Partnership Deed should states that the partner can't indulge in to similar or competitive business. We need to see the partnership deed.

Feel free to reach out

Ideally one cant, but to give a concrete answer, one will have to peruse the clauses in your partnership deed

Hello,

No he can not do the same.

Send a notice to the partner and thereupon dissolve the partnership.

Also you can file the civil suit for recovery of the damages.

Regards

This would be breach of trust.

Any violation of the partnership firm's terms and conditions by any partner can be dealt with legally.

The law for stringent legal action against the lapses can be enforced.

1 Right of outgoing partner to carry on competing business: An outgoing partner can carrying on business competing with the firm and he may advertise such business, but without using the firm name or representing himself as carrying on the business of the firm or soliciting the custom of persons who were dealing with the firm before he ceased to be a partner (Section36(1))of the partnership act.

If a partner carries on business of the same nature as and competing with that of the firm, then he must account for and pay to the firm all profits made by him in the business and the firm is not liable for any loss(Section16(b))

For a layman, a partnership is an association of people who have common objectives and goals. Even a business owned or managed by two or more people is termed as partnership. The idea of a partnership or such collaboration is that every member or partner contributes something which helps achieve an aim and is beneficial to all the members. A member may contribute money, skill or labour which in turn makes it easier to achieve the common objective. Thus, partnership is an arrangement where people consent to work together and advance their mutual interests. For example, two doctors may decide to work together on the same case as partners and share the fees.

See if the partnership agreement it is agreed that no other business can be started then he cannot otherwise he can so you can read the terms of partnership agreement if agreement doesn't has such condition he can start the business.

Further if such partner does such act breach the partnership agreement then compensation can be claimed from him and the share in profit can be demanded from such business. further first send the legal notice if he fails to reply same suit can be filed.

Each partner must act in good faith toward the other partners and must not take any advantage over the other partners by misrepresentation or concealment. A partner cannot promote a competing business, and if he does so, he can be liable for any damages sustained by the partnership. If a partner breaches a duty to the partnership, an injured partner may recover damages from the partner who breached the duty. Send a legal notice to the partner.

hello

a firm can be started by a partner if there is no such bar in the partnership agreement. if there is a bar and the firm is a registered partnership firm then a show cause notice followed by an arbitration or a case can be filed against that erring partner.

regards

Partner cannotopen separate firm and carry on any other business in his name

2) if partner carried on any other business firm can claim damages against said partner

1. Refer to the partnership deed about such restrictions.

2. if the deed is specific that any of the partners can carry out similar trade separately then and then only it is possible.

3. if the deed is silent on this then the partner can not carry out another trade of similar nature. It is prohibited by the Partnership Act.

If there is no non compete clause in the agreement then there is no restriction on opening a same business as the partnership is doing but if there is none complete class in the partnership agreement then you will be liable to compensate the losses of partnership firm

Dear Client,

As per partnership act, Partner shall not carry on any business other than that of the firm while he is a partner and if he do so partner shall indemnify the firm for any loss caused to it by his fraud in the conduct of the business of the firm.

Remedy through civil suit.

B is liable to compensate firm for losses suffered by firm form supplying goods at lower price

2) in second instance opening of new showroom in his name was contrary to terms of partnership and partner can be sued for damages

Not only the clause is binding on partner but same also prevail in partnership act.

Involvement of B cannot discarded and he is willfully liable for cheating and fraud.

Remedies available under partnership act for both civil and criminal, - If any loss reached to firm by selling at low price than criminal case and civil suit for recovery of damage and closer of firms opened.

The agreement is between the partners only, the other partner opening anew showroom on his mother's name is not an illegal act.

He should not involved in the business in the name of his mother either directly or indirectly

There is nothing wrong in the other partner doing any other business on his name also.

The granite slabs are not branded sale

He should not use the name and logo or trademark of the partnership firm for his business.

He should not violate any condition of the existing partnership firm or the articles or association or memorandum of association

In both situations B violated the terms of the partnership agreement. You can file a case for damages against B. Also you can terminate or winding up the partnership with B.

A partner may not enter into competitive contracts or form outside businesses that compete with the partnership. Hence, each partner must perform acts that are in the best interest of the business. Each partner owes a duty of loyalty to the other partners by disclosing information that affects the operations of the business and the essential nature of the business. Partners also have a duty to keep pertinent information regarding partnership affairs confidential. Depending on the terms of the partnership agreement, other acts may result in a breach, including insolvency, criminal conviction, breach of professional conduct in the profession or other forms of misconduct that violate the partner’s fiduciary duties.

Dear Sir,

My answers are as follows:

If the partnership firm is run by two partners, can one of the partner start an other business firm(same business as the partnership firm) in his name or in the name of his family member ? If no then what are the legal steps that can be taken against such partner.

Ans: The act of other partner is detrimental to the growth of partnership as such, such activities are barred impliedly.

let me be more specific

A registered partner ship firm dealing with manufacturing and selling granite slabs has two member ''A'' and ''B'' as partners. The partnership deed states "neither of the partners shall be entitled to carry on or be associated directly or indirectly in any business identical with or similar to that of the partnership firm except with the prior written consent of the other partners."

Ans: The act of other partner is detrimental to the growth of partnership as such, such activities are barred impliedly.

instance 1.

The partner B opens a granite showroom in the name of his mother with out the knowledge of partner A and starts sending out materials from the partnership firm to the newly opened showroom in his mothers name at lower prices. and the partner A is blind to these dealings and thus incurs losses in the firm. is partner B legally culpable for this ? and since the new showroom is not in his name but of his mother.

Ans: The act of other partner is detrimental to the growth of partnership as such, such activities are barred impliedly.

instance 2.

partner B further opens a new showroom dealing with granite slabs in his own name even when he is still the partner of the partnership firm.

so can i know the consequences of both the above mentioned instances and legally can i go through with the civil suits for both the instances.

Ans: All those activities are against the interest of partnership firm.