Which of the following is not a feature of a partnership deed?

Partnership deed can be oral

The correct answer is option 1- Partnership deed can be oral.

Partnership deed can be oral is not a feature of a partnership deed as when agreement is in written form then it is called partnership deed. 

Partnership comes into existence as a result of agreement among the partners. The agreement can be either oral or written. The Partnership Act does not require that the agreement must be in writing. But wherever it is in writing, the document, which contains terms of the agreement is called ‘Partnership Deed’. It generally contains the details about all the aspects affecting the relationship between the partners including the objective of business, contribution of capital by each partner, ratio in which the profits and the losses will be shared by the partners and entitlement of partners to interest on capital, interest on loan, etc. The clauses of partnership deed can be altered with the consent of all the partners. The deed should be properly drafted and prepared as per the provisions of the ‘Stamp Act’ and preferably registered with the Registrar of Firms. The Partnership Deed usually contains the following details:

1. • Names and Addresses of the firm and its main business;
2. • Names and Addresses of all partners;
3. • Amount of capital to be contributed by each partner;
4. • The accounting period of the firm;
5. • The date of commencement of partnership;
6. • Rules regarding operation of Bank Accounts;
7. • Profit and loss sharing ratio;
8. • Rate of interest on capital, loan, drawings, etc;
9. • Mode of auditor’s appointment, if any;
10. • Salaries, commission, etc, if payable to any partner;
11. • The rights, duties and liabilities of each partner;
12. • Treatment of loss arising out of insolvency of one or more partners;
13. • Settlement of accounts on dissolution of the firm;
14. • Method of settlement of disputes among the partners;
15. • Rules to be followed in case of admission, retirement, death of a partner; and
16. • Any other matter relating to the conduct of business. Normally, the partnership deed covers all matters affecting relationship of partners amongst themselves. However, if there is no express agreement on certain matters, the provisions of the Indian Partnership Act, 1932 shall apply.