Partnership deed
This query is : Resolved
Querist : Anonymous
Querist :
Anonymous
(Querist)
28 June 2013
Hello ,
I am Working on a project of our client. They want to start import - export Business. I have following doubts regarding drafting partnership deed.
1) Whether there is any specific partnership deed format in Import export business ?
2) Where can i get specific format of Partnership ?
3) what are the other requirements of act to establish Business entity ?
I am Working on a project of our client. They want to start import - export Business. I have following doubts regarding drafting partnership deed.
1) Whether there is any specific partnership deed format in Import export business ?
2) Where can i get specific format of Partnership ?
3) what are the other requirements of act to establish Business entity ?
28 June 2013
Do visit nearby CA for an advise
Querist : Anonymous
Querist :
Anonymous
(Querist)
28 June 2013
i had made discussion with one CA and their staff give me a list of Partnership deed. Points are as follow.
1) Name of Partners.
2) Address of Business
3) profit and loss Ratio
4) Name of Firm
i had guided that this type of partnership deed is required.
But My question is this , in partnership deed there are more points to be covered like nature of Business , Remuneration of Partners, drawings of Partners , duration of Business , Capital , Interest on capital , bank account , proper books of account , etc.
Please help me whether i have to prepare partners ship deed as normal course of Business or only four points to be covered which was given by staff of CA
I am waiting for your favorable reply.
Thanks
1) Name of Partners.
2) Address of Business
3) profit and loss Ratio
4) Name of Firm
i had guided that this type of partnership deed is required.
But My question is this , in partnership deed there are more points to be covered like nature of Business , Remuneration of Partners, drawings of Partners , duration of Business , Capital , Interest on capital , bank account , proper books of account , etc.
Please help me whether i have to prepare partners ship deed as normal course of Business or only four points to be covered which was given by staff of CA
I am waiting for your favorable reply.
Thanks
09 August 2024
When drafting a partnership deed for an import-export business, it’s essential to ensure that the deed comprehensively covers all necessary aspects to avoid future disputes and ensure smooth operations. While the basic points provided by the CA’s staff are fundamental, a well-drafted partnership deed should address additional details to cater to the specific needs of an import-export business.
### **1. Specific Partnership Deed Format for Import-Export Business**
There isn’t a “one-size-fits-all” format specifically for import-export businesses, but the deed should be tailored to include specific provisions relevant to the nature of the business. Here are some key elements that should be included:
#### **Basic Points to Include:**
1. **Name of Partners:** Full names and addresses of all partners.
2. **Address of Business:** Principal place of business.
3. **Profit and Loss Ratio:** How profits and losses will be shared among the partners.
4. **Name of Firm:** The name under which the business will operate.
#### **Additional Key Points for Import-Export Business:**
1. **Nature of Business:** Clearly specify that the business involves import and export activities, including the types of goods or services involved.
2. **Capital Contribution:** Specify the amount of initial capital contributed by each partner and the process for additional contributions if required.
3. **Remuneration of Partners:** Detail the salary, commission, or other forms of remuneration that partners will receive for their services.
4. **Drawings by Partners:** Rules and limits regarding the amount partners can withdraw from the business.
5. **Interest on Capital:** Specify if and how interest will be paid on the capital contributions.
6. **Duration of the Business:** Duration for which the partnership will be valid or the terms under which it can be renewed or terminated.
7. **Bank Account:** Details of the bank account to be used for the business, including who will be authorized to operate it.
8. **Books of Account:** Responsibility for maintaining proper books of account and the method of accounting.
9. **Decision-Making Process:** Procedures for making major business decisions and handling disputes among partners.
10. **Roles and Responsibilities:** Detailed roles and responsibilities of each partner.
11. **Compliance with Regulations:** Ensure compliance with import-export regulations, including licenses, permits, and documentation.
12. **Dispute Resolution:** Mechanism for resolving disputes among partners, including mediation or arbitration.
13. **Dissolution:** Conditions under which the partnership may be dissolved and the process for winding up the business.
### **2. Where to Get Specific Formats of Partnership Deeds**
- **Legal Templates:** Some legal websites offer templates for partnership deeds. These can be customized according to your specific requirements.
- **Local Legal Professionals:** Consulting with a local lawyer or legal professional who specializes in partnership agreements and import-export business laws can provide a tailored partnership deed format.
- **Business Associations:** Industry associations or chambers of commerce may provide sample formats or guidelines for partnership deeds in specific industries.
### **3. Other Requirements to Establish a Business Entity**
- **Registration:** Depending on the business structure (partnership, LLP, etc.), register the firm with the appropriate authorities.
- **Licenses and Permits:** Obtain necessary licenses and permits for import-export activities. This includes Importer Exporter Code (IEC) from the Director General of Foreign Trade (DGFT), GST registration, and other relevant licenses.
- **Tax Compliance:** Ensure compliance with tax regulations, including registration for GST, TDS, and income tax.
- **Bank Account:** Open a business bank account in the firm’s name.
- **Insurance:** Consider obtaining insurance coverage for business operations, including liability and cargo insurance.
### **Sample Partnership Deed Draft**
Here’s a simplified example of a partnership deed tailored for an import-export business:
**Partnership Deed Draft:**
```
**Partnership Deed**
**This Deed of Partnership** is made on this [Date] day of [Month, Year] between:
1. **[Partner A’s Name]**, residing at [Address], (hereinafter referred to as "Partner A").
2. **[Partner B’s Name]**, residing at [Address], (hereinafter referred to as "Partner B").
**Whereas**:
- The partners wish to form a partnership to carry out import and export business activities.
**Now, Therefore, it is agreed as follows:**
1. **Name of the Firm:**
- The firm shall be known as [Firm’s Name].
2. **Nature of Business:**
- The business shall involve importing and exporting [Specify Goods or Services].
3. **Capital Contribution:**
- Partner A shall contribute [Amount] to the capital of the firm.
- Partner B shall contribute [Amount] to the capital of the firm.
4. **Profit and Loss Sharing Ratio:**
- The profits and losses of the firm shall be shared as follows:
- Partner A: [Percentage]%
- Partner B: [Percentage]%
5. **Remuneration of Partners:**
- Partner A shall receive a monthly remuneration of [Amount].
- Partner B shall receive a monthly remuneration of [Amount].
6. **Drawings by Partners:**
- Each partner may withdraw up to [Amount] per month as drawings.
7. **Interest on Capital:**
- Interest at the rate of [Rate]% per annum shall be paid on the capital contributed by each partner.
8. **Duration:**
- The partnership shall commence from [Commencement Date] and shall continue until terminated as per the terms of this deed.
9. **Bank Account:**
- The firm shall maintain a bank account with [Bank’s Name], and both partners shall be authorized signatories.
10. **Books of Account:**
- Proper books of account shall be maintained and audited annually.
11. **Decision-Making Process:**
- Major business decisions shall be made jointly by the partners.
12. **Compliance:**
- The firm shall comply with all applicable laws and regulations related to import-export activities.
13. **Dispute Resolution:**
- Any disputes arising out of this partnership shall be resolved through mediation or arbitration.
14. **Dissolution:**
- The partnership may be dissolved by mutual consent or as per the provisions of the Indian Partnership Act, 1932.
**In Witness Whereof**, the parties hereto have set their hands and seals to this Deed on the day, month, and year first above written.
**Partner A:**
Signature: __________________________
**Partner B:**
Signature: __________________________
**Witnesses:**
1. **[Witness 1’s Name]**
Signature: __________________________
Address: __________________________
2. **[Witness 2’s Name]**
Signature: __________________________
Address: __________________________
```
### **Conclusion**
A partnership deed for an import-export business should be comprehensive and include all relevant details specific to the nature of the business. While the basic points are crucial, including additional provisions related to capital, roles, compliance, and other operational aspects will help ensure clarity and prevent disputes. Consult with a legal professional to tailor the partnership deed to your client’s specific needs and ensure all legal requirements are met.
### **1. Specific Partnership Deed Format for Import-Export Business**
There isn’t a “one-size-fits-all” format specifically for import-export businesses, but the deed should be tailored to include specific provisions relevant to the nature of the business. Here are some key elements that should be included:
#### **Basic Points to Include:**
1. **Name of Partners:** Full names and addresses of all partners.
2. **Address of Business:** Principal place of business.
3. **Profit and Loss Ratio:** How profits and losses will be shared among the partners.
4. **Name of Firm:** The name under which the business will operate.
#### **Additional Key Points for Import-Export Business:**
1. **Nature of Business:** Clearly specify that the business involves import and export activities, including the types of goods or services involved.
2. **Capital Contribution:** Specify the amount of initial capital contributed by each partner and the process for additional contributions if required.
3. **Remuneration of Partners:** Detail the salary, commission, or other forms of remuneration that partners will receive for their services.
4. **Drawings by Partners:** Rules and limits regarding the amount partners can withdraw from the business.
5. **Interest on Capital:** Specify if and how interest will be paid on the capital contributions.
6. **Duration of the Business:** Duration for which the partnership will be valid or the terms under which it can be renewed or terminated.
7. **Bank Account:** Details of the bank account to be used for the business, including who will be authorized to operate it.
8. **Books of Account:** Responsibility for maintaining proper books of account and the method of accounting.
9. **Decision-Making Process:** Procedures for making major business decisions and handling disputes among partners.
10. **Roles and Responsibilities:** Detailed roles and responsibilities of each partner.
11. **Compliance with Regulations:** Ensure compliance with import-export regulations, including licenses, permits, and documentation.
12. **Dispute Resolution:** Mechanism for resolving disputes among partners, including mediation or arbitration.
13. **Dissolution:** Conditions under which the partnership may be dissolved and the process for winding up the business.
### **2. Where to Get Specific Formats of Partnership Deeds**
- **Legal Templates:** Some legal websites offer templates for partnership deeds. These can be customized according to your specific requirements.
- **Local Legal Professionals:** Consulting with a local lawyer or legal professional who specializes in partnership agreements and import-export business laws can provide a tailored partnership deed format.
- **Business Associations:** Industry associations or chambers of commerce may provide sample formats or guidelines for partnership deeds in specific industries.
### **3. Other Requirements to Establish a Business Entity**
- **Registration:** Depending on the business structure (partnership, LLP, etc.), register the firm with the appropriate authorities.
- **Licenses and Permits:** Obtain necessary licenses and permits for import-export activities. This includes Importer Exporter Code (IEC) from the Director General of Foreign Trade (DGFT), GST registration, and other relevant licenses.
- **Tax Compliance:** Ensure compliance with tax regulations, including registration for GST, TDS, and income tax.
- **Bank Account:** Open a business bank account in the firm’s name.
- **Insurance:** Consider obtaining insurance coverage for business operations, including liability and cargo insurance.
### **Sample Partnership Deed Draft**
Here’s a simplified example of a partnership deed tailored for an import-export business:
**Partnership Deed Draft:**
```
**Partnership Deed**
**This Deed of Partnership** is made on this [Date] day of [Month, Year] between:
1. **[Partner A’s Name]**, residing at [Address], (hereinafter referred to as "Partner A").
2. **[Partner B’s Name]**, residing at [Address], (hereinafter referred to as "Partner B").
**Whereas**:
- The partners wish to form a partnership to carry out import and export business activities.
**Now, Therefore, it is agreed as follows:**
1. **Name of the Firm:**
- The firm shall be known as [Firm’s Name].
2. **Nature of Business:**
- The business shall involve importing and exporting [Specify Goods or Services].
3. **Capital Contribution:**
- Partner A shall contribute [Amount] to the capital of the firm.
- Partner B shall contribute [Amount] to the capital of the firm.
4. **Profit and Loss Sharing Ratio:**
- The profits and losses of the firm shall be shared as follows:
- Partner A: [Percentage]%
- Partner B: [Percentage]%
5. **Remuneration of Partners:**
- Partner A shall receive a monthly remuneration of [Amount].
- Partner B shall receive a monthly remuneration of [Amount].
6. **Drawings by Partners:**
- Each partner may withdraw up to [Amount] per month as drawings.
7. **Interest on Capital:**
- Interest at the rate of [Rate]% per annum shall be paid on the capital contributed by each partner.
8. **Duration:**
- The partnership shall commence from [Commencement Date] and shall continue until terminated as per the terms of this deed.
9. **Bank Account:**
- The firm shall maintain a bank account with [Bank’s Name], and both partners shall be authorized signatories.
10. **Books of Account:**
- Proper books of account shall be maintained and audited annually.
11. **Decision-Making Process:**
- Major business decisions shall be made jointly by the partners.
12. **Compliance:**
- The firm shall comply with all applicable laws and regulations related to import-export activities.
13. **Dispute Resolution:**
- Any disputes arising out of this partnership shall be resolved through mediation or arbitration.
14. **Dissolution:**
- The partnership may be dissolved by mutual consent or as per the provisions of the Indian Partnership Act, 1932.
**In Witness Whereof**, the parties hereto have set their hands and seals to this Deed on the day, month, and year first above written.
**Partner A:**
Signature: __________________________
**Partner B:**
Signature: __________________________
**Witnesses:**
1. **[Witness 1’s Name]**
Signature: __________________________
Address: __________________________
2. **[Witness 2’s Name]**
Signature: __________________________
Address: __________________________
```
### **Conclusion**
A partnership deed for an import-export business should be comprehensive and include all relevant details specific to the nature of the business. While the basic points are crucial, including additional provisions related to capital, roles, compliance, and other operational aspects will help ensure clarity and prevent disputes. Consult with a legal professional to tailor the partnership deed to your client’s specific needs and ensure all legal requirements are met.
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