Renting out property in the name of partnership firm
When a partnership firm rents out a property in the name of the firm to some of the partners and a person who is not a partner in this firm, whether the signature of the partner who is not a partner in the entity to which the premises is rented out is necessary?????
The current problem is covered by the Indian Partnership Act, 1932. One of the relevant provisions under it enunciates upon the property of the firm, including tenancy. Tenancy Right is part of goodwill. The tenancy right will be treated to be a part of the goodwill and belonged to the firm. The same will have to be valued along with the goodwill and taken into account at the final settlement of the accounts. Therefore, the rights and liabilities over the property of the firm for the course of business must be undertaken by the partners of the entity making the signature of the non-partner irrelevant.
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