Section 4 of The Indian Partnership Act 1932, defines the partnership as “the relation between persons who have agreed to share the profits of business carried on by all or any of them acting for all”.
There are basically two types of partnership firm:
1. Unregistered Partnership Firm
2. Registered Partnership Firm
In Unregistered Partnership Firm, you have to prepare the deed on stamp paper (as per the State Stamp Act) as per the required amount for which the calculation of the stamp duty is directly linked with the capital introduced in the partnership. After completing Notary process you can make application for PAN number. You can start your Business after getting your PAN card from Income Tax Authority.
In Registered Partnership Firm, after completion of all steps of unregistered partnership firm, one should get the deed registered with registrar of firm based on given rules and provisions under the act.
However, both types of firms are legal and you can run your business and can take all the required government registrations.
Hence, it is more recommendable to go for registered partnership firm to get the benefit in case of any dispute occurs between partners or with third person, a partner can file a case in the court of law against the firm or other partners or towards third person.
Let LegalWiz.in experts help you in registering the Partnership firm smoothly at a very affordable price.