INTRODUCTION
The Indian partnership Act 1932 deals with provisions for partnership. Partnership Deed is made between two or more individuals who agree to carry out any business and share profits and losses. It includes all the term and conditions as well as outlines the purpose of the agreement so that both the parties have a clear understanding of the roles of each other and guarantee a smooth running of the firm.

A partnership deed outlines the rights and obligations of the partners in partnership business and describes the understanding of working of partners which would help in preventing misunderstanding or conflicts in future. A well drafted partnership deed serves as the foundation of successful partnership venture. The individuals who want to carry out partnership must sign a partnership deed which will be duly stamped under the Indian Stamp Act to make it a legal document. The partnership deed protects the parties’ interests if in case there is any disagreement or confusion over any matter. Knowledgentia Consultants has one of the finest team for contract drafting services and drafting partnership deed inclusive of all legal specifics makes the entire activity a value creating process not just for partners involved but even third parties associated with business.

CONTENTS TO BE MENTIONED IN PARTNERSHIP DEED

• Name of the firm
• Name of the partners along with their address
• Nature and place of business
• Capital contribution of each partner and interest in capital
• Profit sharing ratio of partners
• Maintenance of bank accounts
• Amount of salary or commission allowed to partners
• Death of a partner/ Admission and retirement procedure of a partner

IMPORTANCE OF PARTNERSHIP DEED

• It helps in regulating the liabilities, privileges and obligations of all partners of the firm;
• It helps in avoiding any misunderstanding between the partners since the terms and conditions of the partnership are as of now referenced under the deed;
• In a case of dispute emerges between the partners, it must be settled according to the terms and conditions of the partnership deed;
• It makes it clear to the partners how they should split the profit and loss in the firm;
• It makes clarity on the roles and responsibilities to be played by each partner in the firm;
• It also contains salaries paid to the partners to avoid any confusion. Apart from this it is mandatory to notarize the partnership deed along with registration.
• Also it is easy to create with relatively less or no strict statutory compliances are applicable to partnership firm as compared to LLP and companies.
• External Accreditation: Banks, creditors, and other external parties often require a deed of partnership as proof of partnership structure and agreement when dealing with businesses.
• Non-competitive and confidential: To protect the interests of the partnership, partners may agree to non-compete terms and confidentiality obligations.

TYPES OF PARTNERSHIPS
A partnership deed is a composed document in writing where the interested parties engage in business or a venture together.
Although the following kinds of partnership are typically observed in general:

1. GENERAL PARTNERSHIP: This kind of partnership is between two or more people who carry on a business partnership and in this kind of partnership, the members have equal rights and responsibilities and a single individual can bind the whole group in a legally binding manner. In this arrangement, profits are distributed equally and liabilities are managed equally.
2. LIMITED PARTNERSHIP: In this form of partnership, one party has unlimited liability that is entirely liable, while the other is partially liable that is limited liability. Limited liability partners do not have control over day to day tasks and have limited control over business affairs too.
3. . LIMITED LIABILITY PARTNERSHIP (LLP): In this form of partnership every individual from the partnership holds responsibility to the percentage of investment by them. In this type of partnership, the partners are not liable personally to pay the debts of the firm.

ABSENCE OF PARTNERSHIP
If the partners fail to prepare a partnership deed, then also all the partners are accountable to share their profits and losses. Any monetary drawings made from the partnership account by the partners will not be charged with interest.

STEPS FOR FORMING OF PARTNERSHIP

1. SELECT A BUSINESS NAME: It is important to choose a unique business name which complies with any naming guidelines or restrictions
2. DRAFTING AND NOTARIZING THE PARTNERSHIP DEED: Make sure to go to a notary public to notarize the partnership deed. This makes sure all documents submitted are authentic.
3. OBTAIN A PARTNERSHIP PAN: Apply for a PAN from relevant tax authorities for tax purposes.
4. APPLY FOR REGISTRATION FOR PROTECTING THE INTELLECTUAL PROPERTY: Protecting your company name, business model or inventions and works created by the company are extremely important.
5. APPLY FOR OTHER LICENSES AND PERMITS: Depending on your business and location, you may need additional permits or licenses, such as a business license, industry-specific license, or medical license. Be sure to follow all local and national regulations.
6. OPEN A BANK ACCOUNT: Use the registered partnership deed and other necessary documents to open a business bank account in the name of the partnership. This account will be used for business related financial transactions.
7. TAX COMPLIANCE: Apply for all necessary tax identification numbers, such as Goods and Services Tax (GST) or Value Added Tax (VAT) registration, and fulfill your tax obligations according to the laws of your jurisdiction .
8. MAINTAIN RECORDS: Keep accurate records of all financial transactions and documents related to the partnership. This is essential for tax compliance and corporate transparency.
9. COMPLIANCE WITH ONGOING REQUIREMENTS: Stay informed and comply with all applicable tax and regulatory requirements for partnerships in your jurisdiction. This includes filing annual returns, renewing permits, and meeting tax obligations

CONCLUSION
A partnership deed is an essential document that outlines the foundation of a partnership, from financial contributions to decision-making processes. It provides partners with clarity, legal protection, and a solid framework for collaboration. Crafting a comprehensive partnership deed with the help of legal professionals ensures that the partnership’s interests are safeguarded and sets the stage for a successful and harmonious business venture. Knowledgentia Consultants which is the best law firm in India, can help us navigate the way out of all legal complexities in an easy and a smooth manner. We are your one-stop solution for all kinds of legal, compliance and supplemental matters concerning partnerships. In case of any query regarding this matter you may email us at info@knowledgentia.com or visit our website –https://knowledgentia.com/.