Explain the rights and duties of partners. |
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| Ans : The rights and duties of partners are explained below:
A. Right of Partners
:- Generally, right of partners are determined in partnership deed. In the absence of any contract or deed of partnership, the following are the rights of partners:
i) Right to manage business:- Every partner has right to take active part in the management of the business. In the absence of agreement, partner is not entitled to any remuneration or other financial incentives for the service.
ii) Right to express views:- In partnership, every partners has right to express his opinion, gives advices and view on any subject.
iii) Right to inspect books of account:- Every partners has a right to inspect financial transactions of the firm. He may have right to take a copy of statements of account if he thinks necessary.
iv) Right to share profit:- Every partner has right to share profits of the firm. Partners share profit of the firm on the basis of agreement or capital investment.
v) Right to proper use of property:- Every partner has right to use the properties of the firm for the benefit of the firm. A partner cannot use the property of the firm for personal use.
vi) Right to prevent admission of new partners:- A new partner cannot be admitted in the firm without mutual consent of all the partners. Thus, each partner has right to prevent admission of any new partner in the firm.
vii) Right to get retirement:- Each partner has right to get retirement from the partnership business when he faces any personal problems or difficulties. Generally, mutual consent of all the partners is required for getting a partners retirement from the business.
viii) Right to dissolve:- A partner has right to dissolve the partnership firm with the consent of all other partners of the firm.
B. Duties and Responsibility of Partners
:- Duties are the responsibilities that every partners has to fulfill for smooth performance of partnership business. Some duties of partners towards firm are as follow:
i) Mutual confidence and understanding:- As the partnership start with an agreement between the partners, it is the duty of the partners not to break confidence, agreement and understanding between the partners.
ii) To share losses:- All the partners are required to share loss from business on the basis of their capital investment.
iii) Not to transfer interest:- It is the duty of partner not to transfer his/her partnership interest to any person without consent of existing partners.
iv) To act within the scope of authority:- No partnership is allowed to work beyond his/her authority. It is the responsibilities of the partner to perform within his authority.
v) Not to demand remuneration:- Even the active partner is not authorized to the demand remuneration if it is not mentioned in partnership deed.
vi) To identify the business:- The partner is required to compensate loss of the firm that has occurred in business because of partners negligent and carelessness.
vii) Not to run competitive business:- It is the responsibility of a partner not to run similar nature of competitive business, which may provide negative impact to the firm.
viii) To maintain up to date account:- It is the duty of partner to maintain up to date and true books of account. It is essential to know about the progress and position of business activities of the firm.
ix) Not to use property of the firm:- It is the responsibility of partners not to use property of the firm for personal uses. The property of the firm should be used only for progress and prosperity of the firm.
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