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Which of the following is not disability of an unregistered firm?
- a)It cannot file a suit against third parties
- b)Its partners cannot file a suit against a firm.
- c)It cannot claim a set-off exceeding Rs. 100.
- d)It cannot be sued by a third party.
Correct answer is option 'D'. Can you explain this answer?
Most Upvoted Answer
Which of the following is not disability of an unregistered firm?a)It ...
Unregistered firms refer to partnerships that are not registered under the Partnership Act, 1932. These firms lack the legal recognition and protection that registered firms enjoy. While there are several disabilities associated with unregistered firms, the correct answer is option D, which states that an unregistered firm cannot be sued by a third party.
Explanation:
Unregistered firms face certain limitations and disabilities due to their lack of legal recognition. Let's examine each option to understand the disabilities of an unregistered firm:
a) It cannot file a suit against third parties:
- This is a disability of an unregistered firm. Since it lacks legal recognition, it cannot file a suit against third parties to enforce its rights or seek remedies.
b) Its partners cannot file a suit against a firm:
- This is also a disability of an unregistered firm. The partners of an unregistered firm cannot file a suit against the firm to enforce their rights or seek remedies.
c) It cannot claim a set-off exceeding Rs. 100:
- This is another disability of an unregistered firm. A set-off refers to the adjustment of mutual debts between the firm and a third party. An unregistered firm cannot claim a set-off exceeding Rs. 100, meaning it cannot offset debts exceeding this amount against amounts owed to it.
d) It cannot be sued by a third party:
- This statement is incorrect. An unregistered firm can indeed be sued by a third party. Even though the firm lacks legal recognition, it can still be held liable for its actions and can be sued by third parties to seek remedies or claim damages.
Therefore, the correct answer is option D, as it incorrectly states that an unregistered firm cannot be sued by a third party. In reality, an unregistered firm can be held legally accountable and can be sued by third parties.
Explanation:
Unregistered firms face certain limitations and disabilities due to their lack of legal recognition. Let's examine each option to understand the disabilities of an unregistered firm:
a) It cannot file a suit against third parties:
- This is a disability of an unregistered firm. Since it lacks legal recognition, it cannot file a suit against third parties to enforce its rights or seek remedies.
b) Its partners cannot file a suit against a firm:
- This is also a disability of an unregistered firm. The partners of an unregistered firm cannot file a suit against the firm to enforce their rights or seek remedies.
c) It cannot claim a set-off exceeding Rs. 100:
- This is another disability of an unregistered firm. A set-off refers to the adjustment of mutual debts between the firm and a third party. An unregistered firm cannot claim a set-off exceeding Rs. 100, meaning it cannot offset debts exceeding this amount against amounts owed to it.
d) It cannot be sued by a third party:
- This statement is incorrect. An unregistered firm can indeed be sued by a third party. Even though the firm lacks legal recognition, it can still be held liable for its actions and can be sued by third parties to seek remedies or claim damages.
Therefore, the correct answer is option D, as it incorrectly states that an unregistered firm cannot be sued by a third party. In reality, an unregistered firm can be held legally accountable and can be sued by third parties.
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Which of the following is not disability of an unregistered firm?a)It cannot file a suit against third partiesb)Its partners cannot file a suit against a firm.c)It cannot claim a set-off exceeding Rs. 100.d)It cannot be sued by a third party.Correct answer is option 'D'. Can you explain this answer?
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