Which statements are true about partnership?
(A) Each partner carrying on the business is the principal as well as the agent for all the other partners.
(B) Valid partnership can be formulated even without a written agreement between the partners.
(C) Interest on partner's loan is to be given @ 12% p.a., if the deed is silent about the rate
(D) The maximum number of partners can be 50.
Choose the correct answer from the options given below:
Answer & explanation
Correct answer: option 1
The correct answer is Option (1) → (A), (B) and (D) only
(A) Each partner carrying on the business is the principal as well as the agent for all the other partners. Correct. This is mutual agency: a partner binds the others by his acts and is bound by theirs.
(B) Valid partnership can be formulated even without a written agreement between the partners. Correct. The agreement may be oral or written; the Act does not require writing.
(C) Interest on partner’s loan is to be given @ 12% p.a., if the deed is silent about the rate Incorrect. In the absence of an agreement, interest on a partner’s loan is allowed at 6% per annum, not 12%.
(D) The maximum number of partners can be 50. Correct. Under Section 464 of the Companies Act 2013 the Central Government has prescribed 50 as the maximum (the Act allows it to go up to 100).
NCERT (2026-27 edition):
NCERT (2026-27 edition): |
