Partnership Deed Registration Process in India

Partnership Deed Registration Process

To start a business in India, it is necessary to strictly follow legal formalities and properly register the business. Whether it is a sole or a partnership business, registering your business beforehand is essential. A partnership firm is one of the most widely used business formats. In a partnership firm, two or more people unite to operate an enterprise and divide profits and losses. The basis of such a business is a partnership deed. It stipulates each other’s role, responsibility, and liability in a business partnership. Hence, a partnership deed should be registered at the first point. This blog contains details on the partnership deed registration process in India.

What is a Partnership Firm?

A partnership firm is a mutual agreement between two or more individuals to run a business, sharing profits and losses as per agreed terms. This popular form of business is governed by the Indian Partnership Act 1972, which requires the need to draft a partnership deed.

Benefits of Starting a Partnership Firm in India

• Simple to establish
• Meet fewer compliances
• Faster decision-making
• Sharing responsibilities
• Equal or agreed distribution of profits and losses

What is a Partnership Deed?

A partnership deed is a legal document that comprises of terms and conditions between the partners. The document includes important information relating to defined ratios of profits and losses, capital contributions, roles, dispute resolution clauses, and lot more. While starting a partnership firm in India, it is mandatory to legally register the partnership deed.

Important Clauses of the Partnership Deed

• Name of the Firm
• Partner’s Details like
  • Name 
  • Address 
  • contact number 
  • Designation and more
• Nature of Business
• Duration of the Firm
• Place of Business
• Capital Contribution
• Sharing of Profit/Loss
• Salary & Commission payable to each partner
• Partner’s Loan
• Duties and Obligations
• Admission, Death, and Retirement of Partners
• Accounts and Audit details 

3-Step Process of Partnership Deed Registration in India

Step 1: Drafting and Implementing the Partnership Deed

• Prepare the partnership deed on a stamp paper of an appropriate value.
• Include important clauses like the name and address of the firm, business partner details, nature of business, capital contribution, and distribution of profit/loss.
• Once filled, get the partnership deed signed by all business partners in the presence of witnesses.

Step 2: Application for Firm Registration (Form 1)

• Submit Form 1 to the Registrar of Firms of the concerned state along with the prescribed fee.
• The form must include the following

1. Name of the firm
2. Place of business
3. Name and addresses of all partners
4. Date of joining of each partner
5. Duration of the firm

• All partners must sign Form 1.
• The application, along with Form 1, must be submitted physically or by post.

Step 3: Verification and Issuance of Certificate of Registration

• The Registrar verifies the submitted application and documents.
• Once the successful verification is completed, a Certificate of Registration will be officially issued while recognizing the partnership firm.

List of Documents Required for Partnership Deed Registration in India

Basic Documents

• Duly filled Form 1 (Application for Partnership Deed Registration)
• Stamped and notarized partnership deed
• Affidavit certifying the right details mentioned in the deed

Identity and Address Proofs of All Partners

• PAN Card
• Aadhar Card
• Voter ID/ Driving License/ Passport

Proof of Principal Place of Business

• Rent agreement (if rented) or ownership documents
• Utility bill (electricity bill/water/gas) as address proof

Get Started with TaxDunia 

Starting a partnership firm in India requires a simple understanding of and following legal obligations and a registration process. Create a partnership deed covering the details of each partner and register it with the concerned authority in India. Rely on the professional expertise of partnership registration specialists and tax-saving experts to start your business journey with ease. With the right experts, follow the right advice, and move in the right direction to make a steady process and substantial profits.