DEED OF PARTNERSHIP BETWEEN TWO PARTNERS
This deed of partnership is made this............day of......20…….between ........................... son of.........residing at.........of the one part and........................ son of......... residing at.........of the other part.
This deed witnesseth and the parties hereby agree as follows:
1. The parties hereto shall carry on business in co-partnership as manufacturer and trader of jute goods under the name and style of ..................................Brothers at.........with effect from............until the expiration of .....................months' notice in writing to determine the partnership left by either party for the other at the place of business of the firm, at any time after the............day of............subject to the terms and conditions hereunder contained and subject to such change in the constitution of the firm, if any, hereafter effected by addition, withdrawal, retirement or expulsion of partner or partners.
2. Within.........days from the commencement of the business, the firm shall be registered both under the Indian Partnership Act as also under the Income Tax Act and the rules prescribed under both the statutes shall be applicable to the firm.
3. The name of the firm shall be "Eastern Law House" and the same may be changed hereafter into some other name as desired by the partners.
4. The business of the firm shall at present be carried on at........., etc., or such other place or places as the partners may hereafter from time to time determine.
5. The capital of the firm shall presently consist of a sum of Rs.......... to be contributed by the partners in equal shares, and shall be paid soon after the execution of these presents. Each partner shall be entitled to interest at the rate of.........% per annum on the capital standing to his credit in the books of the firm to be paid at the first instance out of the gross profits except when the firm suffers any loss, such interest being cumulative the deficiency for one year will be made up out of the profits for the succeeding year or years.
6. If any partner is made to advance any further money or moneys over and above the proportion of capital agreed to be contributed by him to meet emergent expenses on behalf of the firm or shall choose to leave his share of net profits undrawn at any annual general accounting, he will also be entitled to interest thereon at the rate of.........% per annum unless required by the other partner or partners to withdraw the same in which event the interest shall cease to accrue.
7. All outgoings and expenses of the firm shall be paid out of the capital and profits of the business and, in case of deficiency, by the partners in equal shares.
8. The bankers of the firm shall be Messrs................, etc., or such other bankers as the partners shall from time to time mutually agree upon, and all moneys, cheques and other securities belonging to the firm, except those required for current expenses, shall be paid into or deposited with the said bank.
9. All cheques drawn for amounts exceeding Rs............. bills and other documents for the purposes of the firm shall be signed by both the partners; each partner shall have the authority to sign all other cheques individually in the name of the firm.
10. The profits and losses shall belong to and be borne by the partners in equal shares.
11. In the event of any increase in the capital agreed upon by the majority or unanimously by the partners such additional capital unless otherwise agreed, shall be contributed by equal shares.
12. Partners may draw out in advance such sum or sums not exceeding Rs..........in each month as may be agreed but, if on taking general accounts in any year, it appears that either partner has drawn more than his share of profits for that year, he shall refund the excess at once.
13. Both the partners shall attend diligently to the business of the partnership and carry on the same for the greatest advantage of the partners; and neither of them shall be, directly or indirectly, engaged or interested in any trade or business except that of the partnership.
14. Partners shall punctually pay and discharge their separate debts and liabilities, and shall indemnify and keep indemnified the firm effectually against the same.
15. No partner shall, without the consent in writing of the other partner or partners for the time being, release or compound any claim or debt due or owing to the firm or otherwise compound or settle the same or diminish any security without receiving the full amount thereof, or lend any money or deliver on credit goods belonging to, or otherwise give credit on behalf of, the firm other than in the usual course of the business of the firm, or contract debts and liabilities exceeding Rs..........or institute suits or proceedings or make himself liable as surety for any person, or sell, transfer or assign or otherwise deal with either absolutely or by way of mortgage or declaration of trust, his share or interest in the firm, or the profits and/or benefits thereof except in favor of another partner or do, execute or perform or suffer to the contrary any act, deed or thing whereby the property of the firm may be exposed to the danger of being seized, attached or taken in execution, when and in such an event he shall be liable to be expelled from the partnership, if so decided by the then majority of partners, who may in the alternative file a suit for dissolution of the firm with all consequential reliefs.
16. The partners shall keep and maintain proper books of account. The books of account securities, vouchers, etc. shall be kept at the place of the business and be open to the inspection of each partner or his agent at all reasonable times with power to take copies.
17. On the ......... day of......... and on that day of every succeeding year, during the continuance of the partnership, a general account of the preceding year shall be taken and a just valuation made of all the assets and liabilities of the firm; such general account shall be audited by such registered accountant as the partners shall from time to time mutually appoint, and shall be entered in a book and signed by both the partners, and when so signed, the entries in such book shall be binding on both, provided that, if within-months from the date of the signing of the book any manifest error shall be found therein, such error, shall be rectified. All profits (after setting apart an amount equivalent to ......... % thereof as Reserve Fund to meet emergent expenses) and loss shall be divided as aforesaid after such signature.
18. The firm shall not stand dissolved upon the death, retirement or insolvency of any partner, but upon dissolution in other cases it shall be wound up and the assets and liabilities dealt with in accordance with the provisions of the Indian Partnership Act.
19. If any partner infringes any one of the clauses hereunder or becomes insane, or is adjudicated an insolvent, the other partner may forthwith determine the partnership by notice in writing, and may thenceforth continue the business alone and may publish notice of the dissolution in the local Official Gazette and in local vernacular newspaper, and also inform the Registrar of Firms in writing.
20. Upon the dissolution of the firm either by death of a partner or by notice under cl. (19) the other partner may purchase his shares in the effects at a valuation to be made by arbitrators or their umpire as hereinafter mentioned. The price, when ascertained, shall be paid by three (or etc.) equal installments at the end of four, eight and twelve calendar months (or, etc.), from such date of the award by the continuing partner or purchaser, who shall also execute all deeds and things necessary for indemnifying the outgoing partner or his estate from all the liabilities of the firm; and the outgoing partner or his representatives shall execute all such deeds and documents and do all acts necessary for effectually vesting in the purchaser the share purchased, including the goodwill, and the outgoing partner shall not carry on, or be engaged in any business competing with or interfering with the business of the firm, within a radius of.........miles of, etc., during the remainder of the term of the said partnership term.
21. All notices required to be given to either partner hereunder shall be deemed to be duly served if addressed to such partner at the office of the firm and sent by registered post.
22. Any dispute or difference which may arise between the partners or their representatives, with regard to the construction, meaning and effect of this deed or any part thereof, or respecting the accounts, profits or losses of the business, or the rights and liabilities of the partners under this deed, or the dissolution or winding up of the business, or any other matter relating to the firm, shall be referred to arbitration and the decision of a sole arbitrator, if the parties in dispute so agree, otherwise to two or more arbitrators, according to the number of the partners of the firm one to be nominated by each party or his representative and in case of difference of opinion between them, by the umpire selected by them at the commencement of the reference and this clause shall be deemed to be a submission within the meaning of the Arbitration and Conciliation Act 1996 including its statutory modification and re-enactment.
In witness whereof the parties hereto have executed these presents on the day, month and year first above-written.
Signed, sealed and delivered by ................................ in the presence of:
Signed, sealed and delivered by ....................................in the presence of: