Commerce - Types of Partnership | 11th Commerce : Chapter 5 : Hindu Undivided Family and Partnership
Chapter: 11th Commerce : Chapter 5 : Hindu Undivided Family and Partnership
Types of Partnership
Types of Partnership
Partnership at will
Partnership formed to carry on
business for an undefined period is called partnership at will. In other
words, no time-limit is specified
for the continuance of the firm.
It is to be dissolved when a partner gives notice of his intention to dissolve
the partnership. Thus this type of partnership continues its business
activities as long as there is mutual
cooperation and confidence among partners. Since it comes to an end at the will
of any partner on his giving notice, it is called partnership at will.
Partnership for a fixed term
Where a partnership is formed for a
definite period of time, it
is known as partnership for a fixed term. The
partnership for a fixed term comes to an
end on the expiry of the stipulated period. But if the business is continued
even after the original fixed period, it automatically becomes a partnership at
will. As such it will be terminated at the will of any partners, giving notice
of his intention to do so.
Particular partnership
When a partnership is formed to carry on
a particular venture or a business of temporary nature, it is called particular
partnership. Such a firm lasts so long as thebusinessagreeduponisnotcompleted.
In other words, it comes to an end on the completion of the particular venture.
If such a firm is not dissolved and it begins to undertake new activities not
originally contemplated, the rights and obligations of the partners continue to
be the same as in the original partnership and it will continue till a partner
gives a notice of his intention to dissolve the firm.
Limited Liability Partnership (LLP)
Limited Liability Partnership is very
popular in the service sector and in the small scale business enterprises.
Limited liability partnership means for paying the debts of the firm only the
assets of the business will be utilized and
not the personal properties. It
is prevalent among popular professionals such as Cost Accountants, Company
Secretaries, Chartered Accountants, Lawyers, Architects, Engineers and Doctors.
Limited Liability Partnership is available in countries like U.S.A, Singapore,
Thailand and U.K. It came into existence in India since 2008.
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