In determining whether a group of persons is or is not a firm or whether a person is or is not a partner in a firm, regard shall be had to _________.

Sharing of profits

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Written contract

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Real relation between the parties

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Provisions of the Partnership Act,

1932

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Solution

The correct option is C Real relation between the parties
According to the Partnership Act, 1932 the relation between the partners of a partnership firm can only be created through a mutual agreement between the partners which will be presented in the manner of contract that can be verbal as well as written also. But nowadays written is given more preference due to legal requirements. A contract sets real relationship between the partners.

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Similar questions

Q. The law relating to partners by holding out is contained in Section

28

, which lays down thus: "Anyone who by words, ________ represents himself, or knowingly permits himself to be represented to be a partner in a firm, is liable as a partner in that firm to anyone who has on the faith of any such representation given credit to the firm, whether the person representing himself or represented to be a partner does or does not know that the representation has reached the person so giving credit".

Q. State with reason whether at the time of admission of a partner, partnership is dissolved or partnership firm is dissolved.

Q. According to Partnership Act, 1932, it is not compulsory for a partnership firm to get itself registered, then why do partners prefer to get the firm registered?

A

and

B

are partners in a firm without a Partnership Deed.

A

is an active partner and claims a salary of

R s . 18, 000

per month. State with reason whether the claim is valid or not.

According to India Partnership Act 1932, it is not compulsory for a partnership firm to get itself registered, then why do partners prefer to get the firm registered ?

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