Partnership Firm Registration
Assistance in formation of partnership firms and related regulatory compliances.
We provide professional services relating to formation of partnership firms, including assistance in documentation, preparation, and filing of applications with the Registrar of Firms, as applicable.
Basics of Partnership Registration
To start a Partnership firm, partners need to enter into an agreement which is popularly known as Partnership Deed. Different states impose different stamp duty on the partnership agreements/deeds. So, while creating a partnership instrument (Deed), the partners must purchase stamp paper of appropriate value, as applicable in the respective state, to be annexed with the agreement. You can further get an agreement notarized. Sure, registration of partnership Firm is not mandatory under The Partnership Act, 1932. However, Section 69 of the act specifies the effect of Non-Registration. According to Sectio 69, an unregistered firm shall not be able to recover any sum more than Rs. 100. Registration of a partnership firm may be considered based on legal and operational requirements..
Requirements to Register a Partnership Firm
1. Firm Name
Name of the firm should be unique, and it should not same or similar to the name of any existing registered or applied trademark.
2. Minimum Two Persons
Two persons are needed to become partners of the firm. However, a maximum of 20 partners can be present a firm (10 in banking business)
3. No Minimum Capital
You need to base the Minimum capital on the business requirements and there’s no minimum prescription. The capital of the firm determines the Stamp Duty on the deed.
4. No FDI allowed
Law does not permit foreign investment in a partnership firm. In the firm, only an Indian citizen can become the partner and start the partnership firm.
Procedure for Registering a Partnership
1. Name Selection
Selection of an appropriate name for the firm. Due care has to be taken to see that it does not violate the trademark of any other person or prohibited emblems and names.
2. Place of Business
It is important that the firm should have a proper address since all official communications will be sent only to this address. The jurisdiction of the registrar will be ascertained by this address.
3. Partnership Deed
Execute the partnership deed and stamp with appropriate stamp duty : By the partnership deed, the right, duties and liabilities of the partners is ascertained. All the partners to the firm are governed by the terms and conditions mentioned in the agreement. The stamp duty will vary from state to state and is based on the total amount of contribution by all partners.
4. Application for registration
Along with the documents mentioned above, an application in the prescribed format needs to be submitted to the Registrar of Firms located in the jurisdiction mentioned in the official communication address. On receipt of the application, the Registrar will verify all documents. If satisfied that the provision of the Partnership Act is complied with, the Registrar will enter the particulars in the Register of Firms and issue an acknowledgment in the prescribed format.
Documents Required
1. Photographs of Each Partner
2. PAN Card Copy of Partners
3. Identity Proof (Aadhaar / Voter ID / Driving License / Passport)
4. Address Proof (Bank Statement / Electricity, Mobile, Telephone Bill) Any One
5. Utility Bill as Proof of Registered Address
6. NOC from the Owner of the Premises
Advantages of Partnership Firm
1. Simple Structure
Relatively simple structure and operational framework.
2. Registration is not Mandatory
Registration of Partnership under the Partnership Act is not Mandatory. It is optional to the partners of the Firm. However, an unregistered partnership may face difficulties in getting the agreement terms enforced under law.
3. Compliance Needs
Compliance requirements vary compared to other business structures, depending on applicable laws