The Indian Partnership Act, 1932, defines a Partnership as ‘the relation between persons who have agreed to share profits of the business carried on by all or any of them acting for all'.
To constitute partnership firm in India, there are three minimum requirements. They are,
• There must be an agreement entered into orally or in writing by the persons who desire to form a partnership.
• The object of the agreement must be to share the profits of business intended to be carried on by the partnership, and
• The business must be carried on by all the partners or by any of them acting for all of them.
A common method, by which business activities are carried on in India on a small or medium scale, is through the Partnership business. Although Partnership exists as an entity for tax purposes, under the general law a Partnership is not a separate entity distinct from the partners. Partnership firm in India arises from a contract between two or more persons who contribute tangible or intangible assets together with an objective of earning profit that will be shared between them in predefined portions. Therefore, to form and register a Partnership firm in India, there shall be a minimum of 2 partners and a partnership deed. The number of partners should not exceed 10 in case of “banking business” and 20 in case of “other business.”
Steps to Register an Indian Partnership Firm, Bangalore and other states of India:
• Finalise a business name.
• Prepare Partnership deed which will govern the relationship and other aspects of business.
• Register Partnership firm with Registrar of Firms (optional).
• Obtain PAN for the Partnership Firm.
• Obtain various registration and licenses required to run a business.
• Open a Bank account
Documents: Address proof, photographs and ID proof of the Partners are required.
Registration of partnership firm is mentioned under sections 58 and 59 of the Indian Partnership Act, though it is not compulsory. Section 69 of the Indian Partnership Act, 1932 specifies various effects of non- registration and one among it states the fact that a non- registered partnership firm or its partner cannot file a suit against a third party. Every change in the constitution of a partnership is also required to be registered.
For the purpose of income tax benefits, it is necessary to register a partnership firm with the Department under the Income Tax Act, 1961.
PROPRIETORSHIP CONCERN/ PROPRIETORSHIP FIRM
Business Registration is not required in the case of a proprietorship firm. Since there is no process for the application for availability of name or incorporation etc., (as in the case of companies).
You have to open a bank account with a preferred name & style.
For opening bank account and to start the business you may need any of these registrations,
1 Service tax Registration
2 VAT Registration
3 Registration under the Karnataka Shops & Commercial Establishment Act.
4 Professional Tax Registration
5 IEC Registration
We can help you to obtain these registrations in Bangalore. For sole proprietorship, no separate income tax PAN is required. The PAN of the proprietor will be the PAN of the entity and proprietor will have to file income tax return in his personal name. SunShine Corporate Solutions has all the experience needed to help you with VAT registration, Service Tax registration and other registrations in Bangalore for all kinds of business entities.