The registration of partnership is not compulsory under Indian Partnership Act. In England registration is, however, compulsory. In India there are certain privileges which are allowed to those firms which are registered. Partnership deeds protect the parties they cover in case of discord. They also offer opportunities to envision potential difficulties and proactively present solutions. A partnership deed should cover the division of work between partners, as well as how profits will be shared. Unregistered Partnership firms- disadvantages
Any of the partner cannot file suit against the firm or against other partner to enforce his rights.
The firm cannot file suit against any third party to claim loss or enforce its rights.
Even the 'right of set off' is not available to the firm (i.e. setting off dues between other Partnership Firms in India are governed by the Indian Partnership Act, 1932. As per Section 4 of the Indian Partnership Act:- When a partnership firm (under a firm name) enters into a contract of partnership with another partnership firm or individual, in that case, in the eyes of the law Indian Partnership Act,1932 governs all the partnership firms in India.Here is the procedure for partnership deed registration in India. Formation- Partnership registration can be done under the provisions of the partnership act. It came into existence with a legally enforced agreement in Section 18 of the Partnership Act, 1932 says "Subject to the provisions of this Act, a partner is the agent of the firm for the purpose of the business of the firm" 5) Oral or Written Agreements . The Partnership Act, 1932 nowhere mentions that the Partnership Agreement is to be in written or oral format. 1. All the partnership firms studied are registered under Partnership Act, 1932. (Table no.5.45) 2. 44% firms are liable to tax audit. (Table no.5.46) 3. As a business entity, the partnership firms earn profit by carrying on their busi