“Registration of a partnership firm is not compulsory but beneficial.” Do you agree ? Give three reasons in support of your answer.
OR
If registration is optional, why do partnership firms willingly go through this formality and get themselves registered ? State any three reasons.
It is not compulsory for partnership firms to get themselves registered. However, it is beneficial to get themselves registered because an unregistered firm has to suffer the following consequences :
1.A partner of an unregistered firm cannot file a suit against any other partner or the firm for enforcing his legal rights.
2.An unregistered firm cannot file a suit against any third party or partner for enforcing legal rights.
3.Any partner of an unregistered firm cannot claim a set off in a legal proceeding carried on against the firm by a third party for enforcing any legal right.
4.No salary or commission is provided to any of the partners.