The partnership is a relation between the persons that arises from the contract and this contract may be terminated at the expiry of the period or the will of the partners. How to draft the partnership deed and which information is required to create the draft. The following content provides you the particular guideline to create the draft of the deed. The facts, terms & conditions may be variable in every case but the standard format of the deed will almost be the same. The partnership deed is a basic instrument for the formation of the firm.
This deed of partnership is made at ———— on this day of ——————-by and between the following partners: –
- Name, father name, and address of the party (hereinafter called party of the 1st part).
- Name, father name, and address of the party, (hereinafter called party of the 2nd part).
(The term parties of all parts include their legal heirs, executors, administrators, and assignees).
Whereas parties hereof have pooled their resources and discussed the terms and conditions to form and constitute a partnership firm for their mutual benefits.
And further, whereas all the terms and conditions have been discussed by all the partners and agreed upon and these are required to be reduced to writing to keep the matter clear, free of doubts and ambiguity, and for such uses and references as they need may be from time to time. Hence this deed has been drawn up.
NOW, THIS INSTRUMENT OF PARTNERSHIP WITNESSETH AND CONFIRMETH AS UNDER;-
That the Firm shall run under the name and style “Name of the firm if any”.
(Clearly define the principal line of business of the firm)
- That the Head office of the firm shall be at the office (mention the address of the office). However other branches can be opened/closed at any other place/place with the mutual consent of the parties. The head office of the firm can also be shifted to any other place by the consent of the parties.
- That the Account of the firm will be opened in any scheduled Bank and will be operated under the joint signatures of any two parts.
- That the investment cum working capital for the smooth flow of AOP/Firm shall be arranged by the partners from their own sources.
- That the nature of the business of the firm shall be to provide services to any party/ organization regarding services or any other business which is lawful and agreed upon by the partners of the partnership.
- That irrespective of the capital investment of the partners, profits, and losses of the firm will be shared as under:
Party of the 1st part.
Party of the 2nd part.
- That Partnership is ‘AT-WILL’ of the parties.
- That the Firm shall be liable to pay its own taxes and the partners shall be liable to pay their own individual taxes and liabilities.
- That books of Accounts shall be maintained and the first set of books will be closed on the 30th day of the 6th month of every year and thereafter on the same day of every year.
- That with the consent of the parties the authorized part can sign and negotiate on behalf of the firm with any other party or government organization for the promotion and running the business of the firm.
- That in case of death of any partner or becoming unable to perform the Firm shall stand dissolved but the share of a deceased partner shall go to his own legal heirs.
- That the parties hereto reserve the right to change, amend, alter, or add any clause in this deed of partnership with their mutual consent.
- That the profit and losses shall be divided between the parties at the end of every financial year.
- That the partners shall have the right to inspect and check all the books of accounts maintained by the firm.
- That if any difference or dispute arises between the parties, the matter shall be referred to arbitration in accordance with the law.
- That this deed of the partnership shall take effect from the date of its execution.
- That no new partner shall be allowed to be entered into this partnership without the written consent of all the parties.
- That all the provisions of the Partnership Act 1932 shall apply to this firm in letter and spirit.
- That the duration of the Firm business shall be at-will and any of the partners desirous of dissolving the partnership shall serve the other parties with a notice of one month of his wish to retire and on expiry of which he/she shall cease to be a partner in the Firm and his/her share shall be paid out by the other partners by adding profit or by deducting loss, expenses, taxes, etc.
- That the Firm can be converted into a private limited company at any time with the mutual consent of all the parties.
- That all the policy matters will only be decided with the mutual consent of all the parties.
In witness whereof, the parties hereto have set and subscribed their hands hereunder at Lahore in this day of (year).
(Party of the 1st Part) (Party of the 2nd Part)
1.______________ 2. ________________
There can be more than two partners in a partnership and the terms and conditions may also be from the above draft as per the consent of the partners. The signatures and thumb impressions of all the partners must be put on the deed, there should also be two witnesses required to sign the partnership deed under the Partnership Act, 1932. This article is carrying a complete format and content that how to file a partnership deed.