Purchase and leasing of property in the name of partnership firm
DINESH GHATKAR
(Querist) 27 November 2014
This query is : Resolved
Can a partnership firm enter into a contract for purchasing immovable property in the name of firm and subsequently leasing it in the name of firm ?
Can partnership firm enter into a contract in the name of firm ?
What is the meaning of person under the Indian Contract Act ? Does it include partnership firm under the definition of firm as similar to Income Tax Act?
Sailesh Kumar Shah
(Expert) 27 November 2014
Can a partnership firm enter into a contract for purchasing immovable property in the name of firm and subsequently leasing it in the name of firm ?
answer : yes
Can partnership firm enter into a contract in the name of firm ?
answer : yes
What is the meaning of person under the Indian Contract Act ? Does it include partnership firm under the definition of firm as similar to Income Tax Act?
answer: state full facts
DINESH GHATKAR
(Querist) 27 November 2014
As per my client, being a partnership firm, it is not a legal entity and hence can not enter into a contract. Also person is not defined under Indian Contract Act. Partnership firm can enter into a contract only through its partners and not by the name of partnership firm. While defining who is competent to enter into a contract, Indian contract act states that a person should not be disqualified under any law to enter into a contract. And partnership firm disqualifies firm to enter into a contract in the name of firm under Partnership Act.
Sailesh Kumar Shah
(Expert) 28 November 2014
It is right to say that partnership entity is not legal entity. all partners are jointly and severally liable for the act of firm/partner.
It is incorrect to say that partnership firm can not enter into contract in its name.
Sailesh Kumar Shah
(Expert) 28 November 2014
It would be better to get registered partnership firm, if not registered.
