Accountancy Part AAccounting for Partnership

The maximum limit for the number of partner is decided by...........

Answer & explanation

Correct answer: option 4

The correct answer is Option (4) → Central Government

A partnership needs at least two partners. The upper limit is not in the Partnership Act or in the deed: under Section 464 of the Companies Act, 2013, the Central Government is empowered to prescribe it (up to 100), and it has fixed the maximum at 50.

NCERT (2026-27 edition):
Nature of Partnership – “… There is however, a limit on their maximum number. By virtue of Section 464 of the Companies Act 2013, the Central Government is empowered to prescribe maximum number of partners in a firm but the number of partners can not be more than 100. The Central government has prescribed the maximum number of partness in a firm to be 50.”