CMA Intermediate · Business Laws and Ethics · Indian Partnership Act, 1932
Under the Indian Partnership Act, 1932, the dissolution of partnership between all the partners of a firm is called:
The dissolution of partnership between all the partners of a firm is called the dissolution of the firm, as stated in Section 39. If only one partner leaves, the firm continues, so that is a change in constitution rather than a dissolution.
- ADissolution of the firmCorrect
- BRetirement of a partner
- CInsolvency of a partner
- DDissolution of the partnership at will
Explanation
Section 39 defines dissolution of the firm as the dissolution of partnership between all the partners. Retirement of one partner ends only that partner's relationship and does not end the firm. Dissolution at will is only one way in which a firm may be dissolved, not the definition.
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