A partnership is defined in the Partnership Ordinance as follows.

An association of two or more individuals who agree to operate a business together
with a profit motive.
Several specific features of partnerships are given below.
• The minimum number of partners is two and the maximum is twenty.
• There should be an agreement between partners.
• Having a business.
• There should be an agreement between partners on sharing of profits.
• Every partner is treated as an agent and a principal of himself and other parties.
• Several advantages of partnerships are given below
• Easy to start
• Much capital can be collected
• Skills and talents of several partners can be used.
• Liability is borne by many people
Several disadvantages of partisanships are given below
• Unlimited liability
• Conflicts between partners
• No guarantee of continuous existence of concern
If the partnership is conducted with a name other than the owners name, It has to be
registered under the Business Names Ordinance No. 06 of 1918
 The procedure of registering a partnership is similar to the registering of a sole
proprietorship

A written document in which the conditions of the partnership are included is the “Deed
of partnership.”

Section 24 of the Partnership Ordinance of 1890 is applicable when there is no written
agreement.
• Profits and losses should be shared equally and partners have the right to share the
capital equally when winding up a partnership
• The expenses incurred by the partners on behalf of the business should be paid to them
by the business.
• Interest of 5% should be paid to partners for the extra funds provided by them
to the business in addition to their capital.
• No interest on capital will be allowed
• All partner can participate in the management of the business.
• No partner can claim a salary for the service provided to the business.
• Admission of a new partner cannot be implemented without the consent of all the partners
• Decisions relevant to general business problems can be taken with the consent of
the majority of the partners but decisions with regard to changing of the nature of the
business activities should be taken with the consent of all the partners.
• Account Books of the business should be kept in the main office of the partnership
and they can be inspected and copied by all the partners at any time.
Several rights of partners are given below
• Right to participate in business activities
• Right to enjoy profit
• Right to receive interest for the capital
• Right to receive .interest on loans
• Right to inspect the Accounts books
• Duties of the partners are given bellow
• Participate in the business enthusiastically
• Do not to receive profits personally
• Bare the losses
• Do not engage in competitive businesses