Question 13 of 25
Q.A partnership is formed by ________.
(a) agreement
(b) relationship among persons
(c) the direction of government
(d) friendship
Puducherry TnboardTamil Nadu HSC First Year (DGE) Commerce Board 2020MCQ· 1mImportance★★★★★
52% · 13/25 Questions
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Start your 14-day free trial to unlock the full solution →The correct answer is (a) agreement. Partnership is the result of an agreement (contract) between persons, not of status, relationship or government direction.
Under the Indian Partnership Act, 1932, partnership is "the relation between persons who have agreed to share the profits of a business carried on by all or any of them acting for all." The key word is agreed:
- Partnership arises from an agreement — a voluntary contract among the partners. This may be oral or written (a written one is the Partnership Deed). Hence (a) is correct.
- It is not created merely by a relationship among persons — for example, members of a Hindu Undivided Family are related but that is not a partnership. …
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