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Which one of the following statements is true.
- a)In a partnership, every partner is not an agent of the other partners.
- b)A partnership firm has no Legal personality distinct from its partners.
- c)In a partnership, the profits of the firm should be distributed equally among all partners.
- d)In a partnership, the liability of partner is limited to the extent of their Capital Contribution.
Correct answer is option 'B'. Can you explain this answer?
Verified Answer
Which one of the following statements is true.a)In a partnership, ever...
A partnership firm under the Indian Partnership Act, 1932, is not a distinct legal entity apart from the partners constituting it and equally in law the firm as such has no separate rights of its own in the partnership assets and when one talks of the firm’s property or firm’s assets all that is meant is property or assets in which all partners have a joint or common interest…The firm as such has no separate rights of its own in the partnership assets but it is the partners who own jointly or in common the assets of the partnership and, therefore, the consequence of the distribution, division or allotment of assets to the partners which flows upon dissolution after discharge of liabilities is nothing but a mutual adjustment of rights between the partners and there is no question of any extinguishment of the firm’s rights in the partnership assets amounting to a transfer of assets within the meaning of section 2(47) of the Act….”
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Most Upvoted Answer
Which one of the following statements is true.a)In a partnership, ever...
Partnership Firm and Legal Personality
Definition of Partnership Firm
A partnership firm is a form of business organization in which two or more persons come together to carry on a business and share profits and losses in a predetermined ratio.
Legal Personality of a Business Entity
A legal personality is a concept that recognizes a business organization as a separate entity from its owners. It means that the business has its own legal existence and can enter into contracts, sue and be sued in its own name, and own property.
Partnership Firm and Legal Personality
In a partnership firm, the partners are jointly and severally liable for the debts and obligations of the firm. This means that the personal assets of the partners can be used to pay off the debts of the firm. As a result, a partnership firm does not have a legal personality distinct from its partners.
Unlike other forms of business organizations such as a company or a limited liability partnership, a partnership firm does not have a separate legal existence. Therefore, a partnership firm cannot sue or be sued in its own name, and it cannot own property in its own name.
However, a partnership firm can still enter into contracts and conduct business activities in the name of the firm. The partners are also considered agents of the firm and can bind the firm in contracts with third parties.
Conclusion
In conclusion, option 'B' is the correct answer as a partnership firm does not have a legal personality distinct from its partners.
Definition of Partnership Firm
A partnership firm is a form of business organization in which two or more persons come together to carry on a business and share profits and losses in a predetermined ratio.
Legal Personality of a Business Entity
A legal personality is a concept that recognizes a business organization as a separate entity from its owners. It means that the business has its own legal existence and can enter into contracts, sue and be sued in its own name, and own property.
Partnership Firm and Legal Personality
In a partnership firm, the partners are jointly and severally liable for the debts and obligations of the firm. This means that the personal assets of the partners can be used to pay off the debts of the firm. As a result, a partnership firm does not have a legal personality distinct from its partners.
Unlike other forms of business organizations such as a company or a limited liability partnership, a partnership firm does not have a separate legal existence. Therefore, a partnership firm cannot sue or be sued in its own name, and it cannot own property in its own name.
However, a partnership firm can still enter into contracts and conduct business activities in the name of the firm. The partners are also considered agents of the firm and can bind the firm in contracts with third parties.
Conclusion
In conclusion, option 'B' is the correct answer as a partnership firm does not have a legal personality distinct from its partners.
Community Answer
Which one of the following statements is true.a)In a partnership, ever...
B
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Which one of the following statements is true.a)In a partnership, every partner is not an agent of the other partners.b)A partnership firm has no Legal personality distinct from its partners.c)In a partnership, the profits of the firm should be distributed equally among all partners.d)In a partnership, the liability of partner is limited to the extent of their Capital Contribution.Correct answer is option 'B'. Can you explain this answer?
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Which one of the following statements is true.a)In a partnership, every partner is not an agent of the other partners.b)A partnership firm has no Legal personality distinct from its partners.c)In a partnership, the profits of the firm should be distributed equally among all partners.d)In a partnership, the liability of partner is limited to the extent of their Capital Contribution.Correct answer is option 'B'. Can you explain this answer? for CA Foundation 2024 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about Which one of the following statements is true.a)In a partnership, every partner is not an agent of the other partners.b)A partnership firm has no Legal personality distinct from its partners.c)In a partnership, the profits of the firm should be distributed equally among all partners.d)In a partnership, the liability of partner is limited to the extent of their Capital Contribution.Correct answer is option 'B'. Can you explain this answer? covers all topics & solutions for CA Foundation 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Which one of the following statements is true.a)In a partnership, every partner is not an agent of the other partners.b)A partnership firm has no Legal personality distinct from its partners.c)In a partnership, the profits of the firm should be distributed equally among all partners.d)In a partnership, the liability of partner is limited to the extent of their Capital Contribution.Correct answer is option 'B'. Can you explain this answer?.
Which one of the following statements is true.a)In a partnership, every partner is not an agent of the other partners.b)A partnership firm has no Legal personality distinct from its partners.c)In a partnership, the profits of the firm should be distributed equally among all partners.d)In a partnership, the liability of partner is limited to the extent of their Capital Contribution.Correct answer is option 'B'. Can you explain this answer? for CA Foundation 2024 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about Which one of the following statements is true.a)In a partnership, every partner is not an agent of the other partners.b)A partnership firm has no Legal personality distinct from its partners.c)In a partnership, the profits of the firm should be distributed equally among all partners.d)In a partnership, the liability of partner is limited to the extent of their Capital Contribution.Correct answer is option 'B'. Can you explain this answer? covers all topics & solutions for CA Foundation 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Which one of the following statements is true.a)In a partnership, every partner is not an agent of the other partners.b)A partnership firm has no Legal personality distinct from its partners.c)In a partnership, the profits of the firm should be distributed equally among all partners.d)In a partnership, the liability of partner is limited to the extent of their Capital Contribution.Correct answer is option 'B'. Can you explain this answer?.
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