Can a Company be a partner under Indian Partnership Act,1932

Thank u, Mr. Subramanium, for your prompt reply.

But, in case two or more individuals and a Company want to enter into partnership....

A limited company whether public or private is a legal person capable of entering into valid contracts including partnership agreements. Thus there is no legal bar. The company can authorise a person to attend the meetings of the partners and to generally represent the company in other matters relating to the management and administration of the firm.

A limited company whether public or private is a legal person capable of entering into valid contracts including partnership agreements. Thus there is no legal bar. The company can authorise a person to attend the meetings of the partners and to generally represent the company in other matters relating to the management and administration of the firm.

sivadas chettoor B.COM FCA LL.M

siva208@yahoo.com

Hello,

I agree with Mr. Sivadas Chettur, further adding to that the Partnership deed registered  should also contain a special clause to this effect. So as to ensure more clarity and to avoid the legal chaos.

gud question..but u c dat  in partnership liability of partners is unlimited but in company it it limited

It is the liability of members which is limited in a limited company, and not that of the company itself. The liability of a limited company itself can be or rather is always unlimited. Being separate legal entity a Ltd. co. can enter into a partnership with other individual partners.  

I wish to add a few lines. A company enters into a partnership as a single legal person and not as a group of shareholders that company may comprise of. The word "person" is not defined under the Companies Act 1956 and therefore one can make a useful reference to Sec 3(42) of the General Clauses Act 1897 wherein it was defined to include a company as well.  

The Hon' Supreme Court in Bucha.F Guzdar AIR 1955 SC 74 held that an agreement of partnership between 3 companies is valid and consists of 3 partners.In Newstead v Frost the House of Lords also held that a partnership agreement between an individual and a company is valid.

Please not that the memmorandum of assn of the company must authorise the entering into partnership lest it becomes ultra vires and void. But for these matters the partnersip is absolutly valid. The company as a partner assumes unlimited liability but limited to the extent of assets answerable for the debts of the company.

Please also note that a firm cannot be a member of the company.

siva208@yahoo.com

Please note that The Hon Supreme Court in Bacha.F.Guzdar's case held that a partnership consisting of only 3 companies as aprtners is valid. Like wise House of Lords in Newsteed v Frost also held that a company can be a partner in a firm. But the partnership should be authorised by the Memmorandum lest it will be ultra vires. A firm cannot be member in a company.Please also note that in the abscence of a definition of the term "person" under the companies act the defn under the General clauses Act 1897 shall apply. Thus the defn under the 1897 Act includes a company also.

siva208@yahoo.com

Please note that The Hon Supreme Court in Bacha.F.Guzdar's case held that a partnership consisting of only 3 companies as aprtners is valid. Like wise House of Lords in Newsteed v Frost also held that a company can be a partner in a firm. But the partnership should be authorised by the Memmorandum lest it will be ultra vires. A firm cannot be member in a company.Please also note that in the abscence of a definition of the term "person" under the companies act the defn under the General clauses Act 1897 shall apply. Thus the defn under the 1897 Act includes a company also.

siva208@yahoo.com

What about the liability of a 'partner' Co. in case the other partners fail to pay off?? will it be limited or unlimited?? if it is unlimited will it be contadictory to Companies Act??

what about the liability of a partner Co. if the other partners fails to pay it off?? will it be limited or unlimited?? if it is unlimited will it be contradictory to Companies Act??