The Partnership Deed

DEED OF PARTNERSHIP

THIS DEED OF PARTNERSHIP is made at [Place of signing the deed] on this [Day of signing the deed] day of [Month of signing the deed], [Year of signing the deed].

Between

1. [Partner 1: name], aged about [Partner 1: age (years)] years, son / daughter / wife of [Partner 1: father's, mother's or husband's name], resident of [Partner 1: residential address], holding Permanent Account Number [Partner 1: PAN] and Aadhaar ending [Partner 1: Aadhaar (last four digits)], hereinafter referred to as the “Party of the First Part”;

And

2. [Partner 2: name], aged about [Partner 2: age (years)] years, son / daughter / wife of [Partner 2: father's, mother's or husband's name], resident of [Partner 2: residential address], holding Permanent Account Number [Partner 2: PAN] and Aadhaar ending [Partner 2: Aadhaar (last four digits)], hereinafter referred to as the “Party of the Second Part”;

And

3. [Partner 3: name], aged about [Partner 3: age (years)] years, son / daughter / wife of [Partner 3: father's, mother's or husband's name], resident of [Partner 3: residential address], holding Permanent Account Number [Partner 3: PAN] and Aadhaar ending [Partner 3: Aadhaar (last four digits)], hereinafter referred to as the “Party of the Third Part”.

The Parties of the First, Second and Third Parts are hereinafter collectively referred to as the “Partners” and individually as a “Partner”, which expressions shall, unless repugnant to the context, include their respective heirs, executors, administrators, legal representatives and permitted assigns.

Whereas

A. The Partners have agreed to carry on in partnership the business of [description of the business, for example: manufacture and sale of [products]; wholesale and retail trading in [goods]] and such other business as may be mutually agreed between them from time to time.

B. The Partners have commenced the said business with effect from [date of actual commencement] and have agreed to reduce into writing the terms and conditions governing their partnership, with effect from the date of this Deed.

C. The Partners intend that the firm shall be registered with the Registrar of Firms, [State], under section 58 of the Indian Partnership Act 1932.

Now this deed witnesseth as follows

1. Name and style. The partnership business shall be carried on in the name and style of “[Name of the firm]” or in such other name or names as the Partners may from time to time mutually agree in writing (the “Firm”).

2. Principal place of business. The principal place of business of the Firm shall be at [full address of the principal place of business]. The Firm may open, shift or close such branch offices, godowns, works, depots or other places of business, within or outside the State of [State], as the Partners may mutually decide, and every such change shall be intimated to the Registrar of Firms, the jurisdictional Goods and Services Tax authority and the Firm’s bankers.

3. Business of the Firm. The business of the Firm shall be [description of the business], together with all activities incidental or ancillary thereto, including the purchase, import, manufacture, processing, packing, storage, distribution, marketing, sale and export of [goods]. The Partners may by unanimous agreement recorded in writing add any other line of business, and such addition shall be recorded by a supplementary deed. No Partner shall commit the Firm to any business other than that stated in this clause.

4. Commencement and duration. The partnership shall be deemed to have commenced on [date of actual commencement] and the terms of this Deed shall govern the relations of the Partners with effect from [the date of this Deed / [date]]. [Option A — partnership at will, which the firm prefers for a family trading firm] The partnership shall be a partnership at will, provided that any Partner desiring to dissolve the Firm shall give to every other Partner not less than three calendar months’ notice in writing of his intention to do so, and the Firm shall stand dissolved on the expiry of that notice. [Option B — fixed term] The partnership shall subsist for a fixed period of [Fixed term of the partnership (years)] years from [Start date of the fixed term] and shall thereafter continue as a partnership at will unless renewed in writing.

5. Capital. The initial capital of the Firm shall be Rs [Initial capital of the Firm (Rs)] (Rupees [Initial capital in words] only), contributed by the Partners in the amounts and in the manner set out in the Schedule written below. Further capital may be brought in by the Partners in such amounts and at such times as they may mutually agree in writing, and shall be credited to the respective capital accounts. No Partner shall withdraw any part of his capital without the written consent of all the other Partners.

6. Capital and current accounts. Separate capital accounts and current accounts shall be maintained for each Partner. The capital account shall be credited only with capital introduced and shall be debited only with capital withdrawn with consent. Interest on capital, remuneration, share of profit and loss, drawings and all other amounts shall be passed through the current account of the Partner concerned. A Partner may draw against his current account such sums as the Partners may mutually agree, and no Partner shall overdraw his current account without the written consent of the others; interest at [Interest on debit balance of current account (% a year)] per cent per annum shall be charged on any debit balance so arising.

7. Interest on capital. Interest shall be paid to each Partner on the balance standing to the credit of his capital account at the rate of twelve per cent (12%) simple per annum, or at such lower rate as the Partners may mutually agree in writing before the commencement of the relevant accounting year, computed on the monthly product basis. Such interest shall be treated as a charge against the profits of the Firm and shall be allowed whether or not the Firm has made a profit in the relevant year. No interest shall be payable on any debit balance in a capital account save as provided in clause 6. The rate of interest under this clause shall not in any year exceed the maximum rate allowable under section 40(b)(iv) of the Income-tax Act 1961 as in force in the relevant previous year, and shall stand reduced to that maximum if it is lower.