Explain the procedures involved in dissolving a partnership. – NABTEB QUESTION

The procedures involved in dissolving a partnership:

1. Dissolution provided by partnership Act Section 32 of the partnership Act provides for dissolution of partnership as follows:

Subject to whatever terms or agreement between partners in the Articles of partnership, a partnership is dissolved.

i. If entered into for a fixed term, by the expiration of that term.
ii. If entered into a single venture or undertaking by the termination of that venture or understanding.
iii. If entered into for an undefined time, by any partner giving notice to the other or others of his intention to dissolve the partnership.
iv. By the death or bankruptcy of any partner.
v. If the object for which the partnership business is carried on becomes illegal.

2. The court can decree dissolution of partnership on an application by a partner in any of the following cases:

i. When a partner is adjudged a lunatic by inquisition.
ii. When a partner is incapable of performing his part of the partnership contract.
iii. When a partner is guilt of conduct regarded by the court as calculated to
prejudicially affect the carrying on of the business.
iv. When a partner willfully or persistently commits a breach of the partnership agreement.
v. When the partnership business can only be carried on at a loss.
vi. When circumstances have arisen which in the opinion of the court rendered it just and equitable to dissolve the partnership.