Partnership Deed:

Partnership is the result of an agreement. The Agreement can be oral or written but the written agreement among the partners is known as partnership deed.

Content of partnership Deed

1. The name and address of the firm
2. Name and address of the partners.
3. Nature of business.
4. Profit sharing ratio
5. Capital contribution
6. Interest on capital
7. Drawings
8. Interest on drawing
9. Method of recording of firm’s accounts
10. Salary, Commission
11. Auditing of accounts
12. Methods of maintaining partner’s capital accounts
13. Settlement of disputes
14. Use the decision under Garner v/s Murray Rule

Rules Applicable in Absence of partnership Deed

1. Profits are to be shared equally.
2. No interest on capital shall be allowed to the partners.
3. No interest is to be charged on drawings.
4. No partner is entitled to any salary or commission for taking part in running the firm’s business.
5. Interest @ 6% p.a. is to be allowed on a partner’s loan to the firm.
6. Each partner can participate in the conduct of business.
7. Each partner can inspect the books of firm and can take a copy of the same.

Importance of partnership deed

1. It governs the rights and duties and liabilities of each partner.
2. Disputes arising, if any among the partners are settled on the basis of partnership deed, it being a written Agreement.