Partnership is one of the most popular forms of business organizations in India due to ease of procedure it has. Partnership business is comparatively easy to set up less compliance required in such type of set up. Now question is what partnership deed is and how to create it? Well, partnership deed is the name given to partnership agreement which exists in writing. This deed r agreement shows the rights and responsibilities of all partners who are involved in a business. It has the description of law which is designed to guide the partners while conducting business activities. It is meant to help to reduce or eliminate the chances of disputes and disagreements over the role and responsibilities of each partner involved in the business and also the benefits which are for them
The partnership deed must be signed and stamped by all the partners in order to avoid any potential disputes. Contents of a partnership deed must include the following:
- The name of the company to be formed
- The name and addresses of the all partners
- The duration of the partnership
- the nature of the business
- the amount of capital that is to be invested by partners
- The clarifications about the drawing that partners can make
- The interest allowed and charged on capital and drawings
- Rights of partners
- duties and responsibilities of partners
- Remuneration to partners
- the ration of profit and losses that are to be shared by partners
- The basis for the calculation of the goodwill at the time of retirement or admission.
In other words, it can be said that a partnership deed is an agreement or document which is prepared to explain the rights, duties, amount of profits or losses to be beard, mutual rights, etc. Once partners are clear about their roles and duties, chances of any kinds of disputes get minimized. Procedure of registering a partnership firm is quite easy in India. What anyone would need to do is submit an application along with prescribed fee and submit to the registrar of firms of the state in which the firm is located. The documents that you may require include Application for registration of partnership in form no-1, Affidavit (Duly filled), Certified original copy of partnership deed, ownership proof of the principal place of business or rent/ lease agreement.
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