Liability of a passive partner if active partner in a partnership firm
26-Aug-2023 (In Corporate Law)
I have partnership firm. It is from last 1 year, but no transaction done. No account in any bank. I am passive partner. We have certificate that we have put in our office. My partner was doing his business but from his personal account. All transaction he done from his account only. My partner taken some loan individually from some people by giving his personal cheques only. He used name of the firm that we have this firm and running our business. But no document of sign. He taken loan based on his cheques he given to these person. Is there any liability on me? I got call from someone that we are filing a case with my partners cheques and mentioning that he was doing business with this firm. Please suggest
Either you are a passive or active partner you r a part of a firm even though your role is not on records but when someone files a case and make your firm as a party then liability comes to all the members of the firm even later on you can explain then detail of the facts which will in your favour but these procedings will take u as a party for the member of the firm not individually its not going to affect u much.
Respected Mr.(1)according to the Income Tax Act for a partnership business under Partnership Act partnership deed must be drawn between all the partners (2) there are two types of partners a. Active partner b. Passive partner, passive partner is under no liability to pay the dues of the firm and personal debts of the partner for further clarification please contact.
It depends on the partnership agreement executed between you and your partner. Being a passive partner, you have just contributed in capital of partnership and getting interest on it. Then, your liability cannot be more than your contribution.
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