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Dissolution of Partnership vs Firm

Two manufactu...

Question

Two manufacturing firms, each having twenty members, amalgamate their business. Can contracts entered into by the amalgamated firm be enforced by the firm?

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Solution

Solution : Section to which the given problem relates Section 11 of the Companies Act,1956.
Decision: No.
Reason: The amalgamated firm is an illegal association because such firm consists of 40 persons which exceeds the statutory limit of 20 persons.

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