Partnership firm

dharven (Querist) 11 March 2013 This query is : Resolved
respected sir,
without one partner out of three partners ,only(there are three partners in firm) two partners can sell property and bank not get possession yet.

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prabhakar singh (Expert) 11 March 2013
Time and again you are opening new posts to confuse the matter while in my first reply it was stated that a partner is principal for himself and agent for others.There is no question of majority or minority decision.
All depends on the deed of partnership wherein, if provided, even one partner can sale the property of firm.
All partners are expected to act in the best interest of the firm,so if sale is the beneficial and in the interest of the firm,the same can be made even if few are opposed to.But unless partnership deed,which is like code for partners the same can not be done under implied authority as in absence of such an authority in deed because under section 19(2)(g)such an act of sale of firms property shall not be treated to be an implied authority unless any usage or custom of trade to the contrary is proved to exist.

Then instead of telling that whether or not
there is a written deed of partnership,time and again you are repeating your same question.

So if there is no written partnership deed or when it is but no such authority mentioned in the deed,according to my view
all of first the minority partner should be EXPELLED by passing a resolution stating that the expulsion is necessary in the interest of the firm because firm is unable to discharge the debt without disposal of property which if auctioned shall fetch less money than if soled to the agreed buyer but since he is not agreeing to sale we have decided him to expel him from the firm. (read s.33 of partnership Act)On the date of expulsion an a/c should be prepared
to ascertain liabilities of the firm and the same should be debited individually into the personal a/c of each partner according to sharing ratio of the each and every partner and then a demand notice should be sent to the expelled partner.It would be better for fairness of the things that a/c so prepared is got audited by a C.A.

But this all would be possible only when bank has not issued any notice and has not taken over possession of mortgaged property of the firm.

If transfer is made before the retirement of loan property shall be deemed to have passed with burden of debt due to the bank
and such charge can be retired even by the buyer who in his option can with hold the debt amount from the total agreed amount of the sale consideration.Or it may also happen that take earnest by entering into agreement to sale ,retire the debt,and then execute the sale deed.

I think nothing is left now.

So better visit a C.A, as he would be able to handle not only accounting front but also legal front stated here.