February 04 2006
Amnesty scheme, Registrar of Firms
The Government should come out with an amnesty scheme for all defaults in registration of partnership firms with Registrar of Firms.
Why an amnesty?
Under the Indian Partnership Act, 1932 (as is applicable in Maharashtra and consequently in Mumbai) registration of a partnership firm with Registrar of Firms (ROF) is compulsory. There are very drastic effects of non-registration. For example, if a partnership firm is not registered, it cannot file a suit against any one!
Additionally, almost every change in information submitted to the ROF must also be registered. For example, if a new partner is admitted or a partner retires or a partner changes his residence, ROF must be informed within a prescribed time. There are monetary penalties for delay in submitting initial application of registration and also for delay in submitting any other information later on.
There are plenty of firms who have not been able to comply with their obligations. This may be due to ignorance, inability or unwillingness 
of partners.
Who benefits out of this?
Its a win-win situation for both the partners/firms and the government!
Its beneficial to partners/firms because it will help them sort out their registration mess. It will give them an opportunity to save themselves from drastic consequences for small defaults.
Its beneficial to government because it will generate additional revenue as fees! There are people who are not coming forward because of penalty, but they will see this as an opportunity and willingly pay some fees. Additionally, it will also help in updating the records of Registrar of firms. If the records are not proper, they are somewhat useless!
Will the government ever wake up to this need?
Actually, you can sue under the Indian Partnership Act, 1932… but only upto a value of Rs 100 :d
I don’t know when they will update these laws.
Oops.. i meant you can sue as an un-registered firm…. i.e. either a claim or an off-set not exceeding Rs 100
So thats like not being able to sue!
For Rs. 100, now-a-days people don’t even pick a street fight
yeah that’s why I said they need to seriously review stuff… prime example is how Dhariwal got a bail in the guthka case where the gutkha was contaminated.. the bail amount was only Rs. 1000… 1000 rupees might hve been a lot in 1986 when the Consumer Protection Act was enacted, but today it is peanuts.
How to check whether a particular firm is registered or not, if the partners are not willing to provide registration certificate, before any contract.
How we will know the particulars of changes made, if any, without being informed by the existing partners.
If the firm is not registered, in what name the third party can sue – in partners name or in firms name.
What precautions to be taken from legal angle before signing any contract with such firm – i.e. whether it is registered or not, is not clear at the time of contract.
As an outsider, a person need not worry too much about whether the firm is registered or not! If the partners say its registered, you assume it to be registered. You can try to get a written communication for the purpose. But if it is not there, it does not harm you much. If you find later on that its not registered, they can be tried even for fraud and/or misrepresentation.
If you need to sue them, you can sue them in the name of the firm and make all or some of the partners parties to the suit. If it turns out that its not a registered firm, you still can continue the suit against the individual partners and also the firm which can be treated as Association of Persons (AOP).
Non-registration or improper registration is deterimental to partners and the firm not others! Default of partners in registering cannot work against an innocent outsider.
Unlike Registrar of Companies (ROC), the records of Registrar of Firms (ROF) are not open to public. So you cannot particularly have a look at the partnership deeds on records of ROF and cannot find out the particulars of the changes made. However, you can still visit the offices (which in Bandra in Mumbai) and find out the information that you require. Inspection of some of the information is allowed on payment of some fees (I think Rs. 20).
But the changes are of no importance to an outsider simply because the partnership has unlimited liability. If the partnership assets are insufficient to pay the debts, personal assets of partners can be used.
Rules are more stringent and public is given access to some more documents at ROC because a company is a separate entity with a limited liability. If the assets of the comapny are insufficient, you can’t look towards the personal assets of its shareholders. However, people now take personal bonds of directors in some of the cases. Most recent and famous incident that comes to my mind is that of Amitabh Bachchan. He personally paid all the liabilities of AB Corp. because he had signed personal bonds.
ROF offices in Mumbai are located at Bandra (E) near Chetana College. Labour Court is in the same building as ROF.
For certified copy of registration certificate, you will have to go there and apply for it. You may even take inspection on payment of a small fee (I think, Rs. 20). If you don’t know the registration number, they will help you out with their indexes.
Where is ROF office is located in Mumbai.
How to get certified copy of registration of a registered firm.
Dear sir,
Can any one confirm the process and cost , to close a partnership firm , registered in mumbai in year 1996
I want to change to properitorship company
you can speak to me pune, 9822017010
natekar
Cost depends on the assets of the firm. Is there any immovable property in the name of the firm? If yes, how was it bought? Who is taking over it now? What other assets are there? How are they divided? Is it a dissolution by choice or by operation of law?
These are some of the factors that decides the stamp duty on the dissolution deed. It may even need Registration. No one can confirm the cost without knowing the facts and your terms of dissoution. Its pretty subjective.
Dear sir,
I have applied for registration of Partnership Firm on 13/03/06 vide receipt no. 079746 . while submitting the application form, the necessary documents were scrutinized by the concerned clerk . We were called on 27/04/06.When our representative was sent on 03/05/06 , the registration certificate was not ready and we were asked to come next week. On 19/5/06 our representative again visited your office and that time we got information that there was some objection in our documents submitted to you. However, to know what query is , we are asked to visit your office again.
Sir, would you please tell us when we would be able to get correct information, does it solely depends upon the whims of the concerned clerks? Is there no value of the time and energy of the commoners?
I am writing this with optimism that , note of my complaint will be taken by you.
Yours truly,
Dr. Seema Khot, Partner
New Horizons International
Dear Dr. Khot,
I think you have posted your query on the wrong site! This is not the official ROF site, but a blog!
You are advised to take help of a professional legal consultant handling partnership work to solve your matter. There are various “formalities”
that are required to be fulfilled before a registration certificate is issued.
Regards.
Ashish Mehta.
WHETHER THIS NAME IS AVAILABLE
There is no question of availability of name in case of partnership firms. There can be many firms of the same name.
1) kindly let me know the amount of stamp paper that is required to form a partnership deed.
2) in case of minor partners can the guardian be the partner alongwith the minor in both the capacity as guardian as well as partner
thank you
1. Stamp duty depends on the total capital contribution of partners. As on today in Mumbai, minimum is 500, maximum 5,000. For every 50,000 (or part of 50,000) capital contribution, you have to add 500 to stamp duty. So if total capital contribution is Rs. 125,000, stamp duty will be Rs. 1,500.
2. In my humble opinion, you need at least 2 major individuals to form a partnership. Minors can be “admitted to a partnership” for profits. Minor (or anyone on his behalf) does not sign a partnership agreement. No liability can be foisted on him and a minor can only be a partner in profit.
Regards.
Ashish Mehta
what r the requirements for registration of partnership firms? (except partnership deed)
For registration, you will need to file the following (as on January 2007):
1. Covering letter with a Rs. 5 court fees stamp
2. Form A. It must be properly filled and notarised.
3. Blank Stamp Paper of Rs. 20 for an extract.
4. Certified Copy of Partnership Deed.
5. Certified Marathi Translation of the Partnership Deed.
Regards.
Ashish Mehta.
BUT I DIDNT GET FORM A. CAN U HELP ME?
In Mumbai, you can go to a shop called TaxPrint in Fort area for Form A.
Regards.
Ashish Mehta.
Hi Ashish,
Your bolg is really useful for us. Me n my husband are starting a new Co. I have some queries:
1. Covering letter with a Rs. 5 court fees stamp-how do we pay this court fees stamp?
2. Form A. It must be properly filled and notarised.-wht do you mean by notarising?
3. Certified Copy of Partnership Deed & Certified Marathi Translation of the Partnership Deed-Is it compulsory to submit the deeds?
4. Wht is the procedure for registration of proprietorship Co?
Thnx n Rgds,
Ritu
Hi Ritu,
Glad to know you found it useful
Hi Ashish I am impressed you are doing real good job hope you’ll be of help to me too.
1. I want to start a small partnership music firm.I will be byuing and selling and producing records do I need to get soem kind of license to do that if yes do I need to attach with partnership deed or register it if yes where do I do that?
2.I will be selling my product abroad do I need special Export import licene can I obtain that having a firm under partnership deed if yes where can I get and do that?
3.if there any number of yours where I can reach you?
oh yes I forgot to ask….
If I have entered into agreements with singers composers or other companies do I have to attach that with partnership deed (my agreements with them are on 2 individual basis and I want to use those agreement for new firm too) or if I enter later do I have to register those agreements too if yes where do I do that ?
thanks
Hi Nysa!
Here’re answers to your questions.
Hope I have given all answers.
Regards.
Ashish Mehta.
hi ashish,
i wud be forming a partership firm for carring out investement related activities. can u pls tell me the legal formalities for formation of the firm. plus documentation for opening bank account and filing of returns. and other legal formalities if my activities involve brokerage too. thankyou for providing us a platform to ask our querries
Hi Sheetal!
First step is to get into a partnership agreement and apply for PAN in Income Tax with form 49A. You should get your PAN within a month.
Simultaneously, apply for registration in registrar of firms. You don’t need PAN there. I have already specified above about what you need for ROF registration. Also get a rubber-stamp of your firm.
As soon as you get your PAN, apply for a bank account. If the bank is willing, then you may be able to open the bank account even with a copy of PAN application.
With your PAN in hand, you will have to apply for TAN (TDS Account Number) in Form 49B and also Service Tax Registration in form ST1.
You have to file your Income Tax and Fringe Benefit Tax return once in a year, but pay advance tax 3 times in a year. There is no separate registration for FBT. Returns are filed with PAN and along with Income Tax return.
You have to file TDS returns 4 times in a year. Service Tax returns have to be filed twice in a year but service tax has to be paid 4 times in a year.
You can get PDF of all forms on various government websites.
http://incometaxindia.gov.in/allforms.asp
http://www.servicetax.gov.in/st-formmainpg.htm
You can also have a look at my other post
Starting a new venture in India
Regards.
Ashish Mehta.
what is the penalty for delay in registration
ashish,
thanks so much, i was planning to create a partnership, but after reading about the unlimited liability i think a pvt ltd, is the way to go.
great blog by the way.
take care,
mrj
Thanks for the appreciation.
Besides limited liability there is one more advantage of a limited company.
All outsiders perceive you as a bigger entity, whether actually you are bigger or not. Try to take finance for business from a bank as a partnership firm and as a limited company. Financers are more willing to lend to companies than firms or individuals.
Dear Mr. Ashish,
You provide real helpful tips/information through this blog. It has been a great help in understanding the registration process.
Many of the points for registering partnership firm are pretty self-explanatory.
A little more guidance that we need is:
We are M/s. Rai-Dixit Consultancy engaged into Consultancy & Solutions for Feature Film, TV, Media, Add-Agency, Firms. Especially for Artists, Technicians, Producers, Directors & Celebrities. This includes solutions based on Face Reading, Astrology, Numerology, Vaastu, etc. etc.. My Partner Dr. Dixit (Ph. D) is quite well known for his research work in astrology.
We are also providing services for Astrology, Numerology, Vaastu and Spiritual to many leading Mobile service providers all over India (these are the services when you call for Astrology from your cell phone.)
Now we are being invited by state owned (Government) Mobile & Internet service providers. These govt. organizations from various states have asked us to get our organization registered and provide then with our firm registration number that they say is different from partnership reg. no.
Could you please guide us on this matter.
If you are providing services like various registrations – partnership deed, firm reg, PAN, TAN, Service tax & others including regular tax related dealings etc…
Please provide your contact details for the same. Your help will be highly appreciable.
Very best
Vivyek Rai
Hi,
This is very helpful blog. I was looking for some sitations of cases where penalty u/s 69A of Partnership Act is reduced or compounded. In my clients case RoF is having high handed approach and asking to pay hefty penalty for 3 defaults counting the days independently. The firm had suo motto sought for recording of changes. Pls email me at sagar.ca@rediffmail.com
Regards and Best of Luck,
Sagar Phadke.
Ashish,
Is limited liability partnership constitution available in india? what r the advantages & disadvantages?
Hi Karat,
As on today, a limited liability partnership is not available in India. I have been hearing/reading about this since quite some time (about 2 yrs) that it is coming soon. But there have been no concrete progress on that.
Since it is not been implemented, I really have nothing to offer in terms of advantages or disadvantages. From the basic premise, it sounds to be a very interesting concept – something which will strike the right balance between a limited company and a partnership. I hope the draftsmen do some good job. Bad drafting is always followed by plethora of amendments and a lot of time+money wasted in litigation.
Regards.
Ashish.
hi guys,
can you give me the url of the registrar of firms, maharashtra
regards
Here’s a list of all Official Maharashtra Government Websites. Link for RoF is not there. No help from Google as well. So I think RoF doesn’t have a website.
http://www.maharashtra.gov.in/english/webRing/webRingAll.php
Regards.
Ashish.
Dear Ashish,
What is the penalty for delay in registration or non-registration of firm?
Dear Ashish,
can u tell me about the matter to be typed on additional stamp paper to be submitted to the rof
Hi Praneeti,
Which additional stamp paper are you talking about?
actually v had registered the firm in 2005 on a stamp paper of rs 200. now v r solving the objection tht they had sent to us. but now the amount is 500 instead of rs200. so v hav to submit extra stamp paper of 300 to overcome the deficit.
Hi
For deficient stamping, you have two options:
First, get blank stamp papers, type the name of the firm, put firm’s rubber-stamp and put marks on the paper in such a way that they cannot be used again.
If you just take the blank stamp papers to RoF with your rubber stamp, etc. they should do the needful.
Alternatively, you can take your original deed to an agent of government (some branches of banks like ICICI, Bank of India, HDFC Bank, etc.) that has been given authority to “frank” documents. Since the document is already executed, you will have to pay penalty of 2% per month of deficient stamp i.e. Rs. 6 per month extra.
But I would prefer the former option.
Regards.
Ashish.
hi Ashish,
i really appreciate that u answered my question.
But i had asked u the question as to what is to typed because ROF refused to accept the stamp papers just with the rubber stamp of the firm. neway there is something to be typed which i went to the ROF and found out.
neway thanks for ur advice.
Hi Paneeti,
Glad to know your problem is solved.
As far as I know, you have to do two things:
1. Cancelled in such a way that they cannot be reused.
2. Mention the name of the firm for which these papers are used.
Please tell us what needs to be typed on those stamp papers. What do RoF guys require?
Regards.
Ashish.
DEAR Ashish,
this is wat u hav to type on the stamp papers.with the rubber stamp of the firm.
Thanks for the info Praneeti.
Regards.
Ashish.
Dear Sir,
1. I have registered 1 partnership firm for which Certificate have been issued but I have not received extract what I have to do for the same & for a certified copy of the Deed?
2. I want to file Deed for Admissuion of new partner. What are the requirements for the same? Within how many days same have to be filed to the registrar?
3. Should Form A must be notarised by Public Notary or can be attested by a practising Chartered Accountant?
hi ashish,
what is the procedure for inspection of documents?
Hi Praneeti
You have to give an application for inspection and pay Rs. 20. You will find the drafts of all applications near their reception desk in RoF.
Regards.
Ashish.
HI ASHISH,
THANKS FOR THE REPLY.
I WANTED TO KNOW IF THE FORM “E” SUBMITTED DURING DISSOLUTION SHOULD BE NOTARISED OR NOT? PLS REPLY AS SOON AS POSSIBLE
Hi
Yes it needs to be notarised.
Regards.
Ashish.
hi
thnks ashish!!
hi,
may i ask from where did u get this information?
Hi
Practical experience. Does that sound familiar?
Regards.
Ashish.
wat kind of practical exp. u were employed there or u handle this rof stuff
Wow! I feel as if I am being interviewed for a job!
Well, at max I can say that I am a partner in few firms and I am the one responsible in handling these matters for my firms.
hi,
no actually i was jst taking a pre test. before believeing u. dont take me wrong. bt i hav to do the dissolution procedure as soon as possible. therefore i do not hav time to go to the rof and find out. neway you were of great help. i am really sorry again.
thanks
praneeti
Pre-test! So I was right. It was an interview
When I am not sure about something like this, I take a “what if” approach.
If notary is not required and I do it, I lose 30-40 bucks but they can’t reject the document.
If notary is required and I don’t do it, I lose double time + double money.
well i m impressed
actually i hav jst started handling rof related matters. nd visiting the place is like a waste of time for me. so if i get a readymade soln then it saves more than half my energy and time. neway thanks. nice chattin wid u!
Same here. Glad I was able to help
HI,
ASHISH,
I WANTED TO ASK IF I HAV TO SUBMIT OFFICE COPY ALONG WITH ORIGINAL COPY TO THE ROF FOR CANCELLATION OF REGISTRATION .REPLY ASAP.
PRANEETI.
Hi
Office copy / original copy of what?
I think you should always give all relevant papers with a covering letter and get an acknowledgment on your copy (i.e. office copy) of covering letter.
If you have to file 10 papers, you can’t take acknowledgment on each. Covering letter is the way to go.
Regards.
Ashish.
PS: Using all caps in emails / blogs / forums / websites is akin to shouting in real world.
http://en.wikipedia.org/wiki/Netiquette
hi,
ashish
for dissolution procedure. papers that i will be sumitting to the rof for cancellation of registration
- Write a covering letter
- Attach originals to it
- Mention clearly in covering letter that originals are attached
- Get an acknowledgment on covering letter
Regards.
Ashish.
hi,
ashish,
can you tell me the procedure for a fresh registration.
Hi
This is from one of my comments earlier
1. Covering letter with a Rs. 5 court fees stamp
2. Form A. It must be properly filled and notarised.
3. Blank Stamp Paper of Rs. 20 for an extract.
4. Certified Copy of Partnership Deed.
5. Certified Marathi Translation of the Partnership Deed.
CORRECTION:
You need a stamp paper of Rs. 100 and not Rs. 20 now.
You also need to provide a letter of authority to the person doing in on your behalf.
Regards.
Ashish.
Hi Ashish,
Thanx.
Regards,
Praneeti
hi Ashish,
I already hav a stamp paper worth rs 500 on attached to the partnership deed. now do you want to say that i hav to provide an additional stamp paper of rs 100.
Praneeti.
Yes. In addition to the stamp paper on which p’ship deed is made, you have to provide another stamp paper of Rs. 100.
I hope I have clarified properly now.
Regards.
Ashish.
HI ASHISH,
THANX
REGARDS
PRANEETI