Partnership Agreement (India)
This is a standard template for a Deed of Partnership in India, designed to establish or amend a partnership business involving multiple individuals. It covers essential aspects including capital investment, profit and loss distribution, interest on capital, and remuneration for working partners according to Indian income tax laws. The template also includes provisions for dispute resolution through arbitration and clarifies the roles of active versus dormant partners.
PARTNERSHIP AGREEMENT
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About this template
What is this template?
This document is a formal partnership deed governed by the Indian Partnership Act 1932. It establishes the firm's name, the specific capital contributions of each partner, and the precise ratios for sharing profits and losses. It is not a Limited Liability Partnership (LLP) agreement and does not provide limited liability protection to the partners.
When should you use it?
Use this template when starting a traditional partnership business in India where partners have unlimited liability. If you require a corporate structure with limited liability, use an LLP Agreement or Articles of Association for a Private Limited Company instead.
What's inside
| Clause | Name | What it does |
|---|---|---|
| 3 | Place of Business | Designates the principal place of business and allows partners to agree on other locations for partnership activities. |
| 5 | Capital of the Firm | Specifies the initial capital amount provided by each partner and prohibits interest payments on these capital contributions. |
| 6 | Profit Sharing Ratio | Defines the specific percentage of net profits and losses to be apportioned to each named partner. |
| 8 | Management | Grants all partners the right to participate in management while requiring mutual consent for certain key business decisions. |
| 12 | Termination and Dissolution | Outlines the process for ending the partnership, including the settlement of accounts and distribution of remaining assets. |
| 14 | Arbitration | Mandates that disputes be settled via arbitration under the Indian Arbitration and Conciliation Act 1996. |
Who it's for
- individuals in India intending to carry on a business in common for profit
- business partners requiring a formal profit-sharing structure under the Indian Partnership Act 1932
- small business owners in India formalizing a long-term commercial association
How long it runs and how it's signed
Law it's drafted under
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