Rustum, Mahmood and Wali are partners in a firm. Wali wants to admit his sixteen year...

Rustum, Mahmood and Wali are partners in a firm. Wali wants to admit his sixteen year old son Raghib as a new partner. Under the provisions of the Partnership Act, 1932 can Raghib be admitted to the partnership business? State the rights, liabilities and limitations of Raghib, if he is admitted to the partnership business.

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The partnership is a contract between the partners. Hence a minor cannot be a partner in a partnership firm. Section 30 of the Indian Partnership Act, provides that though a minor cannot be a partner in a firm, with the consent of all the partners, for the time being, he may be admitted to the benefits of the partnership by an agreement executed through his guardian with the other partners.

When a minor is admitted to the benefits of a partnership, his rights and liabilities before attaining majority are as follows:

Right to share profits: A minor admitted to benefits of partnership has a right to receive his agreed share of the property and the profits of the firm.
Right to access to books of account: He has a right of access to accounts and to inspect and copy any of the accounts of the firm. However, this right is available for accounts only and not other books of the firm. Which may contain secrets for which minors can not be trusted.
Suit for share: A minor may sue the partners for an account or payment of his share of profits or property of the firm on leaving the firm. As long as he remains in the firm, he has no such right. if he wants to sue he should first leave the firm.
Liability of Minor: Minor’s share is liable for the acts of the firm but the minor is not personally liable for any such act. A minor being entitled to the benefits, it would be just and equitable that his share in the partnership assets should be held liable.

Hence Raghib cannot be a partner in a partnership firm. But with the consent of Rustum, Mahmood, and Wali he may be admitted to the benefits of the partnership by an agreement executed through his guardian with the other partners.

ekkarill92 answered 1 year ago

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