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Partnership | Commerce - Rights of a Partner | 11th Commerce : Hindu Undivided Family and Partnership

Chapter: 11th Commerce : Hindu Undivided Family and Partnership

Rights of a Partner

Every partner has a right to take part in the management of the business.

Rights and Duties of Partners

The mutual rights and obligations are usually stated in the partnership deed. In the absence of any deed, the provisions of the partnership Act as stated below will apply.


Rights of a Partner

 

Right to take part in business

Every partner has a right to take part in the management of the business.

 

Right to be consulted

Every partner has the right to be consulted in all the matters concerning the firm. The decision of the majority will prevail in all the routine matters. But, where the matter is of fundamental importance such as admission of a new partner, change in the nature of business etc., decision must be unanimous.

 

Right of access to books, record and document

Every partner has the right of access to all records and books of accounts, and to examine and copy them.

 

Right to share profit

Every partner is entitled to share the profits in the agreed ratio. If no profit- sharing ratio is specified in the deed, they must be shared equally.

 

Right to receive interest

A partner has the right to receive interest on loans advanced by  him to the firm  at the agreed rate, and where no rate is stipulated, interest @ 6% p.a. allowed.

 

Right to be indemnified

Every partner has the right to be indemnified by the firm for all acts of other partners in the ordinary course of the business. He has a further right to receive back any amount spent by him on behalf of the firm. Only thing is he must have acted prudently.

 

Right to use partnership property for the business

Every partner has the right to use partnership property for the purpose of the partnership.

 

Right to retire

Every partner has a right to retire as per the terms of the deed or with the consent of the other partners. In case of partnership at will, he can retire at any time by giving prior notice to the other partners.

 

Right to continue

Every partner has the right to continue in the firm. He cannot be expelled except in accordance with the Partnership Deed.


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