Are you worried about how to add a new member to your Partnership Business? The first thing you will need is a Valid Partnership Deed for adding or removing members from your Business.

In India, The General Partnership Firms are governed by the Indian Partnership Act, 1932. The entry of a partner leads to a few reconstitutions, i.e., change in the Partnership Agreement.
Thus, it is advisable for the business personnel to be aware of the legal procedure to add a partner in the partnership firm. 

Process of Adding a New Partner

• Adding a partner needs to express consent from all the partners. It follows Section 31 of the Indian Partnership Act. Consent is put in writing by signing an agreement, which is called a Deed of Admission. 
   
• The partners have to all conduct a meeting and receive majority opinions for adding a new partner.

Rights of the New Partner 

A newly admitted partner acquires the following rights in the firm

1. Right to share the assets of the partnership firm
 

 2. Right to share the profits of the partnership firm
 

3. Valuation and adjustment of goodwill
 

4. Revaluation of assets and Reassessment of liabilities
 

5. Distribution of accumulated profits (reserves)
 

6. Adjustment of partners’ capitals.

How can Online Legal India™ help you?
 

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