line 2, City, State, Pin Code] hereinafter referred to as FIRST PARTNER.
- [Second Partner’s Name], [Son/Daughter] of [Mr. Father’s Name], residing at [Address Line 1, Address Line 2, City, State, Pin Code] hereinafter referred to as SECOND PARTNER.
- [Third Partner’s Name], [Son/Daughter] of [Mr. Father’s Name], residing at [Address Line 1, Address Line 2, City, State, Pin Code] hereinafter referred to as THIRD PARTNER.
- [Fourth Partner’s Name], [Son/Daughter] of [Mr. Father’s Name], residing at [Address Line 1, Address Line 2, City, State, Pin Code] hereinafter referred to as FOURTH PARTNER.
AND whereas, the parties hereto have agreed to commence a new business under partnership and it is expedient to have written instrument of partnership. Now this partnership deed witnesses as follows:
- BUSINESS/FIRM NAME
The parties here to have mutually agreed to carry on the business in the name & style of “M/s XYZ Exporters”, or in any other name or names as the parties herein after may agree from time to time.
- BUSINESS ACTIVITY
The parties here to have mutually agreed to carry on the business of [Description of Business Activity Proposed]. AND the scope of this partnership business may be enlarged to expand or change to any other business as the parties hereto mutually decide from time to time.
- PLACE OF BUSINESS
The principal place of the partnership business will be situated at [Address Line 1, Address Line 2, City, State, Pin Code] or at any other place or places as the parties herein after may agree from time to time.
- DURATION OF PARTNERSHIP
The duration of the partnership will be at will i.e., the partnership shall be a “Partnership at will”.
- CAPITAL OF THE FIRM
The business shall be started with an Initial capital of Rs. [Total Partners Contribution] only which shall be contributed by the parties as per Profit sharing ratio.
The necessary capital as well as further funds required for the purpose of the partnership business shall be contributed, or raised, by the partners in such a manner as may mutually be agreed by and between the parties from time to time.
It has been decided to pay interest @ 12% per annum or such other rate as may be prescribed under section 40(b) (iv) of the IT Act, 1961 or any other applicable provisions as may be in force in the income tax assessment of the partnership firm for the relevant assessment year, which shall be payable to the partners on the amount outstanding to their credit in the books of accounts of the firm. Interest shall be calculated and credited to the account of each partner at the close of the accounting year. In the case of loss or profit being insufficient to meet the interest obligation to the partners @ 12% per annum, the rate of interest may be lower or even nil as may be agreed to by and among partners from time to time.
- PROFIT SHARING RATIO
The profit or loss of the firm shall be shared equally among all the partners and transferred to partner’s current account.
- MANAGEMENT
The [First Partner] shall be Managing Partner of the firm within the meaning of the explanation 4 to section 40(b) of the income tax act, 1961, or any other future amendment thereof which may be in-force in relevant financial year and he will look after all the day to day transaction of the firm and any legal activities in the name of the firm and the remaining partners shall co-operate to do so.
- REMUNERATION
All partners have agreed to keep themselves actively engaged in conducting the affairs of the business of the partnership firm. It is hereby agreed to that, in consideration of the said parties keeping themselves actively engaged in the business of the partnership firm and working as Working partners, shall be entitled to remuneration.
The remuneration payable to the said working partners shall be computed in the manner laid down or deduction under section 40(b)(v), read with explanation 3 of the income tax act, 1961 or any other applicable provision as may be in-force in the income tax assessment of the partnership firm for the relevant accounting year. Such amount of remuneration shall be distributed equally among the said working partners.
The partners shall be entitled to increase or reduce the above remuneration. The partners may also agree to revise the mode of calculating the above said remuneration as may be agreed to by and between the partners from time to time.
- OPERATION OF BANK ACCOUNTS
The firm shall open a current account in the name of [Partnership Firm Name] at any bank and such account shall be operated by [First Partner] and [Second Partner] jointly as declared from time to time to the Banks.
- BORROWING
The written consent of all Partners will be required for the partnership to avail credit facilities from any financial institution.
- ACCOUNTS
The firms shall regularly maintain in the ordinary course of business, true and correct accounts of all its transactions and also of all its assets and liabilities, which shall ordinarily be kept at the firm’s place of business. The accounting year shall be the financial year from 1st April onwards and on 31st day of March every year, the books of accounts of the firm, shall be closed and adjusted and as soon thereafter the balance sheet shall be drawn up and shall be properly audited and the same shall be signed by all the Partners.
Every Partner shall have access to the books and the right to verify their correctness.
A profit and loss account of the firm shall also be drawn up determining the profits earned or loss suffered by the partnership firm.
- RETIREMENT
If any partner shall at anytime during the subsistence of the partnership, be desirous of retiring from the firm, it shall be competent from his to do so, provided he shall give at least one calendar month notice of his intention of doing so. The remaining partner shall pay to the retiring partner or his legal representatives of the deceased partner, the purchase money of his share in the assets of the firm.
- DEATH OF PARTNER
In the event of the death of any partners, the partnership firm shall not stand dissolved but shall be carried on by the surviving partners and one of the legal representatives of the deceased partner shall become the partner of the firm and in the event the legal representative show their denial to point the firm, they shall be paid the part of the part of the purchase amount calculated as on the date of the death of the partner.
- ARBITRATION
Whenever there by any difference of opinion or any dispute between the partners the partners shall refer the same to an arbitration of one person. The decision of the arbitration so nominated shall be final and binding on all partners, such arbitration proceedings shall be governed by Indian Arbitration Act, which is in force.
- That the business of the partnership firm shall be carried on maintaining the common advantage of all the parties hereto and each party shall be just and faithful in all matters.
- No Party shall –
- Sell or otherwise transfer his share in the partnership to any person without the written consent of the parties having being previously obtained.
- Do any act or acts or things whereby the partnership assets and properties shall become liable for any private debit.
- Be at the liberty to pledge, hypothecate or otherwise encumber the properties and asset of the partnership without the previous written consent of the other parties and;
- Apply the partnership fund in Speculative transaction.
- The matters not provided above for the provisions of the Indian Partnership Act, 1932 as amended from time to time shall apply.
In witness whereof, this deed of partnership is signed sealed and delivered this [Day, Month, Year] at [City, State]:
SIGNATURE OF THE PARTNERS:
FIRST PARTNER SECOND PARTNER
THIRD PARTNER FOURTH PARTNER
SIGNATURE OF THE WITNESSESS:
WITNESS ONE WITNESS TWO
