As per the Partnership Act, 1932 "Partnership" is defined under:

Correct option is D

The correct answer is: (d) Section 4

Explanation:

Section 4 of the Indian Partnership Act, 1932 provides the legal definition of a partnership: "Partnership is the relation between persons who have agreed to share the profits of a business carried on by all or any of them acting for all."

• Individuals who enter into a partnership are called partners.

• Collectively, they form a firm, and the business is carried on under the firm name.

• The essence of partnership is the agreement to share profits of a business.

Information Booster:

• Key Elements of Partnership under Section 4:

  1. Agreement between persons: A contract is necessary; it cannot be created by mere status.

  2. Sharing of profits: The agreement must involve profit-sharing.

  3. Business carried on by all or any acting for all: Each partner may act on behalf of all partners.

  4. Formation of a firm and firm name: Legal recognition of the collective entity.

• Importance: Section 4 is foundational as it distinguishes partnership from other business relationships and ensures clarity about the roles and rights of partners.

Additional Knowledge:

• Section 5 – Partnership not created by status:

  • Partnership arises from contract, not from status.

  • Members of a Hindu Undivided Family (HUF) or Burmese Buddhist husband and wife do not automatically become partners.

• Section 7 – Partnership at will:

  • Governs partnerships without a fixed duration or termination clause.

• Section 8 – Particular partnership:

  • Covers partnerships for specific ventures or undertakings rather than ongoing business.