“Registration of a partnership firm is not compulsory but beneficial” Do you agree? Give reasons in support of your answer.
Though the registration of a partnership firm is not compulsory, but its ignorance or non-registration will lead to following consequences
(i) A partner of an unregistered firm cannot file a suit (case) against the firm or other partners.
(ii) The firm cannot file a suit against third parties.
(iii) The firm cannot file a case against the partners.
In view of these consequences, it is advisable to file firm to get itself registered. Registration of partnership firm means the entering of the firm’s name, along with the relevant prescribed particulars, in the register of the firm, kept with the Registrar of the Firms.
This provides a conclusive proof of the existence of the firm in the eyes of the law, which thereby provides it benefits of fair dealings between all the parties involved.