Under which condition, dissolution of a Partnership Firm by Court may…

The correct answer is Option (4) → When a partner becomes insane.

On the suit of a partner, the court may order a firm to be dissolved on grounds such as a partner becoming insane, becoming permanently incapable of his duties, misconduct, persistent breach of the agreement, transfer of his whole interest, or the business being carried on only at a loss.

Option (1) When all partners die. — Incorrect. The death of partners ends the firm on the happening of a contingency; no court order is needed.

Option (2) When the business of the firm is less profitable. — Incorrect. A business that is merely less profitable is not a ground; the ground is that it cannot be carried on except at a loss.

Option (3) If tenure of Partnership mentioned in Partnership Deed is extended. — Incorrect. Extending the term keeps the firm going; it is the expiry of the term that may dissolve it.