CUET Preparation Today
In which of the following situation compulsory dissolution of partnership can be done? |
On the death of a partner When a partner becomes insane. When business of the firm becomes illegal. When the business of the firm cannot be carried on except at a loss. |
When business of the firm becomes illegal. |
The correct answer is Option (3) → When business of the firm becomes illegal. "Compulsory Dissolution: A firm is dissolved compulsorily in the following cases: (a) when all the partners or all but one partner, become insolvent, rendering them incompetent to sign a contract; (b) when the business of the firm becomes illegal; or (c) when some event has taken place which makes it unlawful for the partners to carry on the business of the firm in partnership, e.g., when a partner who is a citizen of a country becomes an alien enemy because of the declaration of war with his country and India." |
