Explain the process dissolution of partnership firm?
Dissolution means breaking of relationship among the partners. As per Section 39 of the Indian Partnership Act 1932 the dissolution of firm implies that not only partnership is dissolved but the firm losses its existence i.e. after dissolution the firm does not remain in business. Dissolution of partnership firm implies discontinuation of the business of the partnership firm. Dissolution involves winding up of business disposal of assets and paying off the liabilities and distribution of any surplus or borne of loss by the partners of the firm. As per thePartnership Act 1932 a partnership firm may be dissolved in the following manners.
i) Dissolution by Agreement: As a firm is formed with the consent of all partners with a mutual agreement. Dissolution can also be there with the help of agreement. It happens in following two ways. A firm may be dissolved a When all the partners 10 agree to dissolve the firm. b When there is any term related to dissolution of firm in the partnership agreement.
ii) Compulsory Dissolution: A firm may be dissolved compulsorily in the following condition a In case all the partners or all except one partner become insolvent or insane. b If the business becomes illegal. c Where all the partners except one decide to retire from the firm. d Where all the partners except one die.
iii) Dissolution by Notice: When partnership is at will then the partnership firm
may be dissolved if any partner give notice in writing to all the other partners expressing his/her intention to dissolve the firm.
iv) Dissolution by Court: A court may order for dissolution if a suit is filed by a
partner as per Section 44 of Indian Partnership Act 1932. The court may order to
dissolve a partnership in following conditions:
a) A partner becomes insane.
b) A partner commits breach of agreement wilfully.
c) When a partner’s conduct affects the business.
d) When a partner transfers his interest to a third party.
e) If business cannot be continued.
f) If a partner becomes incapable of doing business.
g) If court thinks dissolution to be just and equitable on any ground. Besides these above mentioned circumstances a partnership firm may be dissolved if the court at any stage finds dissolution of the firm to be justified and inevitable.
NCERT questions are designed to test your understanding of the concepts and theories discussed in the chapter. Here are some tips to help you answer NCERT questions effectively:
This question is important because it tests key concepts from the NCERT syllabus and is frequently asked in CBSE exams.
This question is based on core NCERT concepts explained in the chapter and should be revised thoroughly before exams.
Students often lose marks by skipping steps, writing incomplete explanations, or misunderstanding keywords used in the question.
Dissolution means breaking of relationship among the partners. As per Section 39 of the Indian Partnership Act 1932 the dissolution of firm implies that not only partnership is dissolved but the firm losses its existence...
Step-by-step explanation:
• Dissolution means breaking of relationship among the partners
• As per Section 39 of the Indian Partnership Act 1932 the dissolution of firm implies that not only partnership is dissolved but the firm losses its existence i
• e
• after dissolution the firm does not remain in business
• Dissolution of partnership firm implies discontinuation of the business of the partnership firm
Stay updated with our latest educational content and study tips
Parent-Teacher Meetings (PTMs) are more than quick updates on marks — they’re a chance to build a real partnership between home and school. A good Parent-Teacher Meeting conversation helps parents see beyond grades. It opens up insights about a child’s strengths, struggles, emotions and even hidden talents. When parents participate actively, they don’t just track […]
Read More
In today’s world of endless information , knowing how to think is more important than knowing what to think . From school projects to real – life decisions , critical thinking helps students question ideas , analyze facts and form logical conclusions . But what exactly does critical thinking mean ? Simply put , it’s […]
Read More
Every student dreams of better grades , stronger focus and more study time – but the real challenge isn’t starting, it’s staying consistent . Building productive study habits is not about studying all day , it’s about studying smart . In today’s fast – paced digital world, distractions are everywhere – from endless phone notifications […]
Read More
Online gaming has rapidly become one of the most popular pastimes among children. Whether it’s multiplayer mobile games , PC adventures or console challenges , kids are spending more time than ever in the virtual world . On the surface, gaming seems entertaining and even educational – improving hand- eye coordination , teamwork and problem […]
Read More
Student Discussion
Be the first to comment.
ADD NEW COMMENT