Active partners / Working partners: Partners who actively participate in the day-to-day operations of the business.
Sleeping / dormant partners: Partners who do not participate in the day-to-day activities of the business.
Partners may be classified as ‘Nominal Partners’ and ‘Partners in Profits’.
Nominal partners allow the firm to use their name as partner.
They are liable to third parties for all the acts of the firm.
Partners can be classified as ‘Limited Partners’ and ‘General Partners’.
Liability of limited partners is limited to the extent of their capital contribution.
Partners having unlimited liabilities are called as general partners.
Partner by Estoppel: Person who behaves in the public in such a way as to give an impression that he/she is a partner of the firm
Partner by Holding out: If a partner or partnership firm declares that a particular person is a partner of their firm, and such a person does not disclaim it. He/she called Partner by Holding out.
Minimum two members required.
Agreement among the partners to carry on the business and share the profits and losses.
Agreement signed by all the partners. It includes:
Partners should get their firm registered with the Registrar of Firms of the concerned state.