Question

When it is not registered, a partnership firm is ________.

• A. Deemed to be illegal organization and disallowed to carry on business
• B. Allowed to carry on business subject to payment of penalty
• C. Allowed to carry on business subject to certain disabilities
• D. All of the above

Answer 1

The correct option is C Allowed to carry on business subject to certain disabilities

If the partnership firm is not registered, it has to remain deprived of following advantages:

1. No partner can take any legal action against any other partner.
   
2. No partner can intimate proceedings against the firm in order to get his rights.
3. The firm, too,cannot start proceedings against any partner.
4. The firm cannot proceed against other parties, while the other parties can proceed against the firm.