Dissolution of Partnership Firm Class 12 | Maharashtra Board New Syllabus
DISSOLUTION OF PARTNERSHIP FIRM
The term dissolution means coming to an end or discontinuation. The dissolution of the firm implies a complete breakdown of the partnership relation among all the partners.
The dissolution of a partnership among all partners of a firm is called the dissolution of the firm.
(i) Dissolution by Agreement: A firm is dissolved in case
- all the partners give consent or
- as per the terms of the partnership agreement.
(ii) Compulsory dissolution: A firm is dissolved compulsorily in the following cases
- When all the partners or all excepting one partner become insolvent or of unsound mind.
- The business becomes unlawful.
- When all the partners except one decided to retire from the firm.
- When all the partners or all except one partner die.
- A firm is also dissolved compulsorily if the partnership deed includes any
- Provision regarding the happening of the following events: (a) expiry of the period for which the firm was formed, (b) completion of the specific venture or project for which the firm was formed.
(iii) Dissolution by Notice: In case of a partnership at will, the firm may be dissolved if any one of the partners gives a notice in writing to the other partners.
(iv) Dissolution by Court: A court may order a partnership firm to be dissolved in the following cases:
(a) When a partner becomes of unsound mind
(b) When a partner becomes permanently incapable of performing his/her duties as a partner.
(c) When a partner deliberately and consistently commits a breach of agreements relating to the management of the firm.
(d) When a partner’s conduct is likely to affect the business of the firm adversely.
Dissolution of Partnership firm Class 12 New Syllabus (Videos)
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