Question

'A' joined the partnership firm XYZ in $2006$. During the period of $2004$ to $2005$ XYZ has massive losses. XYZ is required to settle the loss of Rupees $70$ lakhs which happened during the period $2004-2005$. Is 'A' liable for the losses of XYZ for the period of $2004-2005$.

• A. A is equally liable with other partners of the firm
• B. A is not liable
• C. Only A is liable
• D. None of the above

Answer 1

The correct option is B A is not liable

A is not at all liable for any losses as the losses had incurred before the admission of A i.e in the year 2004-2005 and A's admission taken place in the year 2006 . If any losses incurred before the admission of any new partner then the new partner will not be liable for any losses . They will be liable for only those losses that take place after the admission of their admission.