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Rights of Transferee or A Partner's Interest (S. 29) : Law of Contracts-II

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Shubham Phophalia

The document discusses Indian partnership law regarding the rights of a partner transferring their interest in the firm to a transferee, as well as the rights of minors admitted to the benefits of partnership. For a partner transferring their interest, the transferee is only entitled to the transferring partner's share of profits and cannot interfere in firm business. If the firm dissolves, the transferee can receive the transferring partner's share of assets. Minors admitted to partnership benefits have rights to an agreed share of profits and property but are not personally liable for firm acts. Within six months of turning adult, they can elect to become a full partner or not.

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Rights of Transferee or A Partner's Interest (S. 29) : Law of Contracts-II

Uploaded by

Shubham Phophalia
458 views5 pages
The document discusses Indian partnership law regarding the rights of a partner transferring their interest in the firm to a transferee, as well as the rights of minors admitted to the benefits of partnership. For a partner transferring their interest, the transferee is only entitled to the transferring partner's share of profits and cannot interfere in firm business. If the firm dissolves, the transferee can receive the transferring partner's share of assets. Minors admitted to partnership benefits have rights to an agreed share of profits and property but are not personally liable for firm acts. Within six months of turning adult, they can elect to become a full partner or not.

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42. Ss. 29 & 30 (Minor) IPA 1932

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The document discusses Indian partnership law regarding the rights of a partner transferring their interest in the firm to a transferee, as well as the rights of minors admitted to the benefits of partnership. For a partner transferring their interest, the transferee is only entitled to the transferring partner's share of profits and cannot interfere in firm business. If the firm dissolves, the transferee can receive the transferring partner's share of assets. Minors admitted to partnership benefits have rights to an agreed share of profits and property but are not personally liable for firm acts. Within six months of turning adult, they can elect to become a full partner or not.

Copyright:

© All Rights Reserved
Download as PPT, PDF, TXT or read online from Scribd
Download as ppt, pdf, or txt
458 views5 pages

Rights of Transferee or A Partner's Interest (S. 29) : Law of Contracts-II

Uploaded by

Shubham Phophalia
The document discusses Indian partnership law regarding the rights of a partner transferring their interest in the firm to a transferee, as well as the rights of minors admitted to the benefits of partnership. For a partner transferring their interest, the transferee is only entitled to the transferring partner's share of profits and cannot interfere in firm business. If the firm dissolves, the transferee can receive the transferring partner's share of assets. Minors admitted to partnership benefits have rights to an agreed share of profits and property but are not personally liable for firm acts. Within six months of turning adult, they can elect to become a full partner or not.

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Lecture-42

Law of Contracts-II
(Law of Partnership)
Rights of transferee or a partner’s interest (S. 29)
• (1) A transfer by a partner of his interest in the firm, either absolute
or by mortgage, or by the creation by him of a charge on such
interest, does not entitle the transferee, during the continuance of
the firm, to interfere in the conduct of the business, or to require
accounts, or to inspect the books of the firm, but entitles the
transferee only to receive the share of profits of the transferring
partner, and the transferee shall accept the account of profits agreed
to by the partners.
• (2) If the firm is dissolved or if the transferring partner ceases to be a
partner, the transferee is entitled as against the remaining partners
to receive the share of the assets of the firm to which the transferring
partner is entitled, and, for the purpose of ascertaining that share, to
an account as from the date of the dissolution.
 Murlidhar v CIT AIR 1967 SC 383.
Date: 23/09/2013 Slide-1
Lecture-42
Law of Contracts-II
(Law of Partnership)
Minors Admitted to the Benefits of Partnership (S. 30)

• (1) A person who is a minor according to the law to


which he is subject may not be a partner in a firm, but,
with the consent of all the partners for the time being,
he may be admitted to the benefits of partnership.
• (2) Such minor has a right to such share of the property
and of the profits of the firm as may be agreed upon,
and he may have access to and inspect and copy any of
the accounts of the firm.
• (3) Such minor’s share is liable for the acts of the firm,
but the minor is not personally liable for any such act.
Date: 23/09/2013 Slide-2
Lecture-42
Law of Contracts-II
(Law of Partnership)
• (4) Such minor may not sue the partners for an account or payment of his share of the
property or profits of the firm, save when severing his connection with the firm, and in such
case the amount of his share shall be determined by a valuation made as far as possible in
accordance with the rules contained in section 48:
– PROVIDED that all the partners acting together or any partner entitled to dissolve the
firm upon notice to other partners may elect in such suit to dissolve the firm, and
thereupon the court shall proceed with the suit as one for dissolution and for settling
accounts between the partners, and the amount of the share of the minor shall be
determined along with the shares of the partners.
• (5) At any time within six months of his attaining majority, or of his obtaining knowledge that
he had been admitted to the benefits of partnership, whichever date is later, such person
may give public notice that he has elected to become or that he has elected not to become a
partner in the firm, and such notice shall determine his position as regards the firm:
– PROVIDED that, if he fails to give such notice, he shall become a partner in the firm on
the expiry of the said six months.
• (6) Where any person has been admitted as a minor to the benefits of partnership in a firm,
the burden of proving the fact that such person had no knowledge of such admission until a
particular date after the expiry of six months of his attaining majority shall lie on the persons
asserting that fact.
Lecture-42
Law of Contracts-II
(Law of Partnership)
• (7) Where such person becomes a partner-
– (a) his rights and liabilities as a minor continue up to the date on which he
becomes a partner, but he also becomes personally liable to third parties
for all acts of the firm done since he was admitted to the benefits of
partnership, and
– (b) his share in the property and profits of the firm shall be the share to
which he was entitled as a minor.
• (8) Where such person elects not to become a partner,-
– (a) his rights and liabilities shall continue to be those of a minor under this
section up to the date on which he gives public notice,
– (b) his share shall not be liable for any acts of the firm done after the date
of the notice, and
– (c) he shall be entitled to sue the partners for his share of the property and
profits in accordance with sub-section (4).
• (9) Nothing in sub-sections (7) and (8) shall affect the provisions of
section 28.
Date: 23/09/2013 Slide-4
Lecture-42
Law of Contracts-II
(Law of Partnership)

 Lachhmi Narain v Beni Ram AIR 1931 All 327.


 Shivgauda v Chandrakant AIR 1965 SC 212.

Date: 23/09/2013 Slide-5

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