Q. (a) Define Joint Stock Company?
(b) What is Partnership Deed?
(c) State contents of a Partnership Deed?
Ans. (a) DEFINITION OF JOINT STOCK COMPANY:
A Joint stock company is normally defined as under:
“An Association of many persons who contribute money or money’s worth to common stock and employ it in some trade and business and ‘who share profit or loss arising there from.”
A Joint Stock Company as the name implies, is an association of’ persons who contribute Capital to be used in a business in the understanding that they shall share in the profits and losses in the extent of their shares they have purchased. under Joint Stock Company, persons unite. For some specific business under a Certificate of incorporation which Is granted by the Government through the Registrar of Joint Stock Companies of the Province In which they have their registered Office. A Joint Stock Company is registered as an artificial person which a separate legal entity and its life being perpetual. The death of insolvency of any member of a Joint Stock Company does not effect its life.
Ans. (b) PARTNERSHIP DEED:
Partnership Deed may be concluded either orally or in writing. The law does not impose any restriction n an oral agreement. It is highly desirable on the part the partners that they should enter into an agreement which is called “Deed of Partnership”. it contains the details as to the.
(1) The amount of capital contributed by each partner.
(2) The ratio in which the profits and losses are to he shared.
The persons who form a partnership are individually known as partners and collectively as a firm. In many respects the partners may make the arrangements they like for the management of the firm’s affairs.
(c) the partnership Deed includes all the important use which are as follows:
1) The name of the partners.
2) The name of the firm.
3) The names, qualifications, occupation and addresses of the partners
4) The nature of business.
5) The duration of partnership, if there is any or at “will”.
6) The amount of capital to be provided for and what proportion.
7) Provision for sharing the profit or loss, as the ease may be and the ratio Of share
8) The management of the firm.
9) Drawing of each partner.
10) Rate of interest, if any payable on the capital.
11) Methods of keeping of accounts and audit.
12) The bank, where accounts to be kept.
13) The authority for signing Checque and other important documents.
14) procedure for dissolution and settlement of accounts after dissolution.
15) Arbitration and settlement of disputes.
Provisions contained in the Articles can be altered with the consent of all the partners.