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Question
Rohit is not a partner in a particular firm. But, he represents himself or knowingly permits himself to be represented as a partner of that particular firm to Sanjay, who on the faith of such a representation gives credit to the firm. Is Rohit liable as a partner in the firm?
Rohit is not a partner in a particular firm. But, he represents himself or knowingly permits himself to be represented as a partner of that particular firm to Sanjay, who on the faith of such a representation gives credit to the firm. Is Rohit liable as a partner in the firm?
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Solution
The correct option is C Yes. Rohit is liable as a partner by holding out
According to the Partnership Act, a partner by holding out refers to the partner who verbally or in written or through some conduct represents himself or knowingly permits himself to be represented as a partner in a firm who has not yet entered into the partnership agreement to take the advantage of the goodwill of the firm. These kind of
partners are liable to all the third parties arose due to them. Therefore, Rohit is also liable as a partner by holding out.
According to the Partnership Act, a partner by holding out refers to the partner who verbally or in written or through some conduct represents himself or knowingly permits himself to be represented as a partner in a firm who has not yet entered into the partnership agreement to take the advantage of the goodwill of the firm. These kind of
partners are liable to all the third parties arose due to them. Therefore, Rohit is also liable as a partner by holding out.
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