What are the legal rights of minor as a partner?

What are the legal rights of minor as a partner?


Sec 30(1) of partnership Acts 1932 provides that a person who is a minor according to the law to which he is subject may not be a partner in a firm, but, with the consent of all the partners, for the time being, he may be admitted to the benefits of partnership. Under sub-section 30 (2), a minor has a right to such share of the property and of the profits of the firm as may be agreed upon, and he may have access to and inspect and copy any of the accounts of the firm.

Thus, a minor cannot be a full pledged partner of a firm, as he is incompetent to enter into a valid contract in the eyes of law. The position of law is that minors who are admitted as partners are not personally liable for the losses suffered by the firm. In the other words, the minor’s share of property and the profits of the firm are liable for the acts of the firm, but the minor is not personally liable for the acts of the firm. A minor partner domiciled in India, after completion of 18 years of age attains majority and he has to decide whether to stay with the partnership or not. If he has not completely severed the partnership relation with the firm after attaining majority, he will not be discharged from personal liability for all the debts of the firm to the third parties.

A minor after attaining majority shall at any time within six months of his attaining majority or on his obtaining knowledge that he had been admitted to the benefits of partnership, whichever is later, may give a public notice that he has elected not to become a partner in the firm. He shall be deemed as full pledged partner of the firm if he fails to give such notice. The onus of proving that such person had no knowledge of that he had been admitted to the benefits of the partnership until a particular date after the expiry of six months of his attaining majority shall lie on the person asserting that fact.

Related articles

  1. Active, Sleeping partner & partners of different types
  2. Different Partnership models in business
  3. Legal aspects of partnership business
  4. Sharing of capital deficiency by the partners (Garner V/s. Murray rule)

 

No Comments

Leave a Reply

Your email address will not be published. Required fields are marked *


Comments

Latest Tweets

error: Content is protected !!