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CMA Intermediate · Business Laws and Ethics · Indian Partnership Act, 1932

Under the Indian Partnership Act, 1932, in which of the following situations may a partner retire from the firm by giving written notice to all the other partners of his intention to retire?

A partner may retire by giving written notice to all other partners where the partnership is at will. In other cases retirement needs the consent of all the other partners or an express agreement between the partners. Registration of the firm does not give a notice right.

  1. AWhere the partnership is at willCorrect
  2. BWhere the partnership is for a fixed term and no partner consents
  3. CWhere the firm is registered, whatever its type
  4. DWhere the partnership agreement is silent on retirement and the firm is for a particular adventure

Explanation

Section 32(1) allows retirement with the consent of all other partners, under an express agreement, or, where the partnership is at will, by written notice to all the other partners. A fixed-term partnership needs consent or an express agreement. Registration of the firm does not create a right to retire by notice.

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