Partnership- Advantages and Disadvantages, Important points in drafting partnership deed and Step wise online registration process of partnership in Maharashtra from April 2020
Introduction
A partnership is a relation between two or more person who agree to share profits from a business which will be run by them or by one or more persons acting for them all. The Partnership in India is governed by the Indian Partnership Act, 1932. A written Partnership Agreement is called a Partnership Deed. Any individual who is competent to enter into a contract, can become a partner in a partnership firm. Initially the partnership process was extremely lengthy and time consuming. In order to ease the process the Registrar of firms has made the process online from November 2017. Post online registration the physical submission of documents is to be done in the respective Partnership office. Further, the process is also made online so that the records can be maintained and the documents are not misplaced as was the case earlier.
Advantages and Disadvantages of Partnership
Advantages
- Easy to Form
- Faster decision making
- Facilitates a sense of ownership
- More partners can raise funds easily
- Sharing of Risk
- Better Management
- Flexibility in Operation
- Less compliance
- Single level of taxation
- Confidentiality and secrecy is enabled
- Easy to dissolve
Disadvantages
- Unlimited Liability
- Limited Capital as upper limit of Maximum members in partnership
- Dissolution if partner dies
- Divided Authority
- Disagreements and disputes can occur
- Non- transferability of shares
- No legal Status
- Binding Partnership- One partner can act on behalf of the other
- Difficult to withdraw investments
- Dependency for decision making
Important points to Note while drafting a Partnership Deed
- The Deed will being with the date on which the agreement is executed
- Name and address of the firm and of the respective partners
- Business to be carried is to be specifically mentioned
- Business commencement Date
- Duration of Partnership- Usually mentioned as, “ AT WILL”
- Contribution of Capital by each partner
- Partners profit sharing ration
- Accounting period of the firm
- Rate of interest on Capital, Loans, Drawings etc of partners
- Method to be adopted for accounts of the firm
- Mode of appointment of Auditor
- Clause regarding opening of bank account and its operations- also specify the authorised signatory
- Duties, Powers, Responsibilities, Rights and Liabilities each of partners to be specified
- Salaries/ commissions paid to partners
- Mode in which accounts are to be settled if firm gets dissolved
- Adoption of method for settling disputes between partners- E.g. arbitration under the Indian Arbitration Act, 1940 or any other method as is mutually agreed
- Clause on admission/ retirement and death of partner
- Clause regarding credit facility to be availed by any financial institution
- Dissolution/ Winding up clause
- The Deed is to be signed by all partners along with 2 witnesses
It is to be noted that the Deed is drafted with clarity, is specific and to the point, does not cover unnecessary clause so as to avoid confusion and is free from any ambiguity.
Documents required to be kept ready before online registration
- Partnership Deed (Both in English and Marathi)
- Covering Letter (With Rs. 5 Stamp Fee signed by all partners)
- Blank Stamp Paper (Rs. 100 in the name of partnership or any 1 partner name)- Note if it is in the name of partnership than partnership stamp is required while taking blank stamp paper
- Authority Letter if registration is done by any other professional on behalf of the partners (All partners signature is required)
- Any other document which may be relevant/ required
Registered office where submission is to be done
| Place /Area | Office Address for Submission |
| Mumbai, Mumbai(Suburban),Thane,Ratnagiri, Raigad,Sindhudurga | Registrar of firms, Maharashtra State, Mumbai. New Administrative Building, 6th Floor, Near Chetna College, Govt. Colony, Bandra (East), Mumbai- 400 051. Ph No. 022-26551149 & 022-20860591. |
| Pune,Satara,Sangli,Kolhapur,Solapur, Ahmednagar | Assistant Registrar of Firms, Pune. Survey No. 47/30, Saraswati Parvati Bhavan, 2nd Floor, Behind Lokesh Hotel, Arnyeshwar Corner, Pune Satara Road, Pune-411 009. Ph. No. 020-24221898 |
| Nagpur, Amravati, Buldhana, Akola, Washim, Yavatmal, Chandrapur, Gadchiroli, Gondiya, Bhandara, Wardha | Assistant Registrar of Firms, Nagpur. 118, Old Sachivalay Building, Civil Lines, Nagpur-440 001. Ph. No. 0712-2530897 |
| Aurangabad, Jalna, Hingoli, Beed, Parbhani, Nanded, Osmanabad, Latur, Nashik, Dhule, Jalgaon, Nandurbar | Assistant Registrar of Firm, Aurangabad Office No 101, Siddharth Arcade, Vedant Nagar , In front of M.T.D.C. Holiday Camp, Station Road, Aurangabad 431 005. Pho. No. 0240 2970498 |
Step wise process for online partnership registration
(Note: For New Registration select Form A)
Step 1: Login to https://rof.mahaonline.gov.in/ and click on New Registration
Step 2: The New user registration page will appear- this page will enable you to create you unique user id and password – This page also requires you to enter your User profile details, your contact details ( mobile and email id), correspondence address and user account management ( user id, password and secret question)
Note: ( It is to be noted that this unique user id and password helps you to create your profile and the contact details enable you to receive mails from partnership department for acknowledgment and further correspondence)
Step3: After submission a activation link will be mailed on your registered email id- click on the link to complete process for login registration. Further Login with your Respective Login and password which you had created while registering and Select “Form A” under My Applications from Dashboard and fill in the required information. The form is divided into broadly 4 parts on page 1 i.e.
Part 1- Firm Details (consist of office where submission will be done, Firm name in English and Marathi and Nature of business in English and Marathi (Note Press Ctrl+ Y) in order to open floating keyboard as is mentioned in the English and Marathi Partnership Deed (Note: While entering Firm name Do not write followings titles before the name a. Messers, b. M/S, c. Indian, d. Inc., e. Association, f. Incorporation, g. .org, .In, .com, or h. Society
Part 2- Principal place of business of the firm as per English partnership deed
Part 3- Principal place of business of the firm as per Marathi partnership deed also select the duration as, “ AT WILL”
Part 4- Name/ Address of any other place where the firm carries business in the above name (in case more than 1 additional place you can select Add branch and add the additional place of business as well)
Once all details are filled select Next
Step 4: After clicking on next Page 2 will ask for Partner Details- Which will include if partner is an individual or not, Once you “select No” you will enter the other details like Name and Address of partner and date of joining of the partner. Further the form will ask if the partner is a minor if not “select No” and click on “Add partner” tab to Add other partner details ( Note: All the partners as mentioned in the partnership deed are to be added here, Minimum 2 partners are required for partnership. Also if there are only 2 partners after adding the second partner Click on Add partner tab again so that the second partner details are saved)- Click on Next once all the the partner details are saved and added.
Step 5: Once the partners details are sucessfully saved Page 3 is where you are to upload the required documents (Choose file and click on upload- Note Upload documents as is applicable to your partnership)Certified True Copy of Partnership Deed (Certified by C.A. or Advocate)
a. Certified True Copy of Partnership Deed (Certified by C.A. or Advocate)
b. Certified True Copy of Marathi Translation of Partnership Deed (Certified by C.A. or Advocate)
c. Affidavite Copy license / CC of copy license
d. Authority letter signed by all partners if documents are submitted by C.A. or Advocate
e. If company is partner Certified True Copy of Memorandum of Articles and Resolution
f. If Trust is partner Certified True Copy of Trust Deed
g. If business required License from Government Department then Certified True Copy of License
h. Other Document
(Note : The documents are to be uploaded in pdf format and once the upload is successful you can view the document uploaded and if wrongly uploaded you can even delete the same and upload revise document)
Step 6: Once you upload the documenst select View Form A- Check all the details are correctly filled in the Draft Form A inacse of any changes make the same by clicking on “Modify Form A” tab and in case no changes “Proceed to Payment” tab
Step 7: Payment – There are 4 modes of payments once you click on the “Proceed to Payment” Tab you can select the one which you want and can proceed with the payment. The amount to be paid for Form A 1623 ( Registration fees = 1600 + Service charge= 20 + SGST= 1.80 + CGST= 1.80)- Click on Make payment
Step 8: Select the appropriate mode as is applicable to you from the 4 modes of payment
a. Wallet-1 % transaction fee shall be charged for any amount for Paytm
b. Net banking-
i. INR 3 (for all banks) for Paytm
ii. Rs. 5 for per transaction payment- ICICI Banks and (All Banks)
iii Rs. 5 for tarnsaction amount up to Rs. 500 or Rs 10 per tarnsaction for payment from 501 and above- Pay Govt India (All Banks)
c. Credit/ Debit Card-
i. Credit Card Payment – 0.90% per transaction for any amount or Debit Card Payment – no charges for transaction up to 2000 & 1% for transaction > 2000- Paytm/ Master card- All banks credit/ debit card, Card- Master/ Visa/ Rupay
ii. Credit Card Payment – 1% per transaction for any amount or Debit Card Payment – no charges for amount up to Rs 2000 and 1% for amount greater than Rs 2000.- HDFC and All banks credit/ debit card, Card- Master/ Visa/ Rupay
iii. Credit Card Payment – 1% per transaction for any amount or Debit Card Payment – no charges for amount up to Rs 2000 and 1% for amount greater than Rs 2000- Pay Govt credit/ debit card, Master/ Visa/ Rupay
iv. Credit/Debit Card Payment – 1.15% per transaction for any amount- ICICI and All Banks Credit/ Debit Card
d. IMPS-
i. Rs. 5 for transaction amount up to Rs. 5000
ii. Rs. 7 for transaction amount from Rs. 5,001 to Rs 25,000
iii. Rs. 8 for transaction amount from Rs. 25,001 to Rs 50,000
iv. Rs. 9 for transaction amount from Rs. 50,001 to Rs 1,00,000
(all the above are for Pay Govt India)
Step 9: Once payment is successfully done- Click my applications – Click on view link – Click on print button to download pdf and view pdf- Form A print out is to be taken on green ledger paper after which sign on=f all partners on all pages is mandatory. Further Form A is to be Notarised and uploaded. Click on My applications tab – Click on upload and successfully upload the Notarised Form A. The Notary public details like the registration No of notary public, and Name and address are to be entered after uploading the Form A.
Step 10 : Physical Submission- After uploading the Notarised document you are to submit the physical copies in the respective Regsitrar of firms office within 7 days from the day of the online submission, The follwing documents are to be submitted physically in the respective office
i. Covering letter along with ₹ 5/- Court Fee Stamp.
ii. Certified copy of Partnership Deed. Deed need not be attested. But if attested date of execution and date of signature of Notary should be same.
iii. Certified copy of Partnership Deed. Deed need not be attested. But if attested date of execution and date of signature of Notary should be same.
iv. Blank Stamp Paper of ₹ 100/-
v. True Copy of License if required or a Undertaking in Affidavit form on appropriate stamp paper.
vi. (Notice: If form A is modified kindly take out new print of full Form A and get fresh Attestation.)
vii. Also take a xerox copy of covering letter to take acknowledgment of the submission done.
viii. Copy of Online payment Receipt generated
ix. You are not required to upload Covering Letter, Authority Letter and Blank Stamp Paper
