Types of Partnership -Partnership Firm

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The partnership business can be classified into two categories.

  1. General Partnership
  2. Limited Partnership

 

  1. General Partnership

If the liability of partners is unlimited, it is called general partnership. All the partners both individually and jointly become responsible for the liability of the firm. All the partners involved in a firm are the real owners of the firm and have the rights to take part in the conduct of the firm.

General partnership can be further classified into two categories:

(a) Partnership at Will 

This type of partnership exists until there is mutual understanding and goodwill among the partners. When any partner informs about dissolution and all the other partners agree to it, only then a firm can be dissolved. No duration of partnership is fixed in this type of partnership.

(b) Particular Partnership 

If there is any partnership for any particular objective or for fixed duration, this is called particular partnership. After the fixed objective has been achieved or the stipulated time has expired, particular partnership is dissolved.

types of partnership
types of partnership

 

2 Limited Partnership

The partnership in which the liability of any or some partners is limited to the extent of the capital they have lnvested in a partnership firm is called limited partnership. Such types of partners cannot take part in conducting the firm, but can inspect/look financial record and give iuggestions. Besides the partners bearing unlimited liability, some partners of limited liability .u, t” admitted accordingly as stipulated in the deed of partnership. However, in the limited system of partnership the liability of all the partners of a firm is not limited.

 

 

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