Partnership firm process and procedure

Partnership firm process and procedure

A Partnership is one of the most important forms of a business organization. A partnership firm is where two or more persons come together to form a business and divide the profits in an agreed ratio. The partnership business includes any kind of trade, occupation and profession. A partnership firm is easy to form with fewer compliances as compared to companies.

The Indian Partnership Act, 1932 governs and regulates partnership firms in India. The persons who come together to form the partnership firm are known as partners. The partnership firm is constituted under a contract between the partners. The contract between the partners is known as a partnership deed which regulates the relationship among the partners and also between the partners and the partnership firm.

Procedure for Registering a Partnership Firm

Step 1: Application for Registration

An application form has to be filed to the Registrar of Firms of the State in which the firm is situated along with prescribed fees. The registration application has to be signed and verified by all the partners or their agents. 

The application can be sent to the Registrar of Firms through post or by physical delivery, which contains the following details:

  • The name of the firm.
  • The principal place of business of the firm.
  • The location of any other places where the firm carries on business. 
  • The date of joining of each partner.
  • The names and permanent addresses of all the partners.
  • The duration of the firm. 

Step 2: Selection of Name of the Partnership Firm

Any name can be given to a partnership firm. But certain conditions need to be followed while selecting the name::

  • The name should not be too similar or identical to an existing firm doing the same business.
  • The name should not contain words like emperor, crown, empress, empire or any other words which show sanction or approval of the government.

Step 3: Certificate of Registration

If the Registrar is satisfied with the registration application and the documents, he will register the firm in the Register of Firms and issue the Registration Certificate. The Register of Firms contains up-to-date information on all firms, and anybody can view it upon payment of certain fees.

An application form along with fees is to be submitted to the Registrar of Firms of the State in which the firm is situated. The application has to be signed by all partners or their agents.

Documents for Registration of Partnership

The documents required to be submitted to Registrar for registration of a Partnership Firm are:

  • Application for registration of partnership (Form 1)
  • Certified original copy of Partnership Deed.
  • Specimen of an affidavit certifying all the details mentioned in the partnership deed and documents are correct.
  • PAN Card and address proof of the partners.
  • Proof of principal place of business of the firm (ownership documents or rental/lease agreement).

If the registrar is satisfied with the documents, he will register the firm in the Register of Firms and issue a Certificate of Registration.

Register of Firms contains up-to-date information on all firms and can be viewed by anybody upon payment of certain fees.



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