The agreement of Partnership:

Correct option is D

The correct answer is (d) Can be Oral or Written. According to the Indian Partnership Act, 1932, a partnership arises from a contract between two or more persons who agree to share profits of a business carried on by all or any of them acting for all. The Act does not mandate that the partnership agreement must necessarily be in writing; it can be either oral or written. However, in practice, a written agreement—commonly known as the Partnership Deed—is strongly preferred to avoid disputes, as it clearly defines rights, duties, profit-sharing ratios, and other terms.
A written partnership deed is also useful for legal evidence and required for various registrations, bank accounts, and tax purposes, but legally, even an oral agreement constitutes a valid partnership.
Information Booster
1. A partnership is based on agreement, not on status—unlike HUF.
2. Written partnership deeds help in resolving disputes and are admissible in court.
3. Oral partnerships are valid but harder to prove legally.
4. Partnership deed generally includes capital contribution, profit-sharing ratio, and duties of partners.
5. Registration of a firm is optional in India, but registered firms enjoy more legal rights.