Dissolution of Partnership Firm

Sirs,

In absence of dissolution clause, if one/ two partner/s (out of 4 Partners) sends/ the notice of dissolution to other partners then my questions are -
1. Can other partners continue the same business under the same firm name and style?
2. Is that notice binding on other partners?
3. If other partners wish to continue, can this notice be used to retire the partner/s who sent the notice of dissolution?
4. If the notice is sent by two partners out of 4, can the remaining two continue?

Asked 9 years ago in Constitutional Law

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2 Answers

1)In the matter of P. Venkateswarlu v. Lakshmi Narshima Rao, AIR 2002 AP 62,

the court held that in case of dissolution of partnership, firm might be dissolved by any

partner giving notice in writing to all the other partners of his intentions to dissolve the

firm.

2) According to section 43 of the Indian Partnership Act, 1932:

1. “Where the partnership is at will the firm may be dissolved by any partner

giving notice to all the other partners of his intention to dissolve the firm.”

2. “The firm is dissolved as form the date mentioned in the notice as the date of

dissolution or, if no date is so mentioned, as from the date of communication of the

notice.”

3)The Supreme Court observed that under section 43(2), notice must contain the date from

which the firm will be dissolved

4)if no notice is issued section 43 of partnership act then partner can also move court seeking dissolution of firm and for taking of accounts under order 20 Rule 15 of CPC

5) in absence of dissolution clause provisions of the Act shall apply,

it cannot be said that a partner of the firm is not entitled to ask for dissolution of the firm

and that only course open him is to retire as provided by another clause in the deed