Under the Partnership Act, a minor who has been admitted to partnership when attains majority should adhere to the following :
The question asks to identify the incorrect statement regarding the actions of a minor, admitted to the benefits of a partnership, upon attaining majority, as per the Partnership Act.
Partnership Act Rules for Minors Turning Adults
According to Section 30 of the Indian Partnership Act, 1932:
- A minor can be admitted to the benefits of an existing partnership.
- Upon attaining majority, the minor must decide whether to become or not to become a partner.
- They must give a public notice of their decision within six months of attaining majority or the date on which they obtain knowledge of their admission to the partnership, whichever date is later.
Analysis of Options
- Option 1: Requires issuing a public notice about becoming or not becoming a partner. This aligns with the Act.
- Option 2: States the option must be exercised within 2 months. The Act specifies six months. Therefore, this statement is incorrect.
- Option 3: If the minor opts to become a partner, their rights and liabilities as a minor continue until they actually become a partner. This is correct.
- Option 4: If the minor opts not to become a partner, their rights and liabilities as a minor continue up to the date they give notice of their decision. This is correct.
Conclusion
The incorrect statement is Option 2 because the timeframe allowed for a minor to exercise their option after attaining majority is six months, not two months.
Important Questions from Indian Partnership Act, 1932
- As per Section 206 AA in Income tax Act, 1961, if PAN (Permanent Account Number) is not provided, the rate of TDS would be __________.
- Which one of the following is not within the scope of Implied Authority of a partner?
- Match List - I with List - II and select the correct answer using the code given below :
List - I List - II (a) Mutual Rights and Liabilities of Partners (i) Section 34 of Partnership Act (b) Dissolution of Partnership (ii) Section 13 of Partnership Act (c) Retirement of a Partner (iii) Section 39 of Partnership Act (d) Insolvency of a Partner (iv) Section 32 of Partnership Act
Code : (a) (b) (c) (d) Under the Indian Partnership Act, 1932, which statements are false?
A. Partners have no duty to carry on business to the greatest common advantage.
B. In the absence of a contrary contract, interest on subscribed capital is payable even when there are no profits.
C. If the business continues using an outgoing partner’s share without final settlement, and no contrary contract applies, that partner may opt for attributable subsequent profits or 6% annual interest on the share, subject to section 37.
D. A majority may expel a partner without any contractual power and without acting in good faith.Which one of the following statements is True' in partnership?
