PARTNERSHIP FIRM

COMPANY

AS TO LEGISLATION

Partnership regulated under Partnership Act 1932

Company is regulated under companies Act, 2017.

AS TO LEGAL ENTITY

Partnership has no legal entity.

Company has separate Legal Entity.

AS TO CREATION

Partnership is created by a Simple Agreement.

Formalities required for company incorporation must be observed.

AS TO TRANSFER OF SHARE

The Partner cannot transfer shares without the other Partner's consent.

In Company Shares are easily transferable.

AS OF MEMBERS

In a partnership, a minimum of two partners and a maximum of twenty partners are allowed.

In a company, there must be at least two members, with the maximum based on shares.

AS TO LIABILITY

Partners have unlimited liability in a partnership firm.

The Company's liability is limited to the value of its shares.

AS TO MANAGEMENT

In a partnership, each partner can actively participate in managing the business.

In company Management is carried on by Directors.

AS TO AUDIT

Audit is not compulsory by law under Partnership Firm.

Audit is Compulsory by law under the Company.

DISTRIBUTION OF PROFIT

Profit is distributed among the partners according to the ratio defined in the partnership deed.

Profit is distributed to Directors based on their shareholding in the Company.

AS TO CONTRACT

A Partner cannot make Contract with his Firm.

Shareholder can make an Agreement with the Company.

AS TO OWNERSHIP

In Partnership Property belongs to Partners.

Property belongs to the Company.

AS TO SUCCESSION

In case of share transfer or inheritance, the partnership is seriously affected.

Shares of the Companies can be easily transferred to the heirs of members/shareholders.