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CSEET · Fundamentals of Accounting · Partnership and LLP Accounts

P, Q and R share profits in the ratio 2:2:1. R dies and the partnership continues. Under Section 35 of the Indian Partnership Act, 1932, where the firm is not dissolved by the death of a partner under a contract between the partners, the estate of the deceased partner is:

The estate of the deceased partner is not liable for any act of the firm done after his death, where the partners' contract provides that the firm is not dissolved by death. The section contains no time limit or capital-based liability.

  1. ANot liable for any act of the firm done after his deathCorrect
  2. BLiable for all acts of the firm done after his death up to his capital
  3. CLiable for acts of the firm for one year after death
  4. DLiable only if the firm continues to use his name

Explanation

Section 35 states that where under a contract between the partners the firm is not dissolved by the death of a partner, the estate of the deceased partner is not liable for any act of the firm done after his death. Other options add conditions not in the section.

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