Tuesday, April 30, 2024
11:06 AM (GMT +5)

Go Back   CSS Forums > CSS Optional subjects > Group VI > Mercantile Law
Partnership Act Duties & rights conflict Partnership Act Duties & rights conflict

Reply Share Thread: Submit Thread to Facebook Facebook     Submit Thread to Twitter Twitter     Submit Thread to Google+ Google+    
 
LinkBack Thread Tools Search this Thread
  #1  
Old Sunday, February 17, 2013
Junior Member
  
Join Date: May 2012
Location: Karachi, Pakistan
Posts: 5
Thanks: 7
Thanked 0 Times in 0 Posts
ahmedali29 is on a distinguished road
Default Partnership Act Duties & rights conflict
While going through rights and duties of partners, I see a conflicts of ideas between section 36 and Section 16b regarding right of partner to run similar business. Please explain if he can or cannot carry on similar business. Please help
Reply With Quote
  #2  
Old Sunday, February 17, 2013
Raz's Avatar
Raz Raz is offline
Senior Member
Qualifier: Awarded to those Members who cleared css written examination - Issue reason: CE 2009 - Roll no. 2638Medal of Appreciation: Awarded to appreciate member's contribution on forum. (Academic and professional achievements do not make you eligible for this medal) - Issue reason: Elite CSP Medal: Members who previously received (CSP Award and Member of the Year Award ) OR (CSP award + Gold Medal + Medal of Appreciation) are eligible for this award. - Issue reason: Member of the Year: Awarded to those community members who have made invaluable contributions to the Community in the particular year - Issue reason: Diligent Service Medal: Awarded upon completion of 5 years of dedicated services and contribution to the community. - Issue reason:
 
Join Date: Sep 2007
Location: In the hearts of friends and heads of foes.
Posts: 1,858
Thanks: 2,166
Thanked 3,870 Times in 1,441 Posts
Raz has a brilliant futureRaz has a brilliant futureRaz has a brilliant futureRaz has a brilliant futureRaz has a brilliant futureRaz has a brilliant futureRaz has a brilliant futureRaz has a brilliant futureRaz has a brilliant futureRaz has a brilliant futureRaz has a brilliant future
Default
Quote:
Originally Posted by ahmedali29 View Post
While going through rights and duties of partners, I see a conflicts of ideas between section 36 and Section 16b regarding right of partner to run similar business. Please explain if he can or cannot carry on similar business. Please help
Section 16
PERSONAL PROFITS EARNED BY PARTNERS.

(b) if a partner carries on any business of the same nature as and competing with that of the firm, he shall account for and pay to the firm all profits made by him in that business.

Section 36:

Section36 RIGHTS OF OUTGOING PARTNER TO CARRY ON COMPETING BUSINESS. (1) An outgoing partner may carry on a business competing with that of the firm and he may advertise such business, but subject, to contract to the contrary, he may not (a) use the firm-name, (b) represent himself as carrying on the business of the firm, or (c) solicit the custom of persons who were dealing with the firm before he ceased to be a partner. (2) AGREEMENT IN RESTRAINT OF TRADE. A partner may make an agreement with his partners that on ceasing to be a partner
he will not carry on any business similar to that of the firm within a specified period or within specified local limits; and, notwithstanding anything contained in section 27 of the Indian Contract Act, 1872, such agreement shall be valid if the restrictions imposed are reasonable.


Difference
Section 16 is for the existing partners who run the partnership business. They are forbidden to carry on any business in individual capacity which is of same nature and competing one to their partnership business. If they carry on such business in individual capacity then profit earned from that business needs to be paid to the partnership.

Whereas: Section 36 is not for existing partners rather it is for the outgoing partners. Outgoing partner/one who leaves the partnership can carry on similar business after ceasing to be the partner of that firm. However; in some circumstance he may not commence any business which he has already agreed with the partners as stated in section 36(2) if the conditions are of specific period, specific locality but that should not be in conflict with section 27 of the Indian Contract Act, 1872.

So existing partner can not carry on similar/competing business but outgoing can.
__________________
"Tumhary nafs ki qeemat Janat hay isy Janat say kam qeemat pey na bechna."
"Jiyo to istarh ky log tum sy milny ko tarsy; maro to istrah k log tumharee mot par royain"
Reply With Quote
The Following 2 Users Say Thank You to Raz For This Useful Post:
ahmedali29 (Sunday, February 17, 2013), Fatima Saleem (Wednesday, January 21, 2015)
Reply

Tags
partnership

« Previous Thread | Next Thread »

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts
BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are On
Pingbacks are On
Refbacks are On

Similar Threads
Thread Thread Starter Forum Replies Last Post
The constitution of the islamic republic of pakistan, 1973[1] IMTIAZ AHMAD KHAN Constitutional Law 0 Thursday, February 14, 2013 05:40 PM
humen rights in islamic perspective eama International Law 0 Friday, July 13, 2012 03:28 PM
Who gave the media the right? afzaliffi Discussion 35 Saturday, March 10, 2012 01:19 AM
2010 Human Rights Report: Pakistan khuhro News & Articles 0 Saturday, April 16, 2011 10:12 PM
Islamic Concept of Govt? Maha Khan Discussion 9 Friday, April 30, 2010 02:25 PM

CSS Forum - Privacy Statement - Terms of Service - Top

CSS Forum on Facebook Follow CSS Forum on Twitter

Disclaimer: All messages made available as part of this discussion group (including any bulletin boards and chat rooms) and any opinions, advice, statements or other information contained in any messages posted or transmitted by any third party are the responsibility of the author of that message and not of CSSForum.com.pk (unless CSSForum.com.pk is specifically identified as the author of the message). The fact that a particular message is posted on or transmitted using this web site does not mean that CSSForum has endorsed that message in any way or verified the accuracy, completeness or usefulness of any message. We encourage visitors to the forum to report any objectionable message in site feedback. This forum is not monitored 24/7.

Sponsors: ArgusVision   vBulletin, Copyright ©2000 - 2024, Jelsoft Enterprises Ltd.