Can a minor be partner in a firm? If so, discuss his position before attaining majority and after attaining majority?
Find the answer to the mains question of the Law of Partnership only on Legal Bites.
Question: Can a minor be partner in a firm? If so, discuss his position before attaining majority and after attaining majority? [Punj JS 2007]Find the answer to the mains question of the Law of Partnership only on Legal Bites. [Can a minor be partner in a firm? If so, discuss his position before attaining majority and after attaining majority?]AnswerAccording to the provisions of Indian Partnership Act, 1932, a minor cannot be a partner in a firm. Section 30 of the Act specifically states...
Question: Can a minor be partner in a firm? If so, discuss his position before attaining majority and after attaining majority? [Punj JS 2007]
Find the answer to the mains question of the Law of Partnership only on Legal Bites. [Can a minor be partner in a firm? If so, discuss his position before attaining majority and after attaining majority?]
Answer
According to the provisions of Indian Partnership Act, 1932, a minor cannot be a partner in a firm. Section 30 of the Act specifically states that a person who is a minor cannot become a partner in a partnership firm. Therefore, a minor's position before and after attaining a majority in relation to a partnership is as follows:
Position before attaining majority (minor):
Incapacity to be a Partner: A minor lacks the legal capacity to enter into a contract, including a partnership agreement. Consequently, they cannot contribute capital, participate in decision-making, or be personally liable for the firm's obligations.
Benefits and Rights: Despite the minor's incapacity to be a partner, the Act allows a minor to be admitted to the benefits of a partnership with the consent of all the partners. As a minor admitted to the benefits of partnership, they are entitled to receive their share of profits or property as agreed upon.
Position after attaining majority:
Option to continue or discontinue: Upon attaining majority, a person who was previously a minor admitted to the benefits of partnership has the option to either continue as a partner or withdraw from the partnership.
Liability for Pre-majority actions: If the former minor decides to continue as a partner after attaining majority, they become personally liable for all actions and obligations of the partnership that occurred during their minority.
Ratification or Repudiation: The former minor can ratify or repudiate any contracts or transactions entered into on behalf of the partnership during their minority. Ratification means accepting and adopting the contracts, while repudiation means rejecting or disclaiming them.