How to register a partnership firm in Kerala?
Partnership firm comprises two or more members who decide to carry the business on an agreed condition. Partners only supposed the share the profit and loss of the company. Partnership companies are with high demands in the Indian business Market. The registration of a partnership firm helps to escalate the business without any risk of infringement.
If a Partnership firm is not registered under the Indian Partnership Act 1932, then it cannot claim or sue against violation of acts by the other partner or third party. Proper registration shields the firm with complete advantages with respect to legal rules. It is very easy to set up partnership firm with less compliance of statutory procedures.
Partnership firm registration procedure:
Partnership name choice
The partners have right to choose any names for their firm subject to the following conditions:-
The names should not be same or too identical to the name of another existing firm who falls under similar business vertical that may lead to confusion. The reason is only to save the reputation of the firm. The names are not supposed to cover words like Empress, Crown, Empire and mean sanction, approval of Government without getting the consent of the State Government to use such words.
Creating Partnership deed
Respective right and obligations of the partnership members are documented called the Partnership deed. This deed may be made by written or oral. However, the oral agreements do not possess any tax value purposes so writing an agreement is must legally. The essential elements of a partnership deed are:
- Name and address of the partners and the firm
- Nature of the business
- Business commencing date
- Partnership duration
- Each partner’s Capital contribution
- Mentioning profit sharing ratio among the partners
On the addition to the above requirements, the partners may point out any extra clauses if they wish to include. Some of such additional clauses are:
- Preparing accounts and arranging for audit
- Commissions, Salaries to partners
- Partner’s Loan, Partner’s capital interest
- Designating the partners with powers, obligation, and duties
- Follow-up of certain rules in death, retirement cases
According to the Indian Stamp Act, the partnership deed should be on a stamp paper. Each partner should have a copy of partnership deed. While registering the partnership firm a partnership deed should also be filed with the Registrar of Firms.
How to Register Partnership firm deed in Kerala?
Registering a partnership firm in Kerala is elegant. An application along with fees has to be submitted to the Registrar of Firms of the State in which the firm is located. The following documents shall be forwarded along with the application form.
- Certified Partnership deed true copy
- Dully filled specimen of Affidavit
- Application of Partnership Registration in Form No.1
- Ownership proof of the place of business either rental / lease agreement
All the partners should sign the statement or application. If and only if the registrar is satisfied with the points of the partnership deed, he will record an entry of the statement in a register called the Register of Firms and he will then issue a Certificate of Registration. The partnership firm shall do registration with the Income Tax department and obtain a PAN CARD. The firm is required to open a Current Account in the name of Partnership Firm soon after receiving the PAN card.