Identify a characteristics not applicable in partnership

The correct answer is Option (3) → Social or Religious Purpose

A partnership exists only where persons agree to carry on a business and share its profits. People who join together for a social or religious purpose are not carrying on a business for profit, so they do not form a partnership.

• Option (1) Maximum 50 members — A feature of a partnership. The Central Government has fixed the maximum number of partners in a firm at 50.

• Option (2) Partnership Agreement — A feature of a partnership. Partnership arises from an agreement, oral or written, between the partners.

• Option (3) Social or Religious Purpose — Correct. This is the odd one out: the agreement must be to carry on a business, not a social or religious activity.

• Option (4) Relationship of Principal and Agent — A feature of a partnership. Under mutual agency every partner is a principal for himself and an agent for the other partners.