26 July 2017
If in the question it is clearly mentioned that interest on partner capital is not to be provided according to partnership deed then at the time of death of any partner and the payment is not made on time than sec 37 of partnership act apply or not?
26 July 2017
section 37 of Indian Partnership Act, 1932 : Right of outgoing partner in certain cases to share subsequent profits.—Where any member of a firm has died or otherwise ceased to be a partner, and the surviving or continuing partners carry on the business of the firm with the property of the firm without any final settlement of accounts as between them and the outgoing partner or his estate, then, in the absence of a contract to the contrary, the outgoing partner or his estate is entitled at the option of himself or his representatives to such share of the profits made since he ceased to be a partner as may be attributable to the use of his share of the property of the firm or to interest at the rate of six per cent. per annum on the amount of his share in the property of the firm.
Here the point to be noted is although NO interest is payable on partner's caital account....(This is during the period of partnership when the deceased partner was alive......) Section 37 says about the payment of interest at the rate 6%, after he ceases to be a partner i.e. from the date of death of the partner....
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