Which of the following statement is incorrect?

The correct answer is Option (4) → The method of settlement of dispute among the partner cannot be part of the partnership deed.

The partnership deed records the terms the partners agree on, and the way of settling disputes among them is one of its usual clauses, so the statement that it cannot be part of the deed is the false one.

Option (1) Valid partnership can be formulated even without a written agreement between the partners. — A true statement. The Partnership Act does not require the agreement to be in writing; an oral agreement is valid.

Option (2) Each partner will share profit in same proportion as other in case partnership deed is not there — A true statement. Without a deed, profits and losses are shared equally.

Option (3) Maximum number of partners as prescribed by Central Government can be 50 — A true statement. The Central Government has fixed the maximum at 50.