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Indian Partnership Act Law 100 MCQ With Free Exam SET:-1
Q11. Section 13(f) of the Indian Partnership Act, 1932 provides for
(A) Indemnity in favour of the partner against the firm
(B) Indemnity in favour of the firm against a partner
(C) Indemnity in favour of the third parties against the firm
(D) All the above
Answer: Indemnity in favour of the partner against the firm
Q12. An agreement to carry on business in partnership in the future creates a partnership
(A) Immediately on the agreement
(B) On the date mentioned in the agreement irrespective of whether the business has commenced or not on that date
(C) Only on the date when the business is actually commenced
(D) Never creates a partnership and any such agreement is void
Answer: Only on the date when the business is actually commenced
Q13. Under section 44 of the Indian Partnership Act, 1932, the court can order dissolution of a firm on the ground of insanity ordinarily where
(A) A dormant partner becomes insane
(B) An active partner becomes insane
(C) Either (A) or (B)
(D) Neither (A) nor (B)
Answer: An active partner becomes insane
Q14. Match List-I with List-II and select the correct answer using the given below:
| List I (Principles of mutual rights and liabilities of partners) | List II (Relevant case-law) |
| a. Remuneration to a partner in absence of an agreement on this matter | 1. Md. Abdul Sattar v. State of Andhra Pradesh |
| b. Fixation of remuneration by agreement in respect of a partner does not alter his status as a partner | 2. Ghisulal v. Ghumbirmal |
| c. Interest on the capital of a partner | 3. Shelat Brothers v. Nanalal Harilal Shelat |
| d. Action against a partner for balance due to another | 4. Bhagchand v. Kaluram @ Moolchand |
(A) a-4, b-2, c-1, d-3
(B) a-3, b-1, c-2, d-4
(C) a-1, b-3, c-4, d-2
(D) a-3, b-1, c-4, d-2
Answer: a-3, b-1, c-4, d-2
Q15. Under section 11 of the Indian Companies Act, 1956 for a non-banking business, the minimum number of partners can be
(A) Ten
(B) Twenty
(C) Twenty-five
(D) Thirty
Answer: Twenty
Q16. Where in a contract between the partners no provision is made for duration of their partnership or for determination of their partnership, the partnership is:
(A) Unlimited partnership
(B) Particular partnership
(C) Implied partnership
(D) Partnership at will
Answer: Partnership at will
Q17. As a general rule, by virtue of section 13 of the Indian Partnership Act, 1932
(A) Partner is not entitled to interest on the capital subscribed by him
(B) Partner is not entitled to interest on the advance made over and above the share of capital
(C) Both (A) and (B)
(D) Neither (A) nor (B)
Answer: Partner is not entitled to interest on the capital subscribed by him
Q18. Acknowledgment of a liability of the firm by a partner amounts to
(A) Compromising a claim
(B) Relinquishment of a claim
(C) Admission of liability in a suit or proceedings against the firm
(D) Neither (A) nor (B) nor (C)
Answer: Neither (A) nor (B) nor (C)
Q19. Read Assertion (A) and Reason (R) and answer using below:
Assertion (A): Salary drawn by a partner from the firm for his services rendered to it has been treated different from his right to get an additional amount in the form of salary as his share of the firm’s profit.
Reason (R): Because R. M. Chidambaram Pillai v. Commissioner of Income Tax case laid down above principle.
(A) Both (A) and (R) are correct and (R) is correct reason for (A)
(B) Both (A) and (R) are wrong
(C) (A) is right, but (R) is wrong
(D) (R) is right, but (A) is wrong
Answer: Both (A) and (R) are wrong
Q20. The relation of partnership according to Section 5 of Indian Partnership Act, 1932 arises from
(A) Status
(B) Contract
(C) Friendship
(D) None of these
Answer: Contract