Can a minor be partner in a firm? If so, discuss his position before attaining majority and after attaining majority.

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

Under the Indian Partnership Act, 1932, a minor (a person below the age of 18 years) cannot be a partner in a firm. Section 30 of the Act explicitly states that a minor cannot become a partner, though they may be admitted to the benefits of partnership with the consent of all the partners. This provision is in place to protect the interests of minors and prevent them from being bound by potentially onerous business obligations.

The Position of a minor in a partnership differs before and after attaining the age of majority:

Position before attaining majority: If a minor is admitted to the benefits of partnership with the consent of all the partners, they are entitled to the share of profits or property agreed upon among the partners. However, a minor is not personally liable for the debts or obligations of the firm.

Position after attaining majority: Upon attaining majority (turning 18 years old), the minor has the option to continue as a partner or discontinue the partnership. They need to give public notice within a reasonable time to discontinue their association with the firm. If the minor does not give such notice and continues to carry on as a partner, they become personally liable for all the obligations of the firm from the date they attain majority.

It's important to note that the minor's position is limited to sharing profits and enjoying the benefits of partnership, but they do not have the authority to actively participate in the management or decision-making of the firm.