Q.State any four essential features of a partnership, as they follow from Section 4 of the Indian Partnership Act, 1932.

Section 4's definition itself yields the essential features once broken down: association of persons, an agreement, a business, and mutual agency being the decisive test.

Any four of the five features drawn from Section 4 would be accepted; the answer below states four with a short explanation of each.

Section 4 of the Indian Partnership Act, 1932 defines partnership as 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. Breaking this definition down yields the following essential features, any four of which fully answer the question:

1. Association of two or more persons — a partnership needs at least two people; the Companies Act, 2013 further caps the number at 50.
2. Agreement — the relationship must arise from a contract, not from status (Section 5); this rules out, for example, a Joint Hindu Family business.
3. Existence of a business — the parties must be carrying on an actual, lawful trade, occupation, or profession, not merely a one-off transaction or a charitable purpose.
4. Sharing of profits — the partners must have agreed to share the profits earned by the business.
5. Mutual agency — the decisive legal test (Section 6): each partner must be capable of acting as an agent for, and binding, all the others, and equally being bound by what the others do in the firm's business.