Q.In the absence of a partnership deed, what interest on CAPITAL (not on a partner's loan) is a partner entitled to, under the Indian Partnership Act, 1932?
(A) 6% per annum
(B) 12% per annum
(C) No interest on capital is allowed, unless the deed expressly provides for it
(D) Interest at the bank rate prevailing during the year

The default rule for interest on CAPITAL is different from the default rule for interest on a partner's LOAN to the firm — this question is testing the capital rule specifically. …

Why (C) is correct: Section 13 of the Indian Partnership Act, 1932 does not entitle a partner to any interest on his CAPITAL contribution unless the partnership deed expressly provides for it — capital is the partner's own investment in the business, and by default earns him only his agreed share of profit, not separate interest.

Why the distractors are wrong: …

Students frequently answer '6%' here because they recall SOME 6% default rule from this chapter — but that 6% rate applies only to a partner's LOAN to the firm, not to his CAPITAL. Interest on capital is n …