Prepared by Shiromani Associates – Chartered Accountants
A Partnership Firm is one of the most widely adopted business structures among entrepreneurs in India, especially during the initial stages of a business venture. Governed by the Indian Partnership Act, 1932, this structure requires a minimum of two individuals who agree to collaborate, contribute capital, and share the profits and responsibilities of the business.
Simple and cost-effective setup
Shared responsibility and decision-making
Flexibility in operations
Minimal regulatory compliance (compared to companies)
At Shiromani Associates, we guide you through the complete process of registering a partnership firm in a legally compliant and efficient manner.
While choosing a name for the partnership firm, the following rules must be adhered to:
The name should not be identical or similar to an existing firm or trademark.
It should not contain words like Crown, Emperor, Empire, or any term suggesting government patronage.
Ideally, the names of one or more partners should be part of the firm’s name.
The Partnership Deed is a legal document that outlines the rights, duties, and responsibilities of each partner. It typically includes:
Name and address of the firm and all partners
Nature and scope of business
Capital contribution by each partner
Profit and loss sharing ratio
Roles and duties of partners
Admission, retirement, and expulsion clauses
Dispute resolution mechanisms
Duration of the partnership, if applicable
Shiromani Associates offers customized deed drafting services to ensure all critical aspects are legally covered and mutually agreed upon.
To legally register the partnership:
An application must be filed with the Registrar of Firms (RoF) in the respective state.
This is done using Form 1, as prescribed under the Indian Partnership Act.
Supporting documents such as the partnership deed, ID proofs, address proof, and Digital Signature Certificate (DSC) may be required.
We assist in preparing and submitting the application, along with coordination with the RoF for hassle-free processing.
Upon verification and approval, the Registrar will issue a Certificate of Registration, confirming the legal existence of the partnership firm. This certificate allows the firm to commence operations and access benefits such as:
Legal recognition in contracts
Access to loans and credit facilities
Protection under the Partnership Act
Minimum Two Partners
A minimum of two partners is required. A maximum of 50 partners is permitted under Rule 10 of the Companies Rules, 2014.
Partnership Agreement
A legally binding Partnership Deed outlines all essential terms and conditions.
Lawful Purpose
The partnership must be formed for a lawful business activity. Charitable or non-profit ventures are not eligible.
Profit Sharing
Profits and losses are shared as per the ratio defined in the partnership deed.
Mutual Agency
Each partner acts both as a principal and an agent for the firm, with the authority to bind the firm through their actions.
Unlimited Liability
Partners are jointly and severally liable for the obligations of the firm.
Voluntary Registration
Although registration is not mandatory, a registered firm enjoys greater legal rights and protections.
Taxation Benefits
Partnership firms are taxed at a flat rate of 30% (plus applicable surcharge and cess), with additional benefits on business expenses and remuneration to partners.
Here is a list of standard documents needed to complete the registration:
Form 1 – Application for Registration of Partnership
Certified Copy of Partnership Deed
Affidavit confirming the accuracy of information provided
PAN Cards and Address Proof of all partners
Proof of Principal Place of Business – Ownership document or Rent/Lease Agreement
Any other state-specific document (if required)
At Shiromani Associates, we specialize in end-to-end Partnership Firm Registration and compliance services:
Tailored partnership deed drafting
Assistance with name selection and approval
End-to-end coordination with Registrar of Firms
Legal and financial advisory from expert CAs
Post-registration support and compliance services